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FEDERAL R E SE R V E BANK OF DALLAS
Station K, Dallas, Texas 7 5 2 2 2
Circular No. 84-118
December 4, 1984
TO:
All
member
banks, holding companies and others
concerned in the Eleventh Federal Reserve District
ATTENTION:
Chief Executive Officer
SUBJECT:
Application by Bankers Trust of New York to execute
and clear futures on a municipal bond index and to
provide related futures advisory services through its
subsidiary, BT Futures Corp.
SUMMARY:
The Board of Governors of the Federal Reserve System
is requesting comments on an application by Bankers
Trust New York Corporation to execute and clear
futures contracts on a municipal bond index and to
provide related futures advisory services through its
subsidiary, BT Futures Corp. These activities would
be performed through BT Futures Corp. offices in New
York, Chicago, Los Angeles, Dallas and
Houston.
Interested parties are invited to submit their views
to the Secretary, Board of Governors of the Federal
Reserve
System,
Washington,
D.C.
20551,
by
December 14, 1984.
ATTACHMENTS:
Board's press release and Federal Register document
MORE INFORMATION:
Legal Department, Extension 6171
ADDITIONAL COPIES:
Public Affairs Department, Extension 6289
Banks and others are encouraged to use the following Incoming WATS numbers in contacting this Bank: 1-800-442-7140
(intrastate) and 1-800-527-9200 (interstate). For calls plaped locally, please use 651 plus the extension referred to above.
This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
FEDERAL RESERVE press release
For immediate release
November 20# 1984
The Federal Reserve Board today requested comment on
an application by Bankers Trust New York Corporation to expand
the scope of the activities of its subsidiary, BT Futures
Corp., which engages in futures commission merchant activities.
The Board has previously approved futures commission
merchant activities as permissible under the Bank Holding
Company Act but has not previously approved the proposed new
activities of executing and clearing municipal bond index
futures and providing related advisory services.
The proposal is set forth in the accompanying notice.
The Board requested comment by December 14, 1984.
Attachment
FEDERAL RESERVE SYSTEM
BANKERS TRUST NEW YORK CORPORATION
Proposal to Execute and Clear Futures on a Municipal
Bond Index and to Provide Futures Advisory Services
Bankers
York,
has
Holding
Trust
applied,
Company
New York
pursuant
Act
(12
to
Corporation,
New
section 4(c)(8)
U.S.C.
of
§ 1843(c)(8))
York,
the
New
Bank
and
sections 225.23(a)(2)
and
(3) of the Board's Regulation Y
C.F.R.
and
(3)),
clear
§ 225.23(a)(2)
futures
contracts
(12
for permission to execute and
on a municipal bond
index on major
commodities exchanges for nonaffiliated persons,
and to provide
advice with respect to futures and options that the Board has
permitted
futures
commission merchant
("FCM") subsidiaries of
bank holding companies to execute and clear.
These activities
would be performed through the applicant's FCM subsidiary,
Futures Corp.,
Illinois,
through offices in New York,
Los Angeles,
and London, England,
California,
New York,
BT
Chicago,
Dallas and Houston,
Texas,
serving customers in the United States and
abroad.
Section
4(c)(8)
of
the
Bank
Holding
provides that a bank holding company may,
Company
Act
with Board approval,
engage in any activity "which the Board after due notice and
opportunity for hearing has determined
(by order or regulation)
to be so closely related to banking or managing or controlling
banks
as
to be a proper
incident
thereto."
The
Board has
-
2-
previously approved of the provision of advisory services with
respect to futures and options where the underlying
products
are
securities,
bullion,
foreign
or money market
Incorporated, 70
Federal
exchange,
U.S.
instruments.
Reserve
Board has not previously approved
government
J.P.
Bulletin
financial
Morgan & Co.,
780
(1984).
The
the proposed execution and
clearance of futures contracts on a municipal bond index or the
provision
that
of
these
managing
advisory
activities
or
thereto.
related
are
controlling
services.
so closely related
banks
In Applicant's
Applicant
as
opinion,
to be
a
believes
to banking
proper
the brokerage
incident
of municipal
bond index futures and advisory services with respect
are
similar
to the brokerage
of
financial
or
futures
thereto
and
the
provision of futures advisory services previously approved by
the
Board.
activities
Applicant
are
similar
also
to
believes
municipal
that
the
securities
proposed
activities
performed by banks.
Interested persons may express their views on whether
the
proposed
activities
of
executing
contracts on a municipal bond
thereon are
"so closely
controlling banks
as
and
clearing
futures
index and of providing advice
related
to banking
to be a proper
or
incident
managing
or
thereto," and
whether the proposal as a whole can "reasonably be expected to
produce benefits
increased
possible
to the public,
competition or gains
adverse
effects,
such
such as greater convenience,
in efficiency,
as
undue
that
outweigh
concentration
of
-
3-
resources, decreased or unfair competition, conflicts of
interests, or unsound banking practices."
Any request for a
hearing on these questions must be accompanied by a statement
of the reasons why a written presentation would not suffice in
lieu of a hearing,
identifying specifically any questions of
fact that are in dispute,
summarizing the evidence that would
be presented at a hearing, and indicating how the 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 for hearing should be submitted
in writing and received by the Secretary, Board of Governors of
the Federal Reserve System, Washington, D.C. 20551, not later
than December 14, 1984.
Board of Governors of the Federal Reserve System,
November 20, 1984.
(signed) William W. Wiles
William W. Wiles
Secretary of the Board
