Three federal financial institution regulatory agencies including the Board of Governors of the Federal Reserve System ("FRB"), the Office of the Comptroller of the Currency ("OCC"), and the Federal Deposit Insurance Company ("FDIC") provided clarification and guidance to banking entities regarding investments in "Covered Funds" (as defined in the Volcker Rule), and how collateralized debt obligations backed by trust preferred securities ("TruPS CDOs") should be treated under the Volcker Rule. The FAQ addresses the following principal questions: (i) whether a TruPS CDO is a Covered Fund, (ii)

The CFTC granted a limited-purpose swap dealer ("SD") designation to State Street Bank and Trust Company ("SSBT") with respect to its activities in foreign exchange products that are swaps ("FX Products"). The CFTC explained that "limited-purpose designations" designates a person as an SD for one type, class, or category of swap or activities without the person being considered an SD for other types, classes, categories or activities. In the present case, SSBT is given relief with respect to its activities in interest rate swaps. This is the second time the CFTC granted this designation (see

The Office of the Comptroller of the Currency ("OCC") has issued a report titled Semiannual Risk Perspective, Fall 2013, which provides an overview of various risks facing the banking industry. The report focused on issues that pose threats to the "safety and soundness" of those financial institutions which are regulated by the OCC, and is intended as a resource for the industry, examiners and the public. The first ten pages provides a useful summary of the report. Lofchie Comment : One point of interest is that larger banks perform materially better than small ones (page 18), not so

Mercatus Scholar and Associate Professor of Business and Economics at the University of Alaska Anchorage, Holly Bell, published an article discussing the recent efforts by the CFTC to control automated, high-frequency trading. According to Professor Bell, there are significant issues with the CFTC's proposed Concept Release on Risk Controls and System Safeguards for Automated Trading Environments. Professor Bell discussed the negative market effects that could result from the CFTC's attempt to impose a one-size-fits-all regulatory structure on high-speed trading technology, which she states

The CFTC Division of Clearing and Risk ("DCR") issued time-limited no-action relief to the Singapore Exchange Derivatives Clearing Limited ("SGX-DC"), stating that it will not recommend enforcement action against SGX-DC's clearing members for failing to comply with CEA Section 4d(f)(1) ("Dealing by Unregistered Futures Commission Merchants or Introducing Brokers Prohibited; Duties in Handling Customer Receipts; Rules to Avoid Duplicative Regulations") in light of the fact that no CFTC-registered FCMs are members of the relevant clearing corporations. The relief is subject to specified