[Federal Register Volume 59, Number 211 (Wednesday, November 2, 1994)]
[Rules and Regulations]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-27057]
[[Page Unknown]]
[Federal Register: November 2, 1994]
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FEDERAL RESERVE SYSTEM
12 CFR Part 225
[Regulation Y; Docket No. R-0852]
Applications Under Regulation Y
AGENCY: Board of Governors of the Federal Reserve System.
ACTION: Interim rule with request for comments.
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SUMMARY: These rules are intended to implement the simplified notice
procedures recently established under section 346 of the Riegle
Community Development and Regulatory Improvement Act of 1994 for bank
holding companies proposing to engage de novo or through an acquisition
in nonbanking activities. Because Section 346 implements this procedure
immediately, the Board has proposed the following as an interim rule
that will take effect immediately and will apply to all notices filed
subsequent to enactment of Section 346. The Board also is seeking
comments on the interim rule, and will amend the rule as needed to
address the comments received. The Board is currently developing
additional initiatives to reduce the regulatory burden associated with
its application and notice procedures, and the Board invites comment on
any suggestions in furtherance of these initiatives.
DATES: Interim rule effective on November 2, 1994, comments must be
received by December 5, 1994.
ADDRESSES: Comments should refer to Docket No. R-0852 and may be mailed
to William W. Wiles, Secretary, Board of Governors of the Federal
Reserve System, 20th Street and Constitution Avenue, NW, Washington, DC
20551. Comments also may be delivered to Room B-2222 of the Eccles
Building between 8:45 a.m. and 5:15 p.m. weekdays, or to the Board's
Security Control Room inside the Eccles Building courtyard on 20th
Street (between Constitution Avenue and C Street, NW) anytime. Comments
may be inspected in room MP-500 of the Martin Building between 9 a.m.
and 5 p.m. weekdays, except as provided in 12 CFR 261.8 of the Board's
rules regarding availability of information.
FOR FURTHER INFORMATION CONTACT: Scott G. Alvarez, Associate General
Counsel (202/452-3583), or Terence F. Browne, Senior Attorney (202/452-
3707), Legal Division; or Don E. Kline, Associate Director (202/452-
3421), Nicholas A. Kalambokidis, Supervisory Financial Analyst (202/
452-3830), or Larry R. Cunningham, Senior Financial Analyst (202/452-
2701), Division of Banking Supervision and Regulation of the Board of
Governors of the Federal Reserve System. For the hearing impaired only,
Telecommunications Device for the Deaf (TDD), Dorothea Thompson (202/
452-3544).
SUPPLEMENTARY INFORMATION: Section 4 of the Bank Holding Company Act of
1956 (12 U.S.C. 1843) (BHC Act) prohibits bank holding companies from
acquiring or retaining shares of any company that is not a bank or
engaging in any activity other than managing and controlling banks,
except under certain circumstances. The primary exception permits bank
holding companies to conduct activities and acquire companies engaged
solely in activities the Board has determined to be closely related to
banking and a proper incident thereto. See 12 U.S.C. 1843(c)(8).
Section 346 of the Riegle Community Development and Regulatory
Improvement Act of 1994 (Pub. L. No. 103-325, section 346, 108 Stat.
2160, 2239 (1994)(``Section 346'')) amends section 4 of the BHC Act to
establish a new notice procedure for obtaining Board approval under
sections 4(a)(2) and 4(c)(8) of the BHC Act.\1\ Under Section 346, a
proposal requiring Board approval under section 4(a)(2) or 4(c)(8) may
be consummated 60 days after providing the Board with a complete
written notice of the proposal, unless the notice period is extended as
provided in the statute. Section 346 also permits proposals to be
consummated at anytime during this notice period if approved by the
Board during this period.
\1\Section 346 establishes a notice procedure for situations in
which prior Board approval is required under section 4(c)(8) or
4(a)(2) of the BHC Act, and was not intended to impose any new
approval requirements on transactions that may otherwise be
consummated under section 4 of the BHC Act without Board approval.
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The proposed interim rule would replace the current application
procedure of section 4(c)(8) of the BHC Act with the new notice
procedure.\2\ The rule would streamline the current procedure for
obtaining Board approval for nonbanking proposals in several respects.
In particular, the proposed revisions would:
\2\All applications and notices to engage in nonbanking
activities that were filed with a Reserve Bank prior to September
23, 1994 will continue to be processed under the existing rules.
