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F ederal reserve bank of DALLAS, TEXAS Dallas 75222 Cir cular No. 6 9 -IT2 July 11, 1969 LIST OF OTC MARGIN STOCKS To All Banks, Brokers/Dealers, Nonbank Lenders and Others Concerned in the Eleventh Federal Reserve District: Attached is a copy of the press release of the Board of Governors of the Federal Reserve System concerning the "overthe-counter" stocks that will be subject to margin regulations. A copy of the list was sent to you on July J , 1969, with our Circular No. 6 9 -1 6 7 . Additional copies of the list will be furnished upon request. Yours very truly, P. E. Coldwell President Enclosure (l) This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) k ยง F E D E R A L press R E S E R V E release July 7, 1969 For immediate release The Board of Governors of the Federal Reserve System today published the attached list of about 290 "over-the-counter" stocks that will become subject to its margin regulations beginning at the opening of business tomorrow (July 8). Margin regulations generally limit the amount of credit a person or firm may obtain to buy or carry securities. Stocks on the OTC list will be subject to the same 80 per cent margin requirements as stocks listed on national exchanges. This means a person or firm buying a stock on credit must make a down payment of 80 per cent of the purchase price and can obtain credit for the remaining 20 per cent. The margin requirement to purchase or carry bonds convertible into margin stocks is 60 per cent. In the past, only stocks listed on national exchanges were subject to margin requirements as were bonds convertible into listed stocks. Pursuant to an Act (P.L. 90-437) adopted by Congress last year, the Board amended its margin Regulations G, T and U to include "over-the-counter" stocks that have characteristics similar to stocks registered on national exchanges. Amendments to Regulations G, T and U, including the criteria used to select the OTC margin stocks, were issued by the Board on June 9 with an effective date of July 8. Regulation G applies to credit provided by persons other than banks, brokers or dealers to purchase or carry equ ity securities; Reg u l a t i o n T concerns credit b y b r o k e r s , dealers and memb ers of national securities exchanges for the same purpose; R e g u lat ion U applies to credit b y banks. M a r g i n requirements o n O T C stocks apply only to loans made on J uly 8 and thereafter. Lo ans m ade prior to that d ate are unaffected by the new amendments. Three changes must be m ade in the attached list to bring It up to date: Wadd ell & Reed, Inc., Class A, common (non-voting) has b e e n acquired by another firm and has b e e n deleted from the list; Commonwealth Life Ins. Co. (Ky.) $1.00 par conmon has b e e n changed to Capital Ho lding Co. $1.00 par common; W e s t e r n Pennsylvania N ational Bank, $5.00 par value, comm on capital, has b een changed to WPNB Co rporation $5.00 par common.
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