Fed gives banks two more years to shed CLOs under Volcker

WASHINGTON (Reuters) - The U.S. Federal Reserve will give banks two more years to divest collateralized loan obligations (CLOs) that fall under the Volcker rule, which bans banks from making a range of risky investments.

The Fed said banks will now have until July 21, 2017 to conform their ownership interests in the funds, which pool together risky loans.

(Reporting by Douwe Miedema; Editing by Alden Bentley)