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Enhanced Automation is Key for Banks Under the Final Volcker Rule
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anon6764214480
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anon6764214480,
User Rank: Apprentice
2/12/2015 | 11:58:56 AM
Re: Volcker Rule
The burdens that Congress put on regulators through Dodd-Frank are incredibly complex. It's really the largest change to the financial sector's regulation since the Great Depression. So it's going to take a long time," said Gabriel Rosenberg
IvySchmerken
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IvySchmerken,
User Rank: Author
7/21/2014 | 1:42:25 PM
Re: Volcker Rule
One reason for delay is all the complexity added to the regulation. When the Volcker Rule was crafted by namesake Paul Volcker it was simply stated as a ban on proprietary trading by banks. But a lot has been added on. As you can see from Daniel's article, although market making is exempt, brokers that conduct agency trading on behalf of institutional clients, and end up with a "residual position" need to prove this is not a proprietary position or a hedge. So brokers need automated monitoring solutions and analytics that track their residual positions to ensure they are not mistaken for proprietary trades.
Greg MacSweeney
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Greg MacSweeney,
User Rank: Author
7/21/2014 | 6:51:21 AM
Re: Volcker Rule
Agreed. It is taking far too long to get all of Dodd Frank implemented. After 4 years, only about half of the rules are in place:

Wall Street reform law only half done
celinaB
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celinaB,
User Rank: Apprentice
7/21/2014 | 5:02:37 AM
Volcker Rule
The Volcker Rule included in the Dodd-Frank Act prohibits banks from proprietary trading and restricts investment in hedge funds and private equity by commercial banks and their affiliates. The Rule also capped bank ownership in hedge funds and private equity funds at three percent. Institutions were given a seven year timeframe to become compliant with the final regulations. As a provision of 2010's Dodd-Frank Act, the Volcker Rule divides retail banking and investment banking into separate companies. Many experts believe this is important to Wall Street reform, but Congress has dragged its feet, saying that enacting Volcker will damage liquidity and thus increase transaction costs for consumers.


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