Full text of Federal Reserve Bank of New York Circulars : 7701. Proposed Amendment to Regulation H

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FEDERAL RESERVE BANK
OF N E W YORK

r Circular No. 7 7 0 1 1
L September 3, 197S J

PROPOSED AMENDMENT TO REGULATION H
Registration of State Member Banks Acting as Transfer Agents

To All State Member Banks, and Others Concerned,
in the Second Federal Reserve District:

F o llo w in g is th e te x t o f a sta te m e n t issued A u g u s t 28 by the B o a rd o f G o v e rn o rs of the
F e d e ra l R e se rv e S y ste m :

The Board of Governors of the Federal Reserve System today published for comment a proposed regu­
latory amendment to implement provisions of the Securities Acts Amendments of 1975 that provide for
registration of State member banks that act as transfer agents.
Comment will be received by the Board through September 29, 1975. Other bank regulators, and the
Securities and Exchange Commission, are issuing similar regulations for institutions subject to their juris­
diction. Under the new legislation, bank transfer agents are regulated primarily by their designated Federal
bank supervisory agency. In addition, the S E C has general rulemaking and policy oversight responsibilities
for all clearing agencies’transfer agents with the objective of fostering a national system for the prompt and
accurate clearance and settlement of securities transactions.
After December 1, 1975, State member banks may not act as transfer agents unless they are regis­
tered with the Board in compliance with the proposed regulation, as finally adopted.
P r in te d below is th e te x t o f th e proposed am en d m en t. C om m ents th ere o n should be su b ­
m itte d by S e p tem b e r 29, 1975, a n d m ay be sen t to o u r B a n k R e g u la tio n s D e p a rtm e n t.
In a d d itio n , a copy o f th e proposed re g is tra tio n sta te m e n t, to g e th e r w ith related in stru c tio n s,
is enclosed f o r S ta te m em ber banks. A d d itio n a l copies will be fu rn is h e d upon request.

Paul A. Volcker,

President.
[Reg. H]
[12 C F R 208]
M E M B E R S H I P O F S T A T E B A N K I N G INSTITUTIONS IN T H E F E D E R A L R E S E R V E S Y S T E M
Notice of Proposed Rulemaking
Pursuant to authority of sections 17, 17A and 23(a)
of the Securities Exchange Act of 1934 (15 U.S.C. 78q,
q-1 and w) (“
Act”), the Board of Governors proposes
to amend its Regulation H, “Membership of State Bank­
ing Institutions in the Federal Reserve System,” (12
C F R 208) to require that, on or after December 1,
1975,1 no State member bank or any of its subsidiaries
shall*act as a transfer agent, as defined in section 3(a)
1 See §31 (a ) of Pub. L. 94-29 (June 4, 1975).




(25) of the Act, with respect to any security registered
under section 12 of the Act or which would be required
to be registered except for the exemption from registra­
tion provided by subsection (g)(2)(B) or (g)(2)(G)
of that section, unless it has registered with the Board
in conformity with the requirements of Form TA-1.2
2 A copy of Form TA-1 is filed as part of the original docu­
ment. Copies are available on request to the Board of Governors
of the Federal Reserve System, Washington, D.C. 20551, or to
any Federal Reserve Bank.
( over)

This amendment relating to State member banks is
proposed to assist in the development of a modern na­
tionwide system for the safe and efficient handling of
securities transactions in a manner which best serves
the financial community and the investing public. Con­
gress has directed the Board to regulate certain transfer
agent activities to facilitate this purpose. Form TA-1 is
designed to provide basic information related to transfer
agents required to register with the Board in order to
aid in the development of appropriate regulatory stan­
dards.
Pursuant to the amendment, a new paragraph (f)
would be added to §208.8, as set forth below:
S E C T I O N 208.8—B A N K I N G P R A C T I C E S
*

*

*

(f) State member banks as transfer agents.
(1)
O n or after December 1, 1975, no State member
bank or any of its subsidiaries shall act as a transfer
agent, as defined in section 3(a) (25) of the Securities
Exchange Act of 1934 (“
Act”), with respect to any
security registered under section 12 of the Act or which
would be required to be registered except for the ex­
emption from registration provided by subsection
(g)(2)(B) or (g)(2)(G) of that section, unless it
shall have filed a registration statement with the Board
in conformity with the requirements of Form TA-1,
which registration statement shall have become effective
as hereinafter provided. Any registration statement filed
by a State member bank or its subsidiary shall become
effective on the thirtieth day after filing with the Board
unless the Board takes affirmative action to accelerate,




deny or postpone such registration in accordance with
the provision of l7A(c) of the Act. Such filings with the
Board will constitute filings with the Securities and E x ­
change Commission for purposes of section 17(c)(1)
of the Act.
(2)
If the information contained in Items 1 - 5 of
Form TA-1 becomes inaccurate, misleading or incom­
plete for any reason, the bank or its subsidiary shall,
within ten calendar days thereafter file an amendment
to Form TA-1 correcting the inaccurate, misleading or
incomplete information. Within thirty calendar days
following the close of any calendar year quarter (be­
ginning with the calendar year quarter ending March
31, 1976), during which the information reported at
Items 6-7 of Form TA-1 becomes inaccurate, mis­
leading or incomplete the bank or its subsidiary shall
file an amendment to Form TA-1 correcting the inac­
curate, misleading or incomplete information. Each
registration statement on Form TA-1 or amendment
thereto shall constitute a “
report” or “
application”
within the meaning of sections 17, 17A(c) and 32(a)
of the Act.
To aid in consideration of this matter by the Board,
interested persons are invited to submit relevant data,
views, or arguments concerning the proposed amend­
ment and registration statement. Any such material
should be submitted in writing to the Secretary, Board
of Governors of the Federal Reserve System, Wash­
ington, D. C. 20551, to be received not later than Sep­
tember 29, 1975. Such material will be made available
for inspection and copying upon request, except as pro­
vided in section 261.6(a) of the Board’
s Rules Re­
garding Availability of Information (12 C F R 261.6(a)).