The government’s ‘fact sheet’ on the Volcker rule

The nation’🧜s biggest banks are all Volck’d up now!

Thanks to the implementation yesterday of the so-called Volcker Rule, which bars deposit-taking institutions fro🐼m gambling with their own mone▨y.

The rule, which was blessed by the five major financial regulators — including the Office of the Comptroller of the Currency, the Federal Reserve and the Securities and Exchange Commission — as expected yesterday, was panned by some critics who argue the new legislation may do more harm than good and not ward off an✃other financial crisis.

“If you take away the banks’ ability to trade, it’s not the banks who pay, it’s the American public,” said outspoken bank analyst Richard Bo🅘ve at Rafferty Capital.

“We just passed [imp♚lemented] a banking rule to prevent something that had nothing to do with the financial crisis,” the analyst added.

The measur🐈e is intended to curb bad risk-taking, and bank officials yesterday were poring over the nearly 1,000 pages of text limiting everything from banks’ ability to make markets in certain securities to owning stakes 🍃in hedge funds.

Reviews of the rules were mixed.

Some bank officials described the new rules as fair while others characterized🌸 them as regulators’ meddle꧒some intervention into corners of the markets that didn’t cause the 2008 housing bust that saw Lehman Brothers file for the biggest bank bankruptcy in history.

“I think regulators are targeting something that didn’t create the financial crisis,” noted Sandler O’Neill bank analyst Jeff Harte, He added that rules were less Draconian than some had expeꦑcted.

Some of the new rules will see bank CEOs being forced to attest to their b🐬ank’s compliance with the trading rules.

The rules, which don’t take effect until July 2015, also require firms to justify their hedging strategies and provide hi🌠storical evidence that certain types of trades protect against risky bets.

To be sure, 🦩since 2009, banks have been curbing their trading activity in anticipation of 🦩the tougher rules.

Goldman Sachs, known for𓂃 its market-making prowess, is expected to face the most significant challenges in the face of the new rules.

Meanwhile, investors seemed to shrug off Volcker’s impact෴ on bi🦹g trading firms: JPMorgan Chase was up fractionally at $56.70, Goldman Sachs closed at $169.73, up 1.23 percent, and Morgan Stanley was up about the same, closing yesterday at $30.77.