Volcker Rule Update: Amendments To The Covered Funds Provisions

The Federal Reserve Board (the Federal Reserve), the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (collectively, the Agencies) issued a final rule¹ amending the "covered fund" provisions of the Volcker Rule (the Covered Fund Amendments). The Covered Fund Amendments are substantially similar to the changes that were proposed earlier this year² and will be effective on October 1, 2020.

The "covered fund" provisions of the Volcker Rule generally restrict or prohibit a "banking entity" from investing in, or sponsoring or having certain other relationships with, a covered fund. Overall, the Covered Fund Amendments make targeted, not sweeping, modifications to the existing covered fund restrictions by attempting to clarify the treatment of foreign funds; simplify certain compliance requirements, including by limiting the