[Federal Register Volume 59, Number 48 (Friday, March 11, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-5693]
[[Page Unknown]]
[Federal Register: March 11, 1994]
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FEDERAL RESERVE SYSTEM
The Toronto-Dominion Bank; Application to Engage in Certain
Nonbanking Activities
The Toronto-Dominion Bank, Toronto, Canada (Applicant), has applied
pursuant to section 4(c)(8) of the Bank Holding Company Act (12 U.S.C.
1843(c)(8)) (BHC Act) and section 225.23 of the Board's Regulation Y
(12 CFR 225.23), to engage de novo through its indirect wholly owned
subsidiary, Toronto-Dominion Securities (USA) Inc., New York, New York
(Company), in the following nonbanking activities:
1. Underwriting and dealing in, to a limited extent, all types of
debt and equity securities, including sovereign debt securities,
corporate debt securities, debt securities convertible into equity
securities, debt securities issued by a trust or other vehicle secured
by or representing interests in debt obligations, preferred stock,
common stock, American Depositary Receipts, and other direct and
indirect ownership interests in corporations and other entities;
2. Purchasing and selling all types of securities as a ``riskless
principal'' on the order of customers; and
3. Making, acquiring, and servicing loans or other extensions of
credit (including issuing letters of credit and accepting drafts) for
Company's account or for the account of others, pursuant to section
225.25(b)(1) of Regulation Y.
Applicant seeks approval for Company to conduct the proposed
activities throughout the United States.
Closely Related to Banking Standard
Section 4(c)(8) of the BHC Act provides that a bank holding company
may, with Board approval, engage in any activity ``which the Board
after due notice and opportunity for hearing has determined (by order
or regulation) to be so closely related to banking or managing or
controlling banks as to be a proper incident thereto.'' In determining
whether a proposed activity is closely related to banking for purposes
of the BHC Act, the Board considers, inter alia, the matters set forth
in National Courier Association v. Board of Governors of the Federal
Reserve System, 516 F.2d 1229 (D.C. Cir. 1975). These considerations
are:
(1) Whether banks generally have in fact provided the proposed
services;
(2) Whether 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 services; and
(3) Whether banks generally provide services that are so integrally
related to the proposed services as to require their provision in a
specialized form. See 516 F.2d at 1237. In addition, the Board may
consider any other basis that may demonstrate that the activity has a
reasonable or close relationship to banking or managing or controlling
banks. Board Statement Regarding Regulation Y, 49 FR 806 (1984).
Applicant states that the Board previously has determined by
regulation that the proposed lending activities, when conducted within
the limitations established by the Board in its regulations and in
related interpretations and orders, are closely related to banking for
purposes of section 4(c)(8) of the BHC Act. See 12 CFR 225.25(b)(1).
Applicant also maintains that the Board previously has determined
by order that the other proposed activities, when conducted within the
limitations established by the Board in its previous orders, are
closely related to banking, and consistent with section 20 of the
Glass-Steagall Act (12 U.S.C. 377). See Canadian Imperial Bank of
Commerce, et al., 76 Federal Reserve Bulletin 158 (1990); J.P. Morgan &
Co. Incorporated, et al., 75 Federal Reserve Bulletin 192 (1989), aff'd
sub nom. Securities Industries Ass'n v. Board of Governors of the
Federal Reserve System, 900 F.2d 360 (D.C. Cir. 1990); Order Approving
Modifications to the Section 20 Orders, 75 Federal Reserve Bulletin 751
(1989); Order Approving Modifications to the Section 20 Orders, 79
Federal Reserve Bulletin 226 (1993); and Supplement to Order Approving
Modifications to Section 20 Orders, 79 Federal Reserve Bulletin 360
(1993) (underwriting and dealing activities). See also Dauphin Deposit
Corporation, 77 Federal Reserve Bulletin 672 (1991); Bankers Trust New
York Corporation, 75 Federal Reserve Bulletin 829 (1989) (riskless
principal activities).
Applicant maintains that Company will conduct the proposed
activities in conformity with the conditions and limitations
established by the Board in prior cases.
Proper Incident to Banking Standard
In order to approve the proposal, the Board must determine that the
proposed activities to be conducted by Company ``can reasonably be
expected to produce benefits to the public, such as greater
convenience, increased competition, or gains in efficiency, that
outweigh possible adverse effects, such as undue concentration of
resources, decreased or unfair competition, conflicts of interests, or
unsound banking practices.'' 12 U.S.C. 1843(c)(8).
Applicant believes that the proposal will produce public benefits
that outweigh any potential adverse effects. In particular, Applicant
maintains that the proposal will enhance competition and provide
greater convenience to Company's customers. In addition, Applicant
states that the proposed activities will not result in adverse effects
such as an undue concentration of resources, decreased or unfair
competition, conflicts of interest, or unsound banking practices.
In publishing the proposal for comment, the Board does not take a
position on issues raised by the proposal. Notice of the proposal is
published solely in order to seek the views of interested persons on
the issues presented by the application, and does not represent a
determination by the Board that the proposal meets or is likely to meet
the standards of the BHC Act.
Any comments or requests for hearing should be submitted in writing
and received by William W. Wiles, Secretary, Board of Governors of the
Federal Reserve System, Washington, D.C. 20551, not later than April 9,
1994. Any request for a hearing on this application must, as required
by Sec. 262.3(e) of the Board's Rules of Procedure (12 CFR 262.3(e)),
be accompanied by a statement of the reasons why a written presentation
would not suffice in lieu of a hearing, identifying specifically any
questions of fact that are in dispute, summarizing the evidence that
would be presented at a hearing, and indicating how the party
commenting would be aggrieved by approval of the proposal. This
application may be inspected at the offices of the Board of Governors
or the Federal Reserve Bank of New York.
Board of Governors of the Federal Reserve System, March 4, 1994.
Jennifer J. Johnson,
Associate Secretary of the Board.
[FR Doc. 94-5693 Filed 3-10-94; 8:45 am]
BILLING CODE 6210-01-F