, Columnist
Volcker Rule Blame Game Begins
Perhaps one of the silver linings to emerge from the Volcker rule's implementation will be that some banks will be forced to finally do some needed cleanup work on their financial statements.
This article is for subscribers only.
It turns out that a good-sized chunk of Zions Bancorp's earnings existed only in its executives' minds. For this nugget of knowledge, we can thank the Volcker rule. Or at least that's what the bank is blaming for its newfound losses.
The Salt Lake City-based lender today said it would record a significant charge to earnings to write down a bunch of collateralized debt obligations that it won't be allowed to hold once the Volcker rule -- designed to prevent banks from gambling with federally insured deposits -- takes effect. The size has yet to be determined. However, if the charge were based on Sept. 30 prices, Zions said it would have been about$387 million. Zions hasn't earned that much in a fiscal year since 2007.