How Does Becoming A Bank Holding Company Help Goldman Sachs And Morgan Stanley?
A bank holding company, under the laws of the United States, is any entity that directly or indirectly owns, controls, or has the power to vote 25% or more of a class of securities of a U.S. bank. Bank holding companies are required to register with the Board of Governors of the Federal Reserve System. Bank holding companies are subject to the Bank Holding Company Act of 1956 (12 U.S.C. ยง 1841(a)(2)(A) et seq.). The Federal Reserve Board of Governors, under Regulation Y (12 C.F.R. Pt. 225) has responsibility for regulating and supervising bank holding company activities, such as establishing capital standards, approving mergers and acquisitions and inspecting the operations of such companies. This authority applies even though a bank owned by a holding company may be under the primary supervision of the Comptroller of the Currency or the Federal Deposit Insurance Corporation. New or smaller banks often re-structure themselves into bank holding companies to take advantage of the greater
