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Fed Exempts Securitization in Rule on Bank Concentration Limits

The Federal Reserve will let banks
continue securitization activities after reaching a new limit
barring them from acquisitions that pull their marketplace share
beyond 10 percent of all financial-company liabilities.

The Fed’s final order on bank thoroughness boundary is
“substantially similar” to a offer expelled in May, the
central bank pronounced in a matter today. If a financial company
reaches a 10 percent threshold set by a Dodd-Frank Act it
can’t acquire another association underneath businessman banking authority,
the Fed said.

The order implements a Dodd-Frank charge that matches a 10
percent top that already relates to deposits. The extent is
intended to foster financial fortitude and fight perceptions
that some U.S. banks would have to be bailed out in a crisis.

The Financial Stability Oversight Council, a row of U.S.
regulators, pronounced in a 2011 news that a boundary will reduce
the risks “created by increasing thoroughness outset from
mergers, consolidations or acquisitions.”

To hit a reporters on this story:
Ian Katz in Washington at
[email protected];
Jesse Hamilton in Washington at
[email protected]

To hit a editors obliged for this story:
Gregory Mott at
[email protected];
Chris Wellisz at
[email protected]
Sara Forden

Article source: http://www.bloomberg.com/news/2014-11-05/fed-exempts-securitization-in-rule-on-bank-concentration-limits.html

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