Issuance of CLOs surged 49% last year to $82 billion, the most since 2007, when $92.8 billion were arranged, according to Royal Bank of Scotland Group Plc.
The American Bankers Association dropped its request for a federal judge to temporarily block Volcker Rule restrictions on collateralized debt obligations backed by trust-preferred securities.
Wall Street banks are trying to prevent the Volcker Rule from forcing them to wind down funds that use borrowed money to bet on the $3.7 trillion municipal-bond market.
JPMorgan Chase & Co., Goldman Sachs Group Inc. and Bank of America Corp. won a delay of Dodd-Frank Act requirements that they wall off some derivatives trades from bank units backed by federal deposit insurance.
Volcker rule opponents are making their case for alternatives to the proprietary trading ban at a U.S. House Financial Services Committee hearing as regulators move closer to completing work on the Dodd-Frank Act measure.
Mid-sized banks that mostly let Wall Street and small firms speak for the industry during the debate over the Dodd-Frank Act have decided it’s time to carve out their own agenda in Washington.
If big U.S. banks are not forced to sever their investment arms from traditional banking, they will return to behavior that led to the 2008 credit crisis, said FDIC's Hoenig.