Establish a simplified notice procedure for action on
proposals to engage de novo or through an acquisition in a listed
activity (i.e., an activity on the Regulation Y list of permissible
nonbanking activities\3\) within 30 days of receipt of the notice by
the Reserve Bank;
\3\12 CFR 225.25.
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Establish a notice procedure for action on proposals to
engage de novo or through an acquisition in an un-listed activity or
a new activity within 60 days of filing of a complete notice;
Eliminate the current 28 day pre-acceptance period for
notices involving nonbanking proposals;
Reduce from 30 days to 15 days the public comment
period for proposals involving listed activities; and
Specify in the regulation the core information that
bank holding companies must provide for a nonbanking proposal.
These revisions to the current application procedures should result
in an overall reduction in the total period of time involved in
reviewing nonbanking proposals, and in a reduction in the paperwork
burden associated with proposals to engage in nonbanking activities.
Comment is invited on all aspects of this proposal.
Notice Procedure Under Interim Rule
To implement these statutory changes, the Board proposes to amend
Regulation Y to replace the application procedures for obtaining
approval to engage in nonbanking activities with a notice procedure.
The interim rule contemplates action by the Reserve Bank on nonbanking
proposals involving listed activities within 30 days after a notice
containing all of the information required in the rule has been
received by the Reserve Bank, in cases that qualify for Reserve Bank
action, and within 60 days of that date in cases involving any
previously approved activity that are subject to Board action. While
the rule also indicates that the Board will seek to act on notices
involving new activities within 60 days of receipt of the notice by the
Reserve Bank, proposals that involve activities that have not been
previously approved by the Board often require substantial information
and may continue to require a greater processing period.
The interim rule specifies the different types of information
required for proposals to engage de novo in listed activities,
proposals to acquire a company engaged in listed activities, and
proposals to engage in activities not previously approved by regulation
(``unlisted activities'').
Listed Activities
The proposed rule contemplates that proposals to engage de novo or
to acquire a company engaged in a listed activity will be approved
within 30 days of the original date of filing of the notice, even if
additional information is subsequently requested by the Reserve Bank or
the Board. Upon receipt of a notice to engage in or to acquire a
company engaged in a listed activity (or an activity previously
approved by order), the Reserve Bank shall immediately notify the
Board, and the Board will publish notice of the proposal in the Federal
Register inviting public comment for a period of 15 days. Within 30
calendar days after receipt by the Reserve Bank of a notice filed under
the interim rule, the Reserve Bank must approve the notice, extend the
notice period for 15 calendar days, or refer the notice to the Board
for decision because a substantive comment on the proposal has been
received or action on the notice by the Reserve Bank is not
appropriate. The Reserve Bank also may, within 15 calendar days of
receipt of the notice, return the notice if it is informationally
incomplete. Under the interim rule, the return of a notice by a Reserve
Bank under such circumstances is deemed action on the notice.
Unlisted Activities
As is the practice under the current rules, proposals to engage in
activities not previously approved by the Board by regulation or order
will be published by the Board in the Federal Register within 10
business days of acceptance by the Reserve Bank, unless the Board
determines to extend this 10-day period for an additional 30 days.
Public notice of proposals to engage in such new activities shall
invite comment for a period of generally 30 days, or if the Board
determines that the notificant has not adequately demonstrated that the
proposed activity is so closely related to banking as to be a proper
incident thereto, the Board may return the notice and explain the
reasons for its determination.
The interim rule provides that the Board will attempt to act on all
cases referred for Board action within 60 days of the date the notice
is received by the Reserve Bank. As noted above, proposals that involve
new activities that have not been previously approved by the Board are
likely to require a greater processing period. In the event the Board
does not act on the notice within 60 days of receipt by the Reserve
Bank, the Board will notify the bank holding company, and explain the
reasons for needing additional time as well as provide an anticipated
date by which the Board expects to act on the notice.
Elimination of Pre-Acceptance Review Period
As noted above, the interim rule eliminates the pre-acceptance
review procedure currently contained in Regulation Y for proposals to
engage in nonbanking activities. This procedure established a defined
period of up to 28 days during which an applicant and the Reserve Bank
could identify and address significant issues prior to the filing of a
final application. This procedure has been particularly beneficial to
the processing of complex proposals and applications to engage in
activities not previously approved by the Board by regulation or order,
where information requests often must be tailored to the specific
proposal.
While the elimination of pre-acceptance procedures should shorten
the review process, the Board recognizes the utility of a pre-
acceptance procedure and anticipates that there will be certain
proposals that could benefit from some form of pre-acceptance review.
