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F ederal reserve Bank of Dallas
DALLAS, TE X A S
75222
Circular No. 83-29
February 28, 1983
REGULATION L
MANAGEMENT OFFICIAL INTERLOCKS
(Final Rule)
TO ALL MEMBER BANKS
AND OTHERS CONCERNED IN THE
ELEVENTH FEDERAL RESERVE DISTRICT:
The Board of Governors of the Federal Reserve System has amended its
Regulation L (Management Official Interlocks) to clarify the circumstances under
which certain interlocks among depository institutions may be continued until 1988.
A ttached is a copy of the m aterial as published in the Federal Register
on February 7, 1983. Questions concerning the m aterial contained in this circular
should be directed to the Legal D epartment, Extension 6228.
Additional copies of this circular will be furnished upon request to the
Public Affairs D epartment, Extension 6289.
Sincerely yours,
William H. Wallace
First Vice President
Banks and others are encouraged to use the follow ing incom ing WATS numbers in con tacting this Bank:
1-800-442-7140 (intrastate) and 1-800-527-9200 (interstate). For calls placed 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
December 29, 1982
The Federal Reserve Board today announced adoption in final form of
an amendment to its Regulation L —
Management Official Interlocks —
clarifying
the circumstances under which certain interlocks among depository institutions
may be continued until 1988.
The Board and the other Federal depository institutions supervisory
agencies proposed this amendment to their regulations in October.
The revised
rule is being adopted by the five agencies as proposed.
The amendment to Regulation L will become effective upon publication
jointly by the five agencies in the Federal Register, expected about the middle
of January.
Following is the amended Section 212.5 of Regulation L:
Grandfathered interlocking relationships
A person whose interlocking service in a position as a management
official of two or more depository organizations began prior to
November 10, 1978, and was not immediately prior to that date in
violation of Section 8 of the Clayton Act is not prohibited
from continuing to serve in such interlocking positions
until November 10, 1988. Any management official who has been
required to terminate or who has terminated service in one or more
such interlocking positions as a result of a merger, acquisition,
consolidation, or establishment of an office that formerly was defined
as a change in circumstances in Section 212.6(a)
(1981) is not
prohibited from continuing or resuming such service until November 10,
1988.
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0-
FE D ER A L R E SER VE SYS TE M
[12 C.F.R. PART 212]
D E P A R T M E N T OF THE TR EA S U R Y
C O M P T R O L L E R OF THE C U RR EN CY
[12 C.F.R. PART 26]
FE DE RA L DE P O S I T INS UR ANC E C O R P O R A T IO N
[12 C.F.R. PART 348]
FE DER AL HOME LOAN BANK BOARD
[12 C.F.R. PART 5 6 3 f ]
N A T I O N A L C RE D I T U N IO N A D M I N I S T R A TI ON
[12 C.F.R. PART 711]
Docket No. 82 M A N A G E M E N T O F F I CI AL INTERLOCKS
AGENCIES:
Board of G o v e rn or s of the Federal
Com pt ro ll er of the Currency,
tion,
Federal
Federal
Home Loan Bank Board,
Deposit
Reserve System,
Insurance C o r p o r a
and National Credit Union
Administra tio n.
ACTION:
Final
SUMMARY:
Rule.
The Federal
Federal Deposit
respective
terminated
Federal Home Loan Bank
Cre di t Uni on A d m i n i s t r a t i o n are amending
re gu lat ion s
In sti tut ion Ma na g e m e n t
to permit
Co m p t r o l l e r of the Currency,
Insur anc e Cor poration,
Board and Nat ion al
their
Reserve Board,
imple me nti ng
Interlo cks Act,
the D e p o si to ry
12 U.S.C.
§ 3201
e_t s e q . ,
a ma na g e m e n t off icial of a d e p o s i t o r y o r g a n i z a t i o n who
a gr a n d f a t h e r e d
circumst anc es,
as de fin ed
interlock because of a cha ng e
by the agencies,
for the du r a t i o n of the g r a n d fat he r
agencie s are ex te n di ng
to resume the
per io d under
the Act.
to such m a n a g e m e n t of f i c i a l s
in
interlock
The
the benefit
2
-
-
of a sta tutory a me nd men t to the Act,
of f ic ia l s c u r r e n t ly
con tinue
serving
wh ic h permi ts ma na ge me nt
in g r a n d f a t h e r ed
such service until November
occ ur re n ce of a chang e
EF F EC TI V E DATE:
p ub l i c a t i o n
1988, d e sp it e
the
in circumstances.
The a m e nd me nt
is immediat ely effe ct ive
upon
in the Federal R e g i s t e r .
