Federal Reserve Finalizes Revised Control Framework: Initial Reactions
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- Yesterday, the Federal Reserve Board (“FRB”) adopted a new, comprehensive framework for determining “control” under the Bank Holding Company Act (“BHC Act”) and Home Owners’ Loan Act (“HOLA”).
- The final rule is intended to simplify and clarify the FRB’s standards for determining whether a company exercises a controlling influence over the management or policies of another company and, therefore, “controls” the other company under the BHC Act or HOLA.
- The final rule largely retains the proposal’s tiered framework of control presumptions, but makes certain targeted changes. This analysis provides our high-level takeaways on the final rule. We plan to publish a comprehensive summary of the final rule in the future.