After consulting with member banks and completing its analysis of Volcker Rule changes, ABA yesterday withdrew its lawsuit against the regulatory agencies.
Although ABA noted that changes to the treatment of bank investments in collateralized debt obligations back by trust preferred securities saved “hundreds of millions of dollars in unnecessary write-downs,” the association said that the Volcker Rule still contains several harmful provisions that affect banks’ legitimate business activities.
“We believe the best opportunity to pursue successful resolution of these issues is to constructively engage with the regulators without the chilling impediment of pending litigation, particularly in light of their recent public statements expressing a desire to address the Volcker Rule’s unintended consequences,” said ABA President and CEO Frank Keating.
ABA and two community banks prompted the regulators to revisit the rule with a lawsuit filed in late December. State associations and bankers also engaged members of Congress, who introduced ABA-advocated legislation and strongly urged the agencies to craft a solution.
Read Keating’s statement.