1018 Federal Register / Vol. 66, No. 4 / Friday, January 5, 2001 / Rules and Regulations
prior to implementation would have
been unnecessary and contrary to the
public interest. A portion of this rule
expands the categories of persons who
may transit the United States without a
visa and is thus considered beneficial to
both the traveling public and the United
States Government. Moreover, this
aspect of the rule grants or recognizes an
exemption or relieves a restriction
within the scope of the exception set
forth at 5 U.S.C. 553(d)(1). Certain other
countries have been added to the
countries ineligible to transit without a
visa. The reason for the necessity for
implementation of this aspect of the
interim rule is as follows: It is necessary
to prevent an anticipated sharp increase
in the abuse of the TWOV program by
citizens of the countries placed on the
list of ineligible TWOV countries. These
countries are placed on the ineligible to
TWOV list for a variety of reasons
including past abuse of the transit
without visa privilege; the country’s
nonimmigrant visa refusal rate; whether
the country grants United States citizens
reciprocal treatment; the country’s
crime rate; the stability of the country;
any security concerns; and, whether the
country has diplomatic relations with
the United States, among other reasons.
Regulatory Flexibility Act
The Commissioner of the Immigration
and Naturalization Service, in
accordance with the Regulatory
Flexibility Act (5 U.S.C. 605(b)), has
reviewed this regulation and by
approving it certifies that this rule will
not have a significant economic impact
on a substantial number of small
entities. This rule governs whether a
citizen of a particular country may
transit the United States under the
TWOV program. These aliens are not
considered small entities as that term is
defined under 5 U.S.C. 601(6).
Unfunded Mandates Reform Act of
1995
This rule will not result in the
expenditure by State, local, and tribal
governments in the aggregate, or by the
private sector, of $100 million or more
in any 1-year, and it will not
significantly or uniquely affect small
governments. Therefore, no actions were
deemed necessary under the provisions
of the Unfunded Mandates Reform Act
of 1995.
Small business Regulatory Enforcement
Fairness Act of 1996
This rule is not a major rule as
defined by section 804 of the Small
Business Regulatory Enforcement Act of
1996. This rule will not result in an
annual effect on the economy of $100
million or more; a major increase in cost
or prices; or significant adverse effects
on competition, employment,
investment, productivity, innovation, or
on the ability of United States-based
companies to compete with foreign-
based companies in domestic and
export markets.
Executive Order 12866
This rule is not considered by the
Department of Justice, Immigration and
Naturalization Service, to be a
‘‘significant regulatory actions’’ under
Executive Order 12866, section 3(f),
Regulatory Planning and Review.
Accordingly, the Office of Management
and Budget has waived its review
process under section 6(a)(3)(A).
Executive Order 13132
This rule will not have substantial
direct effects on the States, on the
relationship between the Government
and the States, or on the distribution of
power and responsibilities among the
various levels of government. Therefore,
in accordance with section 6 of
Executive Order 13132, it is determined
that this rule does not have sufficient
federalism implications to warrant the
preparation of a federalism summary
impact statement.
Executive Order 12988 Civil Justice
Reform
This final rule meets the applicable
standards set forth in sections 3(a) and
3(b)(2) of Executive Order 12988.
List of Subjects in 8 CFR Part 212
Administrative practice and
procedure, Aliens, Passports and Visas.
Accordingly, part 212 of chapter I of
title 8 of the Code of Federal
Regulations is amended as follows:
PART 212—DOCUMENTARY
REQUIREMENTS: NONIMMIGRANTS;
WAIVERS; ADMISSION OF CERTAIN
INADMISSIBLE ALIENS; PAROLE
1. The authority citation for part 212
continues to read as follows:
Authority: 8 U.S.C. 1101, 1102, 1103, 1182,
1184, 1187, 1225, 1226, 1227, 1228, 1252; 8
CFