Some rule changes now on go-slow due to U.S. shutdown
WASHINGTON, Jan 17 (Reuters) - The ongoing federal
government shutdown is impeding efforts to advance several rule
changes that aim to make life easier for financial
Here are some projects stuck in regulatory limbo:
"VOLCKER RULE" OVERHAUL
Last year, the two markets regulators and three banking
regulators agreed to review the "Volcker Rule", a post-crisis
rule barring banks from proprietary trading. The public comment
period on simplifying the rule ended on Oct. 17, and the
agencies are currently reviewing that feedback. However,
relevant officials at the Securities and Exchange Commission and
Commodity Futures Trading Commission are furloughed, meaning
interagency work on the rule is stalled.
COMMUNITY BANK RELIEF FROM THE "VOLCKER RULE"
On Dec. 21, the same five regulators jointly proposed a
separate rule that would exempt banks with less than $10 billion
in assets and relatively light trading activity from the Volcker
Rule. This proposal was mandated by legislation Congress passed
in May. The rule must now be opened up to public comments for 30
days, but this cannot happen until it is published in the
Federal Register where the majority of staff are furloughed.
TAILORING BIG BANK RULES
In October, the Federal Reserve proposed a new package to
ease regulation on all but the nation's largest banks,
establishing four tiers of rules for institutions, with larger
firms facing harsher restraints. The proposal implements a
central part of May's bank deregulation law.
The comment period for that proposal expires on Jan. 22, but
the Fed will not be able to finalize that rule until the Federal
Register is fully operational.
On Dec. 19, the Federal Deposit Insurance Corporation (FDIC)
finalized a new rule easing restrictions on deposits placed with
banks by third party brokers. But that change cannot take effect
until it is published in the Federal Register. At the same time,
the FDIC also sought comment on whether it should further update
its brokered deposit rules and related interest rate caps to
better include technological changes. The FDIC gave the public
90 days to comment on potential changes, but that cannot kick
off until it too is published in the Federal Register.
Before the shutdown, the SEC said it was considering
tweaking rules in two high-profile areas: quarterly reporting by
public companies and shareholder voting rights. Both projects
are in early stages, with the SEC soliciting initial feedback.
But with most SEC employees furloughed, the shutdown has put
those projects are now on go-slow.
(Reporting by Pete Schroeder
Editing by Michelle Price and Tomasz Janowski)
© 2019 Thomson Reuters. All rights reserved. Reuters content is the intellectual property of Thomson Reuters or its third party content providers. Any copying, republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters shall not be liable for any errors or delays in content, or for any actions taken in reliance thereon. "Reuters" and the Reuters Logo are trademarks of Thomson Reuters and its affiliated companies.