On August 2, 2017, the Office of the Comptroller of the Currency (“OCC”), which charters national banks, issued a press release and notice seeking comments proposing revisions to the  regulations that implement the so-called “Volcker Rule” in order to “better accomplish the purposes” of the Rule. The Volcker Rule, enacted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), and its regulations, adopted by five financial regulators in December 2013, generally prohibit banking entities and affiliates from engaging in proprietary trading or sponsoring or acquiring ownership interests in certain private equity funds.

In the Notice, the OCC references the recent report issued by the Secretary of the Treasury that the President required in Executive Order 13772 as part of the Trump Administration’s deregulatory initiative. The Secretary of the Treasury was required to report to the President on the extent to which current U.S. financial regulatory requirements promote and support seven “Core Principles” on regulating the U.S. financial system as set forth in the Executive Order, or are inconsistent with them. On June 12, 2017, Treasury Secretary Steven Mnuchin issued his report (the “Treasury Report”).

The Treasury Report makes approximately 100 recommendations that cover a wide regulatory area. It should not be surprising that most of the recommendations revolve around the major changes to the Dodd-Frank Act, including the Volcker Rule. Recommendations regarding the Volcker Rule included exempting smaller banking entities (with $10 billion or less in assets) from the Rule, simplifying definitions of the exemptions to the Rule and improving regulatory coordination in connection with interpretations of the Rule.

Further statutory or regulatory actions are necessary to implement the recommendations set forth in the Treasury Report. The OCC has forged ahead by itself, acknowledging that any revisions to the Volcker Rule must be adopted jointly by the five agencies. The information received could assist the Treasury Department and the five agencies in implementing some of the recommendations in the Treasury Report, or they could be new ideas “consistent with the spirit of the Treasury Report.”

While the Notice welcomes any comments regarding possible revisions to the Volcker Rule, it poses a series of specific questions covering four broad areas:

• The scope of the entities to which the Volcker Rule applies
• The Rule’s restrictions on proprietary trading
• The restrictions on sponsoring or investing in “covered funds” as defined in the Rule
• The Rule’s required compliance program and metrics reporting requirements

Comments are due by September 21, 2017.