Legal Interpretations
Bank Holding Company/Change in Control - 2000 Letters
August 16, 2000
To Ronald Mayer, regarding the proposal by The Chase Manhattan Bank (CMB) to acquire indirectly less than 100 percent, but more than 50 percent, of the voting shares of a company (Company) that would engage in activities permissible for CMB under New York state and Federal law. Company would not engage in any activity that may only be conducted in a financial subsidiary of a bank, as that term is defined in the Gramm-Leach-Bliley Act (GLB Act). The letter indicates the Board's view that as a result of the GLB Act, a state member bank may acquire shares of a company that (1) on consummation of the acquisition would be a subsidiary of the bank within the meaning of the Bank Holding Company Act (BHC Act), and (2) engages only in activities in which the parent bank may engage, at locations at which the bank may engage in the activities, and subject to the same limitations as if the bank were engaging in the activities directly. In addition, it would be consistent with the requirements of the BHC Act and the Board's Regulation Y for CMB's parent financial holding company to notify the Board within 30 days after it has acquired an interest in Company through CMB, in accordance with section 225.87(a) of Regulation Y.
August 1, 2000
Letter stating that Board staff would not recommend that the Board initiate a control proceeding under the Bank Holding Company Act and Regulation Y if a company continues with a community development initiative in which the company makes investments in, and establishes certain business relationships with, minority-owned and women-owned banks.
June 2, 2000
To Ira Tannenbaum, regarding the proposed credit card operations of FPC Financial, f.s.b. (FPC), a federal savings bank proposed to be formed by Deere & Company (Deere). Credit cards issued by FPC could be used to purchase, among other items, products manufactured by Deere. Occasionally, discounts may be offered in connection with the use of FPC credit cards to purchase Deere products. The letter states the opinion that if the proposed credit card activities of FPC were conducted by a bank, the Board would grant an exception to clarify that the anti-tying restrictions of section 106 of the Bank Holding Company Act Amendments of 1970 (12 U.S.C. § 1972) would not apply to those activities.