FOR F U R T H E R INF OR MA TI ON CONTACT:
M e l a n i e Fein
(202)
Reserv e System;
Com p t r o l l er
or Ba rb a ra
10,
interlocks to
452-3594,
of the Currency;
Corporation;
(202)
(202)
452-3564 or
Board of Go v e r no rs of the Federal
Ros ema ri e Oda
I. G ers ten
B r on we n M a s o n
(202)
447-1880,
Pamela E.F.
389-4171,
David J. Bristol
(202)
Off ic e of the
LeCren
Federal
(202)
389-4171,
Depos it
Insurance
377-6461 or Ke nne th F. Hall
(202)
377-6466,
Federal Home Loan Bank Board;
(202)
357-1030,
National C r ed it Un ion Adm inistration.
S UP P L E M E N T A R Y
110 was
signed
Management
INFORMATION:
On December
into law amending
Interlocks Act
26,
1981,
the De po s i t o r y
("Interlocks Act"),
s e q . , to p ro vid e that mergers,
or Steven R. Bisker
acquisitions,
Public Law 97
Institution
12 U.S.C.
consolidations
the e s t a b l i s h m e n t of of f i c e s do not c o ns t i t u t e c h an ge s
ci r c u m s t a n c e s
locks.
that require
C ons eq uen tl y,
re gu la ti on pu bl ish ed
and
in
te r m i n a t io n of gr an df a t h e r e d
in a final
§ 3201 et
in ter
at 47 Fed.
-
Reg.
47369
whi ch
(October
specified
ci rc um s t a n c e s
that
con tin ue
1982)
-
the agencies
re scinded pr ov is io ns
those events c o ns tit ute d change s
requiring
This action had
cu rr en tl y
26,
3
t e r m i nat io n of g r an df at he re d
the effect of p er mi tt in g man ag em en t
serving
in gr an df a t h e r e d
interlocks.
of fi cia ls
inter loc kin g po si tio ns
such service until Nov ember
oc cu rr en ce of a merger,
in
10,
consolidation,
1988, despit e
the
ac q u i s i t io n or
to
the
es ta bl i s h m e n t of an office.
This
related
who termina ted
Under
Act,
final
their
the rulemaking
12 U.S.C.
regu lat ion s
in ter locking
int erlocking
service
service
the age ncies are amending
such ma na ge me nt
for
reason other
of fi ci al s
than a chan ge
any per son wh o resigned
or o t h er w is e
change
termina te d
in ci rc um s t a n c e s
not be p e r m i t t e d
respective
to resume
their
interlock
in ci r c u m s t a n c e s enu me ra te d
to resume
the interlock.
from a g r a n d f a t h e r e d
such service
for
reasons other
interlock
than a
after e n a ct me nt of the a m e nd me nt would
to resume
The ag en ci es believe
the C o ng re ss io na l
their
a gr an df a t h e r e d
in the reg ulations would not be pe rm itt ed
Similarly,
such service.
the d u ra ti on of the gr an dfa the r period.
A m an ag em en t official who termina ted
for some
to resume
au th ori ty gr ant ed by § 209 of the Interlocks
§ 3207,
to permit
re gul ati on allows m a na g e m e n t o f fi ci als
the
that
inte rl ock ing
service.
this a m e n d m e n t
intent und er l y in g
is co ns is te nt with
the st at uto ry am en dme nt
to
-
4
-
afford an u n in te rr up te d g r a n d fat he r
were
in ex is te n ce wh en
intent was ex pr es se d
period
to resume
the d u ra ti on of the gra nd fa th er
15,
1981)
Interes ted pe rso ns were
re gul ati on
Octobe r
for
26,
received.
chan ge
invited
47 Fed.
The commenters'
of the amendment.
that man ag em en t
interlocking
period.
127 Cong.
ci r c u m s t a n c e s by listing
included
in that phr as e
Rec.
S.
for
15309
from the date of p u b l i c a t i o n on
Reg.
47404.
F o ur te en com men ts were
rea ction was o v e r w h e l m i n g l y
In response
the ref erence
service
to comment on the proposed
to one comment
in the lan guage of the amendment,
cl ar if ie d
This
(remarks of Senator G a r n ) .
thirty days
1982.
that
in a st atement during C on gre ss ion al
o f f i ci al s would be per mi tt ed
Dec.
interlocks
the Interl oc ks Act was enacted.
co n s i d e r a t i o n of the st at ut ory am endment
(daily ed.
for
in favor
recommending
the agencies have
to the former d e f i n i t io n of change
the types of
transa cti ons
that no longer
a
in
that were
apply to g r a n d f a t h er ed
interlocks.
The ame nd me nt s
U.S.C.
date
are made effe ct ive
553(d)(1),
to 5
w h i ch a u t h or iz es waiver of a de lay ed effe cti ve
in the case of a su bs tan tiv e
an e x e mp ti on or
i m me dia tel y pur sua nt
rule wh ic h gran ts or
recognizes
relieves a restriction.
R e g u l a t o r y F l e x i b i l i t y Act A n a l y s i s .
