Financial Choice Act will be presented ‘within weeks’

The Volcker Rule and other aspects of the Dodd-Frank Act will be scrapped if the bill is passed.

A legislative proposal that would eliminate the Volcker Rule will be presented to the House “within weeks,” its author Jeb Hensarling said on Wednesday.

Speaking at the US Hispanic Chamber of Commerce’s legislative summit, the head of the House Financial Services Committee said the Financial Choice Act will achieve the goal of taking “Dodd-Frank and throwing it on the ash heap of history.”

The Volcker Rule states banks may only hold 3 percent of their tier 1 capital in private investments. It has resulted in a mass sell-off of private equity assets by banks, including private markets fund sales, since entering into force.

The bill will also require that every regulation passes a rigorous cost-benefit analysis and oblige regulators to ensure what they are doing helps the economy.

The act, which was approved by the House Financial Services Committee last year and which was due to be introduced in mid-February, was pushed back for “modest changes.”

It is one of two pieces of legislation passing through the US legal system that would unwind aspects of the Dodd-Frank Act. The other, which was given House approval in December, will reduce federal oversight of some mid-sized regional banks by judging their systemic importance based on a range of criteria instead of just asset size.