The Long, Long, Long Road To New Rules For Banks | WAMU 88.5 - American University Radio
Filed Under:

The Long, Long, Long Road To New Rules For Banks

Play associated audio

Would that big, bad JPMorgan Chase trade have violated the Volcker Rule?

It's too soon to say, despite the fact that the rule is part of a two-year-old law.

The Volcker Rule bans deposit-taking banks from making speculative bets. But it allows banks to make investments to hedge risks.

Whether the JPMorgan trade counts as a hedge gone horribly wrong (and therefore kosher under Volcker), or as a speculative bet (and therefore prohibited) depends in part on the details of how the rule is written.

And those details have yet to be finalized.

The rule was included in the Dodd-Frank act, the big financial-reform bill that Congress passed in 2010. It was a few pages long in the statute.

The proposed details of how the rule will be implemented run to hundreds of pages. Five different regulatory agencies are collaborating. And the banks are weighing in with their own, extensive comments.

This long, slow implementation isn't unusual at all. It's entirely typical. Dodd-Frank called for hundreds of new rules; only 27 percent of those have been finalized, according to this recent report (PDF).

The details of the Volcker Rule are likely to be finalized later this year. But the regulators recently said banks will have until 2014 to comply fully with the final rule — four years after Dodd-Frank was passed, and six years after the financial crisis.

Copyright 2012 National Public Radio. To see more, visit http://www.npr.org/.

NPR

Nuns On The Ranch Give A Heavenly Twist To Beef

At a Colorado ranch run by Benedictine nuns, prayer and farming go hand in hand. "We have kind of a corner on the market" for grass-fed beef, says one sister. "People just kind of believe in it."
NPR

Nuns On The Ranch Give A Heavenly Twist To Beef

At a Colorado ranch run by Benedictine nuns, prayer and farming go hand in hand. "We have kind of a corner on the market" for grass-fed beef, says one sister. "People just kind of believe in it."
NPR

GOP Sens. Rubio, Paul Square Off Over Cuba Policy Shift

Rubio, appearing on ABC's This Week, lashed out at Paul, who has expressed support for opening trade with the island nation after a decades-long embargo.
NPR

Obama Calls North Korean Hack 'Cybervandalism'

On CNN's State of the Union, the president expanded on earlier remarks he made criticizing a decision by Sony Pictures to pull distribution of The Interview.

Leave a Comment

Help keep the conversation civil. Please refer to our Terms of Use and Code of Conduct before posting your comments.