Fed Considers ‘Material Changes’ to Volcker Rule: DealBook Briefing
When Senator Brown asked Mr. Mnuchin if he believed the new bill would reduce regulations for foreign banks, he said: “That is correct.” Indeed,
the Treasury, when it set out its aims in a report last year for reducing financial regulations, included relief for foreign banks.
The Fed in 2014 said that foreign banks with less than $50 billion in United States assets (not a global
consolidated measure) would be eligible for less stringent requirements under its foreign banking rule.
If the bill passes, and the Fed gives foreign banks no relief from certain regulations, the foreign banks could argue in a lawsuit
that they are competitively disadvantaged against American banks with assets under $250 billion that did get such relief, some opponents of the bill contend.
Mr. Quarles said the rule was “an example of a complex regulation
that is not working well,” and that the Fed is working on revisions to make the rule less burdensome to firms that do not have large trading desks.