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E-MailThe following post comes to us from Margaret E. Tahyar and Gabriel D. Rosenberg of the Financial Institutions Group at Davis Polk & Wardwell LLP. This post discusses a Davis Polk report, which is available here. A post about the previous progress report is available here. Another memorandum from Morrison Foerster LLP about the two-year anniversary of the Dodd-Frank Act is available here. Other posts about the Dodd-Frank Act are available here.
This posting, the Davis Polk Two-Year Anniversary Dodd-Frank Progress Report, is one in a series of Davis Polk presentations that graphically track the rulemaking required by the Dodd-Frank Act. The Progress Reports are prepared using data from the Davis Polk Regulatory Tracker™, an online subscription service offered by Davis Polk to help market participants understand the Dodd-Frank Act and follow regulatory developments on a real-time basis.
The special Progress Report marks the two-year anniversary of Dodd-Frank. The state-of-play at the end of this second year of regulatory implementation can be described as follows:
- As of July 18, 2012, a total of 221 Dodd-Frank rulemaking requirement deadlines have passed. This is 55.5% of the 398 total rulemaking requirements, and 78.9% of the 280 rulemaking requirements with specified deadlines.
- Of these 221 passed deadlines, 136 (61.5%) have been missed and 85 (38.5%) have been met with finalized rules. Regulators have not yet released proposals for 19 of the 136 missed rules.
- Of the 398 total rulemaking requirements, 123 (30.9%) have been met with finalized rules and rules have been proposed that would meet 134 (33.7%) more. Rules have not yet been proposed to meet 141 (35.4%) rulemaking requirements.
To highlight the occasion, we have developed several additional features that visually describe aspects of Dodd-Frank in new ways:
- An infographic provides a stats-driven look at the past two years of Dodd-Frank. Since passage two years ago, the initial 848 pages of Dodd-Frank legislative text have generated 8,843 pages of Federal Register rulemaking text as of July 1, 2012. The almost 9,000 pages represent only 30 percent of anticipated Dodd-Frank rulemakings, and imply a 1:10 ratio of legislative to regulatory pages — a ratio that is sure to get smaller as rulemaking continues. The infographic also provides page counts for regulations created so far by 10 of the primary agencies. The most pages of Dodd-Frank rules have been produced by the Securities and Exchange Commission, with 3,200 pages; the Commodity Futures Trading Commission is close behind with 3,187 pages. Other particularly active agencies have been the Federal Reserve (1,439 pages) and the Consumer Financial Protection Bureau (1,013 pages). These page counts were also analyzed across subject matter categories. As those who have been following rulemaking closely may have surmised, derivatives-related rulemaking has generated the most pages of regulation: over 3,363 thus far, and with only 52% of rules finalized. The next most active areas have been consumer protection (1,561 pages), private funds (820), systemic risk (379), and the Volcker Rule (268). Within the derivatives area, market participants are already actively implementing the new regulatory regime. The infographic examines how five individual business divisions at swap dealers and major swap participants are impacted by the over 3,700 tasks called for by the regulations. Operations departments are the most impacted division, with 1,124 tasks to complete, while Legal (909 tasks), Technology (712), Trading (597) and Records (402) divisions are also significantly engaged in implementation.
- On page 5 of the Progress Report, a word map provides an analysis of the most common phrases in Volcker Rule comment letters. Among the most frequently used terms were: covered fund, market making, capital, and liquidity, indications of the primary topics discussed in these letters. To create the word map, we compiled over 280 of the most detailed comment letters that were submitted in response to the comment period for the joint regulator Volcker Rule proposal, which closed on February 13, 2012. We used software to analyze the frequency of words and phrases across these over 4,000 pages of comment.
A JavaScript-enabled interactive Title VII complexity graph, which depicts the interconnections between Title VII rulemakings applicable to swap dealers and major swap participants. As you scroll over a particular rule, green lines appear to show rules that are referenced by the highlighted rule, and red lines show rules that reference the highlighted rule.
