Fed Adopts Final Rule For Conformity With The Volcker Rule

On Wednesday, February 9, 2011, the Board of Governors of the Federal Reserve System (the "Board") announced its adoption of a final rule concerning the period of time that banking entities and nonbank financial companies supervised by the Board have to comply with the new section 13 (the "Volcker Rule") of the Bank Holding Company Act of 1956 (the "BHC"), as added by Section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"). As enacted on July 21, 2010, the Volcker Rule generally prohibits banking entities – broadly defined to include banks, parents of banks and subsidiaries and affiliates of either of them – from engaging in proprietary trading in securities, derivatives, or certain other financial instruments, and from investing in, sponsoring, or having certain relationships with a hedge fund or private equity fund. The Volcker Rule further permits the Board or other agencies to impose restrictions, such as capital charges