Final Volcker Rule Is Less Restrictive Than Was Feared

The final draft of the Volcker Rule released by the five regulatory agencies is not as bad as feared earlier, believes Citi. Keith Horowitz and Christopher Larmoyeux of Citi point out the initial read of the Volcker rule is not going to limit proprietary trading in U.S. government, agency, state and municipal obligations. Further foreign government debt would also be excluded from the Volcker rule. Earlier it was feared a new version of the Volcker rule may force U.S. banks to cede their capital market share in credit, sovereign and emerging market sectors to European capital market banks. It was…