Aug 13 Banks are lobbying U.S. policy makers for
a delay of up to seven years from a provision requiring them to
sell investments in private-equity and venture-capital funds,
the Wall Street Journal reported, citing people familiar with
Bank officials, trade groups and lawmakers are quietly
pressing the Federal Reserve for a multiyear delay of the rule
that limits their investments in private-equity and
venture-capital funds, the Journal said. (on.wsj.com/1l12Pi8)
The "Volcker rule," part of the Dodd-Frank law, restricts
banks' ownership stake in hedge funds and private equity funds.
The rule prohibits banks from making speculative bets with
their own money.
A delay of the rule would affect large banks such as Goldman
Sachs Group Inc, JPMorgan Chase & Co and Morgan
Stanley, the Journal said.
The private equity business has become less appealing in
general to banks because of the 2010 Dodd-Frank financial reform
law. The Volcker rule, expected to be implemented in a few
years, prohibits banks from investing in any fund they do not
Since the Volcker Rule was adopted, some banks have already
The Federal Reserve could not be reached for comment outside
of business hours.
JPMorgan on Monday spun off its last remaining private
equity business, One Equity Partners, and sold almost half of
its stake in the portfolio. Morgan Stanley in 2011 spun off most
of its ownership in the $4.5 billion hedge fund FrontPoint
Representatives from Morgan Stanley, JPMorgan and Goldman
Sachs also could not be reached outside of their business hours.
(Reporting by Kanika Sikka in Bangalore; Editing by Lisa