Goldman Sachs Group Inc. said a proposed U.S. ban on banks’ proprietary trading and limits on their investments in private equity and hedge fund may increase financial-system risks the measure was designed to curtail.

“Without substantial revisions, the proposed rule will define permitted market making-related, underwriting and hedging activities so narrowly that it will significantly limit our ability to help our clients -- businesses and investors in the United States and around the world -- raise capital, manage their risks, invest their wealth and generate liquidity from their holdings,” John F.W. Rogers, the firm’s chief of staff, said in a comment letter on proposed Volcker rule restrictions.

The bank filed a separate letter outlining concerns with the 298-page measure’s proposed limits on private equity and hedge fund investments. Goldman Sachs joined its banking rivals, including JPMorgan Chase & Co., Bank of America Corp. and Morgan Stanley, in registering problems with the proposal released in October by U.S. regulators including the Federal Reserve and the Securities and Exchange Commission.

Regulators, who sought input on more than 1,300 questions in their proposal, now have until July 21 to complete and implement the rule.