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Federal R eserve Bank
OF DALLAS
DALLAS. TEXAS 75222

May 16, 1985
Circular 85-64

TO:

The Chief Executive Officer of all
member banks, bank holding companies
and others concerned in the
Eleventh Federal Reserve District
SUBJECT

Proposal to deal in foreign currency options traded on a stock
exchange through a jo in t venture
DETAILS

The Board of Governors of the Federal Reserve System has requested
comment, by May 28, 1985, on an application by Compagnie Financiere de Suez
and Banque Indosuex, both of Paris, France, to engage in the activity of
dealing in foreign currency options traded on the Philadelphia Stock Exchange
through a joint venture with Drexel Burnham Lambert Group Inc., New York, New
York.
Interested parties are invited to submit their views on the
application to Mr. William W. Wiles, Secretary, Board of Governors of the
Federal Reserve System, Washington, D. C. 20551.
ATTACHMENTS

The Board's press release and the material as submitted for
publication in the Federal Register are attached.
M RE INFORMATION
O

For further information, please contact this Bank's Legal Department
at (214) 651-6228.
Sincerely yours,

For additional copies of any circular please contact the Public Affairs Department at (214) 651-6289. Banks and others are
encouraged to use the following incoming WATS numbers in contacting this Bank (800) 442-7140 (intrastate) and (800)
527-9200 (interstate).

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

FEDERAL RESERVE press release

April 25, 1985

For immediate release

The Federal Reserve Board today requested comment on an application
by Compagnie Financiere de Suez and it s subsidiary, Banque Indosuez, both of
Paris, France, to deal in foreign currency options traded on a stock exchange
through a jo in t venture.
The Board requested comment by May 28, 1985.
This is an a c tiv ity the Board has not previously found to be permissible
fo r bank holding companies.

I t would be performed under a jo in t venture with

Drexel Burnham Lambert Group In c ., New York, through the company's offices in
Philadelphia as well as on the Philadelphia Stock Exchange.
The Board's notice is attached.
-0 -

Attachment

FEDERAL RESERVE SYSTEM

COMPAGNIE FINANCIERE DE SUEZ AND BANQUE INDOSUEZ
Proposal to Deal in Foreign Currency Options Traded on a
Stock Exchange Through a Joint Venture

Compagnie
Banque indosuez,

and

Regulation Y
engage

de

both of Paris,

to section 4(c)(8)
§ 1843(c)(8))

Financiere

of

the Bank

Suez

France,
Holding

(12 C.F.R.

through

Lambert Group Inc.,
banking

firm.

a

New York,

Banque

percent of the shares of
("Company"),
Options

Inc.,

vehicle

for

the

proposed
through

conducting

Company's

Philadelphia

Stock

States and abroad.

venture

and

to Drexel

proposed

The

offices
Exchange,

permission

DBL

would

to
in

traded

investment

each

own

Burnham Lambert
formed

to

serve

activity
would

50

and

customers

in

inc.

(French)
as

through
be

in

Burnham

Burnham Lambert,

Philadelphia

serving

Drexel

("DBL"), an

activity

in

Board's

franc options

with

New York

previously

venture.

for

(12 U.S.C.

Applicants would engage

Indosuez-Drexel

the

the

pursuant

foreign currency options

Indosuez

successor

a company

joint

joint

applied,

of

in French

on the Philadelphia Stock Exchange.
activity

subsidiary,

Company Act

§ 225.23(a)(3)),

in the activity of dealing

its

have

section 225.23(a)(3)

the role of specialist in such

the

and

the
the

performed
on
the

the
united

-2 -

Section 4(c)(8)
provides
engage

of

the

Bank

Holding

that a bank holding company may,

in any activity

“which

the Board

opportunity for hearing has determined

Company

Act

with Board approval,
after

due

notice

and

(by order or regulation)

to be so closely related to banking or managing or controlling
banks as to be a proper
previously

that the activity
or
the

The Board has not
Applicants believe

is so closely related

controlling banks
Applicants'

equivalent
and

thereto."

the proposed activity.

approved

Applicants
engage

as

to be a proper

opinion,

to other

historically

incident

currency

aspects

dealt

of

to banking or managing
incident

options

foreign

in the proposed

In

functionally

exchange

in by commercial

state that at least one bank

are

thereto.

traditionally

banks.

In

addition,

has been permitted

activity of acting

as

to

a specialist

in

foreign currency options on a stock exchange.
interested persons may express
the proposed activity, conducted
basis

proposed,

is

as

to be a proper

whether

the proposal as a whole can

produce

benefits

increased
possible

to

the

competition
adverse

public,

or

effects,

gains
such

views on whether

through a joint venture on the

"so closely related

or controlling banks

their

as

incident

thereto,"

and

"reasonably be expected

such
in

to banking or managing

as greater

efficiency,
undue

to

convenience,

that

outweigh

concentration

of

-3 -

resources,

decreased

interests,

or

hearing on

these questions

unsound

or

unfair

banking

competition,

practices."

conflicts

Any

request

of
for

must be accompanied by a statement

of the reasons why a written presentation would not suffice
lieu of

a hearing,

fact

that are

be

presented

identifying

in dispute,
at

a

a

specifically

summarizing

hearing, and

any questions

the evidence

indicating how

the

in
of

that would
party

commenting would be aggrieved by approval of the proposal.
The application may

be inspected at the offices of

the

Board of Governors or the Federal Reserve Bank of New York.
Any views or requests
in writing

and

of Governors

of

received

the Federal

of

should be submitted

by William w. Wiles,

20551, not later than May 28,
Board

for hearing

Governors

Reserve

System,

Secretary,

Board

Washington,

D.C.

1985.
of

the

Federal Reserve

System,

April 23, 1984.

William W. Wiles
Secretary of the Board


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102