Pu rsuant
(Pub.
to sectio n
605(b)
of the R e g u l a t o r y F l e x i b i l i t y Act
L. No.
96-354,
U.S.C.
§ 601 e_t s e q .) , the Board of Go ve rn or s of the Federal
5
-
Re s e r v e System,
5
-
the Se c r et a r y of the Treasury,
the B oa rd of
Di r e c t o r s of the Feder al D e p o s i t Insu ra nce Corporation,
Federal Home Lo a n Bank Board,
the
and the B oa rd of Di re ct or s of the
Na tional Cre dit Union A d m i n i s t r a t i o n certi fy that the amen dm en t
will
not have a si gn if ica nt ec on o m ic
number of small entities.
impact on a substantial
The a m e nd me nt w o u l d ease the
app l i c a t i o n of the e x i st i ng regulations.
am e n d m e n t
is ex pe c t e d to be b en efi ci al
The effect of the
rather than advers e and
small ent ities are ge n e ra l ly exp ec te d to share the ben efi ts of
the am en d m e nt equally wi th
larger institutions.
R e g u l a t o r y Impact A n a l y s i s .
Executive Order
12291 of F e b r u a r y
Pur su an t
17,
to Se ct io n
1981,
3(g)(1)
it has been d e t e r m i n e d
that the am en dme nt does not con st it ut e a ma jo r rule w i t h i n
me a n i n g of S ec tio n
1(b)
eases res tri ct i on s
imposed by re g ul at io ns
of
of the E x e c u t i v e Order.
the
The amen dm en t
imp lem en ti ng the
D e p o s i t o r y I n s ti tu ti on M a n a g e m e n t I nt er lo ck s Act,
12 U.S.C.
§ 3201 et s e q ., and w o u l d have no a d ver se eff ec t on the
op er at io ns of the de po s i t o r y
such,
insti tut ion s subje ct to it.
As
the a me ndm en t w o u ld not have an annual effec t on the
ec on om y of $100 m i l l i o n or more,
for consumers,
individual
g eo gr a p h i c regions,
competition,
w o u l d not aff ec t cost or prices
industries,
g o ve rn m e n t ag en cie s or
and w o u l d not have ad v e r se effec ts on
employment,
investment,
pro ductivity,
ab il it y of Un it e d States b a se d e n t e r p r i se s
forei gn ba se d ent erp ris es
or on the
to compet e wit h
in do m e s t i c or exp or t markets.
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6
-
List of Su bj ec ts
12 C FR Part 26
Nationa l
banks,
12 C F R Part
Antitrust,
12 C F R Part
Antitrust,
H ol di ng
M an ag e m e n t official
interlocks.
212
Holding companies.
348
Banks,
Banking,
Federal
Depos it
Insurance Corporation,
companies.
12 C F R Part
Antitru st,
563f
S av ing s and loan associations.
12 C F R Part 711
Antitru st,
Cr ed i t unions.
Accor din gl y,
pu rsu ant
to their
section 209 of the D e p o s i t o r y
Act
(12 U.S.C.
Re ser ve System,
Deposi t
§ 3207),
respective a u th or ity under
I n s t it ut io n M a n a g e m e n t
Interlocks
the Board of Go v e r no rs of the Federal
the C o m p t r o l l e r of the Currency,
Insurance Corp or at io n,
the Federal
the Federal Home Loan Bank Board,
and the Na ti o na l Cr ed it U ni on A d m i n i s t r a t i o n amend 12 C.F.R.
amending Parts
follows:
212,
26,
348,
563f,
and 711,
respectively,
as
by
FEDERAL RESERVE SYSTEM
[12 C.F.R. PART 212]
MANAGEMENT OFFICIAL INTERLOCKS
FINAL RULE
12 C.F.R. Part 212 is amended as follows:
1.
The authority citation for Part 212 reads as follows:
Authority:
2.
12 U.S.C. § 3201 et seq.
Section 212.5 is amended by revising it as follows:
Section 212.5 - Grandfathered interlocking relationships
A person whose
interlocking
service
in a position
as a management
official of two or more depository organizations began prior to November 10,
1978, and was not immediately prior to that date in violation of Section 8
of the Clayton Act
serve
in
such
(15 U.S.C. § 19)
interlocking
is not prohibited from continuing to
positions
until
November 10,
1988.
Any
management official who has been required to terminate or who has terminated
service in one or more such interlocking positions as a result of a merger,
acquisition, consolidation, or establishment of an office that formerly was
defined as a change in circumstances in 12 C.F.R. § 212.6(a)
(1981) is not
prohibited from continuing or resuming such service until November 10, 1988.
By order of the Board of
Governors of
the Federal
Reserve
effective January 19, 1983.
(signed) William W. Wiles
William W. Wiles
Secretary of the Board
[SEAL]
System,
