The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
FE D E R A L R E SE R V E BANK O F N E W YORK C ircu lar No. 9 1 0 1 Ju ly 1, 1981 [ ] REGULATION Y Comment Invited on Proposal to Permit the Issuance of Travelers Checks by Bank Holding Companies To A ll Bank Holding Companies, and Others Concerned, in the Second Federal Reserve D istrict; The Board of Governors of the Federal Reserve System has invited comment on a proposal to amend its Regulation Y, “Bank Holding Companies and Change in Bank Control,” in order to include the issuance of travelers checks on the list of activities generally permissible to bank holding companies. Printed on the reverse side is the text of the Board’s proposal, which has been reprinted from the F e d e ra l R e g is te r . Comments must be submitted by August 31, 1981, and may be sent to our Domestic Banking Applications Department. A nthony M. S o lo m o n, President. (over) FE D E R A L R E SE R V E SY STEM [12 C.F.R. Part 225] [Regulation Y; Docket No. R-0361] B A N K H O L D IN G C O M PA N IE S N O N B A N K IN G A C T IV IT IE S Issuance of T rav elers Cheeks N otice of P ro p o sed R u lem aking 1 2 C F R Part 225 [Regulation Y; Docket No. R-0361] Bank Holding C om panies Nonbanking Activities; Issuance o f Travelers C hecks Board of Governors of the Federal Reserve System. ACTION: Proposed rulemaking.________ I AGENCY: In the past, the Board has approved applications by bank holding companies filed pursuant to section 4(c)(8) of the Bank Holding Company Act, 12 U.S.C. 1841 e t seq., and § 225.4(b)(2) of the Board’s Regulation Y, 12 CFR 225.4(b)(2), to engage in the issuance of travelers checks. At this time, the Board will consider a proposed rule that would amend § 225.4(a)(13) of its Regulation Y, 12 CFR 225.4(a)(13), by adding the issuance of travelers checks to the list of nonbanking activities permissible for bank holding companies. SUMMARY: DATE: Comments must by received by August 31,1981. ADDRESS: Secretary, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. All material submitted should include the docket number R-0361. FOR FURTHER INFORMATION CONTACT: R. Whiting, Senior Attorney (202/4523779) or S. Weinberg, Attorney (202/4523707), Legal Division, or S. Sussan, Manager, Division of Banking Supervision and Regulation (202/4522818), Board of Governors of the Federal Reserve System, Washington, D.C. 20551. SUPPLEMENTARY INFORMATION: (1) P roposed Rulem aking. The Board is inviting comment on whether § 225.4(a)(13) of the Board’s Regulation Y (12 CFR 225.4(a)(13)) should be amended to add the issuance of travelers checks to those activities permissible generally for bank holding companies under section 4(c)(8) of the Bank Holding Company Act. Section 4(c)(8) of the Bank Holding Company Act states that bank holding companies lawfully may engage in those activities the Board has "determined (by order or regulation) to be so closely related to banking or managing and controlling banks as to be a proper incident thereto.” 12 U.S.C. 1843(c)(8). In determining whether a proposed nonbanking activity is "closely related” to banking, the Board generally applies the standards set forth in N a tio n a l C ou rier A sso c ia tio n v. B o a rd o f G o vern ors o f th e F ed era l R e se r v e S yste m , 516 F.2d 1229 (D.C. Cir. 1975). In that opinion the Court held that a proposed nonbanking activity would be considered “closely related” to banking if it met at least one of the following criteria: (1) Banks generally have in fact provided the proposed services. (2) Banks generally provide services that are operationally or functionally so similar to the proposed services as to equip them particularly well to provide the proposed service. (3) Banks generally provide services that are so integrally related to the proposed services as to require their provision in a specialized form. On several occasions the Board by order has found the conduct of this activity by particular bank holding companies to be “closely related” to banking. S ea first C o rp o ra tio n ----Federal Reserve Bulletin----- (1981) (“Seafirst”); The C h ase M an h attan C orporation 66 Federal Reserve Bulletin 983 (1980); F irst C hicago C orporation 65 Federal Reserve Bulletin 937 (1979); C itico rp 65 Federal Reserve Bulletin 666 (1979); and R e p u b lic o f T exas C orporation 62 Federal Reserve Bulletin 630 (1976). Thus, in the circumstances presented, the Board has concluded that sufficient evidence exists to warrant a finding that there is a reasonable basis for the opinion that the issuance of travelers checks by bank holding companies generally is an activity “closely related” to banking and now solicits comments as to whether the activity of issuing travelers checks should be added to section 225.4(a) of Regulation Y. (2) S u b m issio n o f Com m ents. To aid the Board in its consideration of the proposed rulemaking, interested persons may express their views on the question whether performance of the proposed activity generally by an affiliate of a bank holding company, is so “closely related to banking or managing or controlling banks as to be a proper incident thereto” within the meaning of section 4(c)(8) of the Bank Holding Company Act. Any request for a hearing on this question should be accompanied by a statement summarizing the. evidence the person requesting the hearing proposes to submit or to elicit at the hearing and a statement of the reasons why this matter should not be resolved without a hearing. Any views or requests for a 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 August 31,1981. All material submitted should include the docket number R-0361. Such information will be made available for inspection and copying upon request except as provided in § 261.6(a) of the Board’s Rules Regarding Availability of Information (12 CFR 261.6(a)). (4) A u th ority. This action is proposed pursuant to the Board’s authority under section 4(c)(8) of the Bank Holding Company Act (12 U.S.C. 1843(c)(8)). Section 225.4(a)(13) of the Board’s Regulation Y (12 CFR 225.4(a)(13)) would be revised as follows: § 225.4 Nonbanking activities. (a) A c tiv itie s c lo s e ly r e la te d to ban kin g o r m anaging a n d controlling banks. * * * The following activities have been determined by the Board to be so closely related to banking or managing and controlling banks as to be a proper incident thereto. * * * * * (13) The sale at retail of money orders having a face value of not more than $1,000 and the issuance and sale of travelers checks and the sale of U.S. Savings Bonds. Board of Governors, effective June 18,1981. James McAfee, Assistant Secretary of the Board. (FR Doc. 81-18671 Filed 6-23-81; 8:45 am] BILLING CODE 6210-01-M P R I N T E D IN NEW YORK, FROM F E D E R A L R E G I S T E R , VOL. 4t>, NO. 121
@FedFRASER