{"id":40113,"date":"2014-01-17T07:10:25","date_gmt":"2014-01-17T12:10:25","guid":{"rendered":"http:\/\/www.hedgeco.net\/news\/?p=40113"},"modified":"2014-01-17T07:58:55","modified_gmt":"2014-01-17T12:58:55","slug":"hedge-fund-regulation-banks-get-cdo-exception-to-volcker-rule","status":"publish","type":"post","link":"https:\/\/hedgeco.net\/news\/01\/2014\/hedge-fund-regulation-banks-get-cdo-exception-to-volcker-rule.html","title":{"rendered":"Hedge Fund Regulation: Banks Get CDO Exception To Volcker Rule"},"content":{"rendered":"

\"\"<\/a>New York (HedgeCo.Net) – The SEC and other federal regulars yesterday approved a rule allowing banking entities to hold on to certain\u00a0CDOs.<\/p>\n

Reuters reports that this would be the first “tweak” to the new legislation known as the “Volcker rule,” which\u00a0prohibits banking entities (and their investments in hedge funds) from making risky bets that solely benefit the banks and not the investor.\u00a0The legislation comes into effect April 1, 2014.<\/p>\n

The American Bankers Association filed a lawsuit warning of heavy losses if banks are forced to sell certain complex CDOs, Reuters reports.<\/p>\n

The new legislation allows banks that own certain collateralized debt obligations backed by trust preferred securities (TruPS CDOs) to forgo the investment prohibitions of section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, known as the Volcker rule.<\/p>\n

The\u00a0Volcker Rule\u00a0is a specific section of the\u00a0Dodd\u2013Frank Wall Act\u00a0originally proposed by economist and former Federal Reserve\u00a0Chairman\u00a0Paul Volcker\u00a0to restrict banks from making certain kinds of\u00a0speculative\u00a0investments that do not benefit their customers.<\/p>\n

Volcker argued that such speculative activity played a key role in the\u00a0financial crisis of 2007\u20132010. The rule is often referred to as a ban on\u00a0proprietary trading\u00a0by commercial banks, whereby deposits are used to trade on the bank’s own accounts, although a number of exceptions to this ban were included in the Dodd-Frank law.<\/p>\n

Alex Akesson
\nEditor for\u00a0HedgeCo.net<\/a>
\nalex@hedgeco.net<\/a>
\nHedgeCo.Net<\/a>\u00a0is a premier\u00a0hedge fund database<\/a>\u00a0and community for qualified and accredited investors only. Membership in\u00a0HedgeCo.net<\/a>\u00a0is FREE and EASY. We also offer FREE LISTINGS for\u00a0Hedge Funds<\/a>!<\/p>\n","protected":false},"excerpt":{"rendered":"

New York (HedgeCo.Net) – The SEC and other federal regulars yesterday approved a rule allowing banking entities to hold on to certain\u00a0CDOs. Reuters reports that this would be the first “tweak” to the new legislation known as the “Volcker rule,” […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12,3],"tags":[],"class_list":["post-40113","post","type-post","status-publish","format-standard","hentry","category-hedge-fund-regulation","category-hedgeco-news"],"_links":{"self":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/40113","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=40113"}],"version-history":[{"count":4,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/40113\/revisions"}],"predecessor-version":[{"id":40139,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/40113\/revisions\/40139"}],"wp:attachment":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=40113"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=40113"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=40113"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}