(January 20 – 15: 45 ET) – The U.S. Federal Reserve Board has approved an interim rule allowing the creation of financial holding companies as contemplated in the U.S. Financial sector Reform legislation, which becomes effective on March 11, 2000.
The Fed will accept comments up to March 27. It will make any necessary changes in the coming months. In the meantime, the Fed says that companies wishing to make use of it can begin applying any time. The rule essentially enshrines cross-ownership between banks, insurers and brokerages, which had been prohibited in the U.S.
Any application filed before February 15 will be considered on the first business day after the rule takes effect, March 13, says the Fed.
As for foreign banks, the Fed says it believes, “The standards and procedures proposed establish a flexible approach that takes account of the statutory requirement for comparability of capital and management standards while assuring that foreign banks operating in the United States are also offered national treatment and equality of competitive opportunity.”
-IE Staff