WASHINGTON, D.C. – Congressman Robert Hurt (R-Virginia) released the following statement following a House Committee on Financial Services hearing entitled, "The Impact of the Volcker Rule on Job Creators, Part I":
"Now that the Volcker Rule is finalized, we are already seeing its detrimental effect on our community banks, not its expressed intended target, and on our capital markets. Smaller and medium-sized firms seeking to grow their businesses will likely face higher costs of capital, ultimately affecting their ability to hire more employees, because of the regulations behind the Volcker Rule and Dodd-Frank. These burdensome regulations are sadly emblematic of Washington's current culture of overregulation of our markets and the American people.
"After expressing concerns about the Volcker Rule's negative impacts on community banks in Virginia's Fifth District, I was pleased to hear that the regulators released an interim final rule addressing these problems. Community banks have expressed that the rule's prohibitions would have a significant impact on their communities and customers prior to the fix.
"I look forward to continuing to work with my colleagues on the Financial Services Committee to bring meaningful reforms to the overregulation by Washington."
· On January 14, 2014, five federal banking agencies approved an interim final rule to allow banks to invest in certain collateralized debt obligations backed primarily by bank-issued trust preferred securities.
· Congressman Hurt cosponsored H.R. 3819, the Fairness for Community Job Creators Act, which states that community banks and other financial institutions holding collateralized debt obligations that were issued prior to December 10, 2013 are predominantly backed by trust preferred securities, are not required to divest these investments under the Volcker Rule released last month.
· The United States is the only country that has adopted anything close to the Volcker Rule, putting America's financial institutions and capital markets at a competitive disadvantage in our global economy.