Confronted with negative press coverage and Congressional hearings on the physical-commodity activities of large financial holding companies (FHCs), the FRB has sought views on what it might due to address risks in this high-profile arena. Trading in this sector would not be directly affected, but “complementary,” merchant banking, and grandfathered transport, operational, warehousing, and other commodity activities could be subjected to higher capital, stricter limits, or other constraints up to and including a flat prohibition were the FRB to decide that comments warrant action.
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