The Board invites comments as to whether some form of pre-notice review
procedure should be reinstated in the final regulations.
Public Notice
Regulation Y currently provides that (with the exception of
proposals processed under the abbreviated procedure for small
acquisitions) all proposals to engage in previously approved nonbanking
activities must be published in the Federal Register and provide for a
public comment period of not more than 30 days. Under the interim rule,
the public comment period has been shortened from 30 days to 15 days
for proposals to engage in activities previously approved by the Board
by regulation or order. The interim rule also provides that the Reserve
Bank may not act on a notice before the fifth business day following
the close of the public comment period unless an emergency exists
requiring expedited or immediate action.
Section 346 authorizes the Board to prescribe shorter notice
periods by regulation for particular activities or transactions. The
Board invites comment on whether further shortening of the comment
period is appropriate, particularly for notices to engage in activities
previously approved by the Board. In particular, the Board requests
comment on a proposal to reduce the public comment period to 5 calendar
days for proposals that involve listed activities and/or activities
that have been previously approved by Board order. This would enable
the Reserve Banks to act on proposals that raise no substantive issues
well within the 30-day target.
Statutory Period
The interim rule incorporates the provisions of Section 346 that
establish the permissible length of the notice period. Under the
interim rule, a notice is deemed approved by operation of law 60 days
after receipt of a complete notice, unless extended as provided in
Section 346. As provided in the statute, the interim rule provides that
a notice is deemed complete when it contains all information required
in the interim rule and all other information requested by the Board or
the Reserve Bank in connection with the notice. The Board may extend
the notice period for an additional 30 days upon notice to the bank
holding company. If the proposal involves an unlisted activity, the
Board may extend the notice period for a 90-day period in addition to
the 30-day extension, provided the Board notifies the bank holding
company and explains the reasons for this additional extension. Further
extensions are only permissible in the event the Board determines to
conduct a hearing on the proposal, or the notificant has consented to
an extension or tolling of the notice period.
The interim rule adopts the provision in Section 346 that permits
the Board to request additional information about a proposal at any
time during the notice period. The rule also includes the provision of
Section 346 that provides that the Board may deny any notice if the
notificant neglects, fails, or refuses to furnish the Board all the
information required by the Board.
Abbreviated Notice Procedure for Small Acquisitions
The interim rule retains the current abbreviated notice procedure
contained in Regulation Y for small acquisitions of assets or shares of
companies engaged in activities previously approved by the Board by
regulation.\4\ Currently, this abbreviated notice procedure may be used
for acquisitions where neither the book value of the assets to be
acquired nor the gross consideration to be paid for the securities or
assets exceeds the greater of (i) $15 million or (ii) 5 percent of the
consolidated assets of the acquiring company up to a maximum of $100
million. The interim rule retains this abbreviated notice procedure for
small acquisitions of companies engaged in laundry list activities, and
increases the size limitation for acquisitions that qualify for this
procedure from a maximum of $100 million to a maximum of $300 million.
\4\This procedure is only available to bank holding companies
that meet the Board's Capital Adequacy Guidelines and are proposing
to acquire a company engaged in activities for which the bank
holding company has previously received System approval.
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The primary benefit of the abbreviated notice procedure for small
acquisitions is the shortened approval process realized by opting to
publish public notice of the proposal in local newspapers in the
communities affected by the proposal. Since this provision of
Regulation Y was adopted, notificants have increasingly opted to
publish notice of the proposed acquisition in the Federal Register in
order to conduct the nonbanking activity nationwide or throughout a
geographic area so large that public notice of the proposal by means of
local newspaper publication is unduly expensive or impracticable.
Moreover, the streamlined notice procedure established by the interim
rule would effectively shorten the notice period for all acquisitions
involving listed activities.
In light of this, the Board invites comment as to whether the
abbreviated notice procedure for small acquisitions should be retained,
eliminated, or amended.
Simplified Notice Procedures
The Board believes that these proposals will substantially reduce
the burden associated with the approval requirement under section 4 of
the BHC Act without resulting in unsafe and unsound banking practices.
Because the provisions of Section 346 are implemented immediately, the
Board is proposing to adopt the following regulation as an interim rule
in connection with nonbanking activities conducted pursuant to section
4 of the BHC Act. The Board invites comments on all aspects of this
interim rule, and will amend this rule as needed to reflect the
comments received. The Board also invites suggestions on other means of
reducing the regulatory burden associated with the System's application
and notices procedures.
Regulatory Flexibility Act Analysis
Pursuant to section 605(b) of the Regulatory Flexibility Act (5
U.S.C. 601 et seq.), the Board does not believe that these changes will
have a significant adverse economic impact on a substantial number of
small entities. This interim rule will reduce the regulatory burden on
bank holding companies imposed by the Board's procedures, and the Board
is inviting public comment on additional ways to reduce regulatory
burden.
Paperwork Reduction Act Analysis
No collections of information pursuant to section 3504(h) of the
Paperwork Reduction Act (44 U.S.C. 3501 et seq.) are contained in these
changes, and comment is invited on a proposal that would reduce the
current information collection requirements imposed in connection with
certain applications.
List of Subjects in 12 CFR Part 225
Administrative practice and procedure, Banks, Banking, Federal
Reserve System, Holding companies, Reporting and recordkeeping
requirements, Securities.
For the reasons set forth in the preamble, the Board amends 12 CFR
part 225 as follows:
PART 225--BANK HOLDING COMPANIES AND CHANGE IN BANK CONTROL
(REGULATION Y)
1. The authority citation for part 225 continues to read as
follows:
Authority: 12 U.S.C. 1817(j)(13), 1818, 1831i, 1831p-1,
1843(c)(8), 1844(b), 1972(1), 3106, 3108, 3907, 3909, 3310, and
3331-3351.
2. Sections 225.23 and 225.24 are revised to read as follows:
Sec. 225.23 Procedures for notices to engage in nonbanking activities.
(a) Notice required for nonbanking activities. A notice for the
Board's prior approval under Sec. 225.21(a) to engage in or acquire a
company engaged in a nonbanking activity shall be filed by a bank
holding company (including a company seeking to become a bank holding
company) with the appropriate Reserve Bank in accordance with this
section and the Board's Rules of Procedure (12 CFR 262.3).
(1) Engaging de novo in listed activities. A bank holding company
seeking to commence or to engage de novo, either directly or through a
subsidiary, in a nonbanking activity listed in Sec. 225.25 shall file a
notice containing the following:
(i) A description of the activities to be conducted;
(ii) The identity of the company that will conduct the activity;
and
(iii) If the notificant proposes to conduct the activity through an
existing subsidiary, a description of the existing activities of the
subsidiary.
(2) Acquiring company engaged in listed activities. A bank holding
company seeking to acquire or control voting securities or assets of a
company engaged in a nonbanking activity listed in Sec. 225.25 shall
file a notice containing the following:
(i) A description of the proposal, including a description of each
proposed activity, and the effect of the proposal on competition among
entities engaging in each proposed activity;
(ii) The identity of any entity involved in the proposal, and if
the notificant proposes to conduct the activity through an existing
subsidiary, a description of the existing activities of the subsidiary;
(iii) A statement of the public benefits that can reasonably be
expected to result from the proposal; and
(iv) A description of the terms and sources of funds for the
transaction; a copy of any pertinent purchase agreement(s); balance
sheet and income statements for the most recent fiscal quarter and
year-end for any company to be acquired; parent company only and
consolidated pro forma balance sheets for the notificant as of the most
recent fiscal quarter; and calculations of pro forma consolidated risk-
based capital ratios and leverage ratio for the notificant as of the
most recent fiscal quarter.
(3) Engaging in or acquiring company to engage in unlisted
activities. A bank holding company seeking to commence or to engage de
novo, or to acquire or control voting securities or assets of a company
engaged in, any activity not listed in Sec. 225.25 shall file a notice
containing the following:
(i) Evidence that the proposed activity is so closely related to
banking or managing or controlling banks as to be a proper incident
thereto;
(ii) A commitment to comply with all conditions and limitations
that have been established by the Board governing the proposed
activity; and
(iii) The information required in paragraph (a)(2) of this section,
as appropriate.
(b) Notice provided to Board. The Reserve Bank shall immediately
send to the Board a copy of any notice received under paragraphs (a)(2)
or (a)(3) of this section.
(c) Notice to public--(1) Listed activities and activities approved
by order. A Reserve Bank that receives a notice involving an activity
listed in Sec. 225.25 or previously approved by the Board by order
shall immediately send notice of receipt of the proposal to the Board
for publication in the Federal Register. The Federal Register notice
shall invite public comment on the proposal for a period of 15 days.
