Over the past four years, the agencies responsible for implementing the Volcker rule have broadly simplified the rule’s compliance requirements. We have adhered to the intent of the rule while providing greater clarity and certainty for permissible activities.
The rapid expansion in lending to firms is ascribable to the growth in demand, sustained by the need to finance inventories and working capital. The deterioration in credit quality was much less serious than during the recession of the early 1990s, which was not as deep.