|For immediate release|
The Federal Reserve Board is requesting public comment on a proposal that would amend Regulation H (Membership of State Banking Institutions in the Federal Reserve System) to expand the prohibition against deposit production offices to include any branch of a bank controlled by an out-of-state bank holding company.
Comment is requested by June 8, 2001.
Section 109 of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (Interstate Act) prohibits banks from engaging in interstate branching primarily for the purpose of deposit production. It was intended to ensure that interstate branching authority would not result in the taking of deposits from a community without banks reasonably helping to meet the credit needs of that community.
Section 106 of the Gramm-Leach-Bliley Act of 1999 expanded the coverage of section 109 of the Interstate Act to include any branch of a bank controlled by an out-of-state bank holding company. The Board's proposal amends the regulatory prohibition against branches being used as deposit production offices to include any bank or branch of a bank controlled by an out-of-state bank holding company, including a bank consisting only of a main office.
The proposed amendment to Regulation H is similar to proposed amendments to regulations of the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation.
2001 Banking and consumer regulatory policy