The Impact of the Volcker Rule on Non-U.S. Banks

Last week the Federal Reserve Board and other U.S. financial regulators issued their much-anticipated proposed rule implementing the Volcker Rule’s prohibitions on proprietary trading and sponsorship of or investments in hedge funds and private equity funds. These provisions have been of grave concern to the largest U.S. banks, but it is sometimes overlooked that the Volcker Rule by its terms applies to non-U.S. banks as well. Although the Volcker Rule exempts business by non-U.S. banks that is transacted "solely outside of the United States," the proposed rule takes a surprisingly narrow view of what activities will qualify to be treated as such and thus sweeps in much more non-U.S. activity than had been expected. It would also impose a host of new compliance, recordkeeping and reporting burdens on U.S. and non-U.S. banks alike.

Click here for more on the highlights of the proposal and its impact on the global operations of non-U.S. banks.

For more information about anything covered in this briefing, please contact Robin Maxwell, or your usual Linklaters contact.