Five financial regulatory agencies approved the Volcker rule Tuesday, The Wall Street Journal reports. The rule could "lop as much as $10 billion total in yearly pretax profit from the eight largest U.S. banks through lower revenue and higher compliance costs, according to estimates from Standard & Poor's," The Journal further reports. On the other hand, the rule aims to prevent another financial crisis by curbing proprietary trading through curbing "banks' ability to bet with their own capital" and forcing "them to draw bright lines separating trades for clients from trades to limit their risks and so-called proprietary bets," The Journal also reports.
"Proprietary trading helped fuel the financial-services industry's climb to dizzying heights in the years leading up to the financial crisis—and created millionaires within the biggest banks," The Journal further reports.
The rule goes into effect April 1.
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