WASHINGTON (12/22/14)--Federal regulators generally coordinate on Dodd-Frank Act rulemaking efforts involving the Volcker rule and rules related to derivatives regulations, a report from the Government Accountability Office (GAO) has found. Sometimes that cooperation is mandatory, sometimes it's voluntary.
Released Thursday, the report studied how the regulators coordinated on 54 Dodd-Frank rulemakings from July 23, 2013, to July 22 of this year.
The report studied the National Credit Union Administration, Federal Reserve Board of Governors, Federal Deposit Insurance Corp., Office of the Comptroller of the Currency, Consumer Financial Protection Bureau, Commodity Futures Trading Commission and the Securities and Exchange Commission.
According to the GAO, the regulators coordinated on 34 of the 54 reviewed rulemakings.
For the Volcker rule, which prohibits banking entities from trading certain financial instruments using their own funds to profit from short-term price change, "interagency coordination led regulators to adopt a common rule and regulators voluntarily have continued coordination efforts during rule implementation," the report reads.
"For swaps (derivatives) rulemakings, regulators coordinated domestically and internationally," the report reads. "However, such coordination did not always result in harmonized rules, and key differences among some rules have raised compliance and market efficiency concerns among market participants, industry associations and foreign regulators with whom GAO spoke."
The report concludes that, while the full impact of Dodd-Frank cannot be known yet due to rules still awaiting finalization and the lack of time passed since others have gone into effect, some GAO risk characteristics for financial institutions "suggest these companies' leverage generally decreased and their liquidity generally improved since the act's passage."
The report does not contain any recommendations, and according to the GAO, the regulators provided written and technical comments in response, but neither agreed nor disagreed with the findings.