Volcker rule revisions may complicate compliance, experts warn

US regulators’ efforts to simplify key test of trading intent could ramp up data demands

Complex idea: banks would have to notify regulators ‘promptly’ if these limits are increased or breached

A hotly anticipated proposal to revise the Volcker rule – released by US regulators on May 30 – could make it more complicated for banks to comply with the prohibition on proprietary trading, experts warn.

“Now what the regulators are saying is that any time you breach, you have to promptly notify the regulators,” says Michael Bailey, a principal in the risk and financial advisory practice at Deloitte. “The question is: what does ‘promptly’ mean? Is that end of the week, immediately, intraday?