AFP Signs Letter on Corporate Treasury Concerns with Volcker Rule

By Jeanine H. Arnett, Director, Government Relations & Policy, AFP
Published: 2012-02-15

AFP today joined 26 of the nation’s leading companies and organizations in a letter to the Federal Reserve, Federal Deposit Insurance Corporation (FDIC), Securities and Exchange Commission (SEC), Office of the Comptroller of the Currency (OCC), and Commodities and Futures Trading Commission (CFTC), highlighting the possible business consequences of the proposed Volcker Rule.

“The undersigned companies and organizations, representing a diverse range of industries, believe that the Volcker Rule will have far-reaching negative consequences that will impede our ability to raise capital and manage risk,” the letter states. “As such, we urge regulators to refrain from implementing the rule in its current form, hold a roundtable with stakeholders representing different market participants, and re-propose the Volcker Rule to provide additional time to identify unintended consequences and craft policies to avoid them.”

To read the letter in its entirety, click here.

As the global daily resource and advocate for over 16,000 finance and treasury professionals, AFP and its members have fully support the idea of improving the regulations surrounding our nation’s capital markets however. But there are concerns with the possible impact as a result of regulations such as the Volcker Rule. Since the market has yet to feel the full effect of many of the Dodd-Frank regulations, AFP and its members fear that the Volcker Rule could have an adverse impact on liquidity by disrupting day-to-day cash management practices if access to capital was limited or prohibited. Further, it is unclear about which bank services may be eliminated or impacted if financial institutions are forced to adjust their offerings.

"Corporate treasurers rely on the liquidity that banks offer and fundamentally changing the function of the bank could prove problematic and have far-reaching unintended consequences," said Jim Kaitz, president and CEO of AFP.

Here is a selection of the corporates that signed the letter:

Abbott Laboratories
Business Roundtable
Caterpillar Inc
GE
Nissan Motor Acceptance Corporation
Qualcomm Incorporated
The Boeing Company

For more information, contact Brian Kalish at 301.907.2862

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AFP Signs Letter on Corporate Treasury Concerns with Volcker Rule

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