(2) New activities--(i) In general. In the case of a notice under
this section involving an activity that is not listed in Sec. 225.25
and that has not been previously approved by the Board by order, the
Board shall send notice of the proposal to the Federal Register for
publication, unless the Board determines that the notificant has not
demonstrated that the activity is so closely related to banking or to
managing or controlling banks as to be a proper incident thereto. The
Federal Register notice shall invite public comment on the proposal for
a reasonable period of time, generally for 30 days.
(ii) Time for publication. The Board shall send the notice required
under this paragraph to the Federal Register within 10 business days of
acceptance by the Reserve Bank. The Board may extend the 10-day period
for an additional 30 calendar days upon notice to the notificant. In
the event notice of a proposal is not published for comment, the Board
shall inform the notificant of the reasons for the decision.
(d) Action on notices--(1) Reserve Bank action.--(i) In general.
Within 30 calendar days after receipt by the Reserve Bank of a notice
filed pursuant to paragraphs (a)(1) or (a)(2) of this section, the
Reserve Bank shall:
(A) Approve the notice; or
(B) Refer the notice to the Board for decision because substantive
adverse comment has been received or because action under delegated
authority is not appropriate.
(ii) Return of incomplete notice. Within 15 calendar days of
receipt, the Reserve Bank may return any notice as informationally
incomplete that does not contain all of the information required by
this subpart. The return of such a notice shall be deemed action on the
notice.
(iii) Extension of period for action. The Reserve Bank may, within
the 30-day period provided in this paragraph for action on a notice,
extend such 30-day period for an additional 15 calendar days.
(iv) Notice of action. The Reserve Bank shall promptly notify the
bank holding company of any action, referral or extension under this
paragraph.
(v) Close of public comment period. The Reserve Bank shall not
approve any notice under this paragraph prior to the fifth business day
after the close of the public comment period, unless an emergency
exists that requires expedited or immediate action.
(2) Board action--(i) Internal schedule. The Board seeks to act on
every notice referred to it for decision within 60 days of the date
that the notice is filed with the Reserve Bank. If the Board is unable
to act within this period, the Board will notify the notificant and
explain the reasons and the date by which the Board expects to act.
(ii) Required time limit for Board action. The Board shall act on
any notice under this section that is referred to it for decision
within 60 calendar days after the submission of a complete notice.
(iii) Extension of required period for action--(A) In general. The
Board may extend the 60-day period required for Board action under
paragraph (d)(2)(ii) of this section for an additional 30 days upon
notice to the notificant.
(B) Unlisted activities. If a notice involves a proposal to engage
in an activity that is not listed in Sec. 225.25, the Board may extend
the period required for Board action under paragraph (d)(2)(ii) of this
section for an additional 90 days. This 90-day extension is in addition
to the 30-day extension period provided in paragraph (d)(2)(iii)(A) of
this section. The Board shall notify the notificant that the notice
period has been extended and explain the reasons for the extension.
(3) Requests for additional information. The Board or the Reserve
Bank may at any time request any additional information that either
believes is needed for a decision on any notice under this subpart.
(4) Tolling of period. The Board or the Reserve Bank, as the case
may be, may at any time extend or toll the time period for action on a
notice for any period with the consent of the notificant.
(5) Approval through failure to act. A notice under this subpart
shall be deemed to be approved at the conclusion of the period that
begins on the date the complete notice is received by the Reserve Bank
or the Board and that ends 60 calendar days plus any applicable
extension and tolling period thereafter.
(6) Complete notice. A notice shall be deemed to be complete for
purposes of this subpart at such time as it contains all information
required by this subpart and all other information requested by the
Board or the Reserve Bank in connection with the particular notice.
(e) Expedited procedure for small acquisitions--(1) Filing notice.
As an alternative to the notice procedure of paragraph (a)(2) of this
section, a bank holding company may satisfy the notice requirement of
this section in connection with the acquisition of voting securities or
assets of a company engaged in an activity listed in Sec. 225.25 by:
(i) Providing the appropriate Reserve Bank with a description of
the transaction; and either
(ii) Submitting a copy of a newspaper notice in the form prescribed
by the Board; or
(iii) Requesting the Board to publish notice of the proposal in the
Federal Register as provided in paragraph (c)(1) of this section.
(2) Contents of publication. A newspaper notice under this
subsection shall be published in a newspaper of general circulation in
the areas to be served as a result of the acquisition and shall provide
an opportunity for interested persons to comment on the notice for a
period of at least 10 calendar days.
