U.S. Senator Bob Corker, R-Tenn., a member of the Senate Banking Committee, today said the decision to grant a two-year compliance period for banking regulations known as the "Volcker rule" indicates the rule is overly complex and would be problematic for the economy. He was pleased the regulators took a modest step to provide the markets with some clarity for when institutions must comply with the regulations but said true clarity could only come from Congress improving the flawed statute. The Federal Reserve Board announced today that entities covered by the Volcker rule will have until July 21, 2014 to conform to the statute, giving them two-years from the statutory effective date.
"Today's announcement that institutions will have until 2014 to be in full compliance with the Volcker rule demonstrates the regulations as crafted are overly complex and would be problematic for the economy," Corker said. "While I am pleased that the regulators have recognized the need for this modest step, ultimately this flawed rule will need to be fixed by Congress so companies across our country will not have to incur higher costs of doing business, which will ultimately be borne by the consumer."
Corker is a vocal opponent of the Volcker rule's exemption for U.S. Treasurys and mortgage-backed securities, which he has called "hypocritical" and said would put private businesses at a disadvantage in raising capital. Corker wrote a recent op-ed to expose this loophole and offered an amendment to repeal the exemption. He also issued a public comment letter seeking changes to the proposed rule and cosponsored legislation to delay the effective date until 12 months after a final rule has been issued.