TOP NEWS

NVCA Cheers Proposal To Let Banks Invest In VC Funds

The National Venture Capital Association (NVCA) said this week a proposed modification to the Volcker Rule would allow commercial banks to once again invest in venture capital funds as limited partners (LPs), which it says would allow more capital to be available for venture firms to invest in startups. According to the NVCA, the current prohibition on financial institution investment into venture capital creates an "unnecessary roadblock for capital formation, particularly in underserved areas where raising capital for venture capital investment tends to be more difficult." It's unclear if the modifications will pass. The NVCA said that--prior to the Volcker Rule--banks were an important source of investment for a number of small and regional venture capital funds.