(3) Criteria for use of expedited procedure. The procedure in this
paragraph is available only if:
(i) Neither the book value of the assets to be acquired nor the
gross consideration to be paid for the securities or assets exceeds the
greater of:
(A) $15 million; or
(B) Five percent of the consolidated assets of the acquiring
company up to a maximum of $300 million;
(ii) The bank holding company has previously received Board
approval to engage in the activity involved in the acquisition; and
(iii) The bank holding company meets the Board's Capital Adequacy
Guidelines (Appendix A of subparts A through E of this part).
(4) Action on notice. Within 5 business days after the close of the
comment period specified in the Federal Register notice or within 15
calendar days after receipt by the Reserve Bank of the newspaper
notice, the Reserve Bank shall either approve the proposal or refer it
to the Board for decision if action under delegated authority is not
appropriate. The Board shall act in accordance with paragraph (d)(2) of
this section on a notice under this paragraph that is referred to it
for decision. The Reserve Bank, upon written notice to the notificant,
may extend the time period for approval under this paragraph for a
reasonable period of time not to exceed 30 days.
(f) Hearings--(1) Procedure to request hearing. Any request for a
hearing on a notice under this section shall comply with the provisions
of 12 CFR 262.3(e).
(2) Determination to hold hearing. The Board may order a formal or
informal hearing or other proceeding on a notice as provided in 12 CFR
262.3(i)(2). The Board shall order a hearing only if there are disputed
issues of material fact that cannot be resolved in some other manner.
(3) Extension of period for hearing. The Board may extend the time
for action on any notice for such time as is reasonably necessary to
conduct a hearing and evaluate the hearing record. Such extension shall
not exceed 91 calendar days after the date of submission to the Board
of the complete record on the notice. The procedures for computation of
the 91-day rule as set forth in Sec. 225.14(g) apply to notices under
this subpart that involve hearings.
(g) Notice to expand or alter nonbanking activities--(1) De novo
expansion. A notice under paragraph (a)(1) of this section is required
to open a new office or to form a subsidiary to engage in, or to
relocate an existing office engaged in, a nonbanking activity that the
Board has previously approved for the bank holding company under this
regulation, only if:
(i) The Board's prior approval was limited geographically;
(ii) The activity is to be conducted in a country outside of the
United States and the bank holding company has not previously received
prior Board approval under this regulation to engage in the activity in
that country; or
(iii) The Board or appropriate Reserve Bank has notified the
company that a notice under paragraph (a)(1) of this section is
required.
(2) Activities outside United States. With respect to activities to
be engaged in outside the United States that require approval under
this subpart, the procedures of this section apply only to activities
to be engaged in directly by a bank holding company that is not a
qualifying foreign banking organization or by a nonbank subsidiary of a
bank holding company approved under this subpart. Regulation K (12 CFR
part 211) governs other international operations of bank holding
companies.
(3) Alteration of nonbanking activity. A notice under paragraph
(a)(1) of this section is required to alter a nonbanking activity in
any material respect from that considered by the Board in acting on the
application or notice to engage in the activity.
(h) Emergency thrift institution acquisitions. In the case of a
notice to acquire a thrift institution, the Board may modify or
dispense with the public notice and hearing requirements of this
section if the Board finds that an emergency exists that requires the
Board to act immediately and the primary Federal regulator of the
institution concurs.
Sec. 225.24 Factors considered in acting on nonbanking proposals.
(a) In general. In evaluating a notice under Sec. 225.23, the Board
shall consider whether the performance by the notificant of the
activities can reasonably be expected to produce benefits to the public
(such as greater convenience, increased competition, and gains in
efficiency) that outweigh possible adverse effects (such as undue
concentration of resources, decreased or unfair competition, conflicts
of interest, and unsound banking practices).
(b) Financial and managerial resources. Consideration of the
factors in paragraph (a) of this section includes an evaluation of the
financial and managerial resources of the notificant, including its
subsidiaries, and any company to be acquired, and the effect of the
proposed transaction on those resources.
(c) Competitive effect of de novo proposals. Unless the record
demonstrates otherwise, the commencement or expansion of a nonbanking
activity de novo is presumed to result in benefits to the public
through increased competition.
(d) Denial for lack of information. The Board may deny any notice
submitted under this subpart if the notificant neglects, fails, or
refuses to furnish all information required by the Board.
By order of the Board of Governors of the Federal Reserve
System, effective October 26, 1994.
William W. Wiles,
Secretary of the Board.
[FR Doc. 94-27057 Filed 11-1-94; 8:45 am]
BILLING CODE 6210-01-P
