Federal Agencies Seek Additional Limits On Permissible Banking Activities

The Board of Governors of the Federal Reserve System (the "FRB"), the FDIC and the Office of the Comptroller of the Currency ("OCC") (collectively, the "Agencies") conducted a study of the kinds of activities and investments that are permissible for banking entities, the associated risks of the activities, and how the risks are mitigated by those entities. The joint Report, mandated by Dodd-Frank Act, Section 620, was prepared for the Financial Services Committee, the U.S. Senate Committee on Banking, Housing and Urban Affairs, and the Financial Stability Oversight Council ("FSOC").

The FRB prepared the first section, which covers state member banks, depository institution holding companies, the Edge Act and agreement corporations, and the U.S. operations of foreign banking organizations. The FRB recommended, among other things, that Congress repeal: