The FRB has sought views on how to begin the process of establishing securities holding companies (SHCs). These are new entities authorized by the Dodd-Frank Act that may be owned by certain nonbanking companies that control at least one registered securities broker-dealer that are also subjected by foreign law to comprehensive consolidated supervision. The NPR details how SHCs would register with the Board and be subject to FRB supervision. The proposed rule also outlines the requirements that firms must satisfy to become an SHC. Although the Dodd-Frank Act and, thus, the NPR, make the SHC a narrower charter than advocates had sought, it still provides strategic options that, given the scope of rules now applicable to bank holding companies, may warrant review by qualifying firms.
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