[Federal Register Volume 64, Number 236 (Thursday, December 9, 1999)]
[Notices]
[Pages 69071-69072]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-31960]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
[Docket No. 99-18]
Operating Subsidiary Notice
AGENCY: Office of the Comptroller of the Currency, Treasury.
ACTION: Notice and request for public comment on an operating
subsidiary application.
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SUMMARY: The Office of the Comptroller of the Currency (OCC) requests
public comment concerning an application filed by First Tennessee Bank,
N.A., Memphis, Tennessee (First Tennessee Bank) to expand the
activities of its operating subsidiary, First Tennessee Securities
Corporation (FTSC), to underwrite and deal in, to a limited extent, all
types of debt and equity securities (other than ownership interests in
open-end investment companies).
DATES: Comments should be submitted by January 10, 2000.
ADDRESSES: Written comments regarding the application should be
submitted to the Office of the Comptroller of the Currency,
Communications Division, Docket No. 99-18, 250 E Street, SW,
Washington, DC 20219. In addition, comments may be sent by facsimile
transmission to fax number (202) 874-5274 or by internet mail to
[email protected]. A copy of the application and comments
received will be available for inspection and copying at the OCC's
Public Reference Room, 250 E Street, SW, Washington, DC 20219.
Appointments to inspect the application and review any comments
received can be made by calling (202) 874-5043.
FOR FURTHER INFORMATION CONTACT: Beth Kirby, Senior Attorney,
Securities and Corporate Practices Division, (202) 874-5210, or Stephen
Lybarger, NBE--
[[Page 69072]]
Licensing Expert, Bank Organization and Structure, (202) 874-5060.
SUPPLEMENTARY INFORMATION: First Tennessee Bank has applied to the OCC,
pursuant to 12 CFR 5.34(f), to expand the activities of its operating
subsidiary, FTSC, to underwrite and deal in, on a limited basis, all
types of debt and equity securities (other than ownership interests in
open-end investment companies).
FTSC currently is authorized to underwrite and deal in, to a
limited extent, municipal revenue bonds and to engage in certain bank
permissible activities, including the following:
(1) Arranging commercial mortgage loans for First Tennessee Bank
and outside customers, including long-term, fixed rate commercial real
estate loans extended by life insurance companies and securitizing such
loans;
(2) Engaging in private placements of corporate debt securities,
trust preferred securities, and leases, including structuring,
documenting, and placing fixed rate secured and unsecured term debt,
fixed rate subordinated debt, and fixed rate mezzanine debt for
commercial customers, as well as engaging in large lease transactions
and loan syndications and participations;
(3) Providing advisory services in connection with mergers and
acquisitions activities, including valuations, acquisitions, and sales
such as the acquisition or marketing of branches for financial
institutions;
(4) Buying and selling all types of securities on an agency or
``riskless principal'' basis;
(5) Engaging as principal in investing and trading activities in
bank eligible securities;
(6) Advising, structuring, arranging and executing transactions, as
agent or principal, with respect to derivative instruments;
(7) Underwriting, dealing, trading, investing and public finance
activities in bank eligible securities, including securities of states
and political subdivisions thereof which meet the definition of general
obligation securities as defined by the OCC; and
(8) Securitizing and selling pools of consumer-receivable loans,
including credit card loans, auto loans, home equity lines of credit,
and 1-4 family residential mortgages, and buying and selling
securitized assets.
Decision of the Comptroller of the Currency on the Application of
First Tennessee Bank, N.A., Memphis, TN To Establish an Operating
Subsidiary (April 12, 1999), OCC Conditional Approval No. 309,
Interpretations and Actions, May 1999, Vol. 12, No. 5 (``First
Tennessee Decision'')
Under 12 CFR 5.34(f), the OCC may permit a national bank to conduct
an activity through its operating subsidiary that is different from
that permissible for the parent national bank, subject to the
additional requirements specified in 12 CFR 5.34(f), if the OCC
concludes that the activity is part of or incidental to the business of
banking or is permitted under other statutory authority.
In considering the proposed activity, the OCC will consider the
particular activity at issue and will weigh:
(1) The form and specificity of the restriction applicable to the
parent bank;
(2) Why the restriction applies to the parent bank; and
(3) Whether it would frustrate the purpose underlying the
restriction on the parent bank to permit a subsidiary of the bank to
engage in the particular activity.
The OCC's evaluation of these factors will also take into account
the safety and soundness implications of the activity for the operating
subsidiary and the parent national bank, the regulatory safeguards that
apply to the operating subsidiary and to the activity itself, any
conditions that may be imposed in conjunction with an application
approval, and any additional undertakings by the bank or the operating
subsidiary that address the foregoing factors.
For activities not previously approved by the OCC, the OCC provides
public notice and opportunity for comment on the application by
publishing notice of the application in the Federal Register. In
publishing notice of the application, the OCC does not take a position
on issues raised by the proposal. Notice is published solely to seek
the views of interested persons on the issues presented and does not
represent a determination by the OCC that the proposal meets, or is
likely to meet, the criteria outlined above. Interested parties are
invited to comment on any aspect of the application.1
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\1\ The OCC notes that the Bank's proposal will be permissible
under the standards of the recently enacted Gramm-Leach-Bliley Act
(``G-L-B Act''). The Bank meets (and where applicable, all its
insured depository institution affiliates meet) the standards set
forth in section 121 of the G-L-B Act for a national bank to have a
``financial subsidiary'' engaged in the types of activities that
include those proposed by the Bank. Section 121 of the Act will
become effective March 11, 2000.
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Dated: November 17, 1999.
John D. Hawke, Jr.,
Comptroller of the Currency.
[FR Doc. 99-31960 Filed 12-8-99; 8:45 am]
BILLING CODE 4810-33-P