A House-Senate conference committee approved proposals to restrict trading by banks for their own benefit and requiring banks and their parent companies to segregate much of their derivatives activities into a separately capitalized subsidiary.
Negotiations in the US Congress on the agreement to reconcile competing versions on the overhaul of the US financial regulations were ended on Friday.
A House-Senate conference committee approved proposals to restrict trading by banks for their own benefit and requiring banks and their parent companies to segregate much of their derivatives activities into a separately capitalized subsidiary.
The conference committee approved a final revision of the Volcker Rule which restricts the ability of banks whose deposits are federally insured from trading for their own benefit. The agreement limits banks’ investments in hedge funds or private equity funds to no more than 3 percent of a fund’s capital. Those investments could also total no more than 3 percent of a bank’s tangible equity.
The approvals cleared the way for both houses of Congress to vote on the full financial regulatory bill next week.
House overview document
© US House Financial Services Committee
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