Memo #
8038
FEDERAL RESERVE PROPOSAL TO PERMIT BANK HOLDING COMPANY PERSONNEL TO SERVE ON FUND BOARDS
|
Print
July 8, 1996
TO: BOARD OF GOVERNORS No. 38-96
SEC RULES COMMITTEE No. 71-96
RE: FEDERAL RESERVE PROPOSAL TO PERMIT BANK HOLDING COMPANY
PERSONNEL TO SERVE ON FUND BOARDS
______________________________________________________________________________
Section 32 of the Glass-Steagall Act prohibits Federal Reserve Board member banks from
sharing officers, directors or employees with securities firms, including mutual funds. The
Board has interpreted Section 32 also to prohibit bank holding companies from sharing officers,
directors or employees with mutual funds and other securities firms. Therefore, to date the
Board has prohibited bank holding company personnel from serving on mutual fund boards.
The Board proposes to rescind this interpretation. A copy of the Board’s proposal is
attached. If the Board were to rescind its interpretation, then an officer, director, or employee
of a bank holding company (but not the member bank) could serve on the board of a mutual
fund. The comment period on the Boards proposal expires on August 2nd. Please provide the
undersigned with your comments at 202/326-5819.
Thomas M. Selman
Associate Counsel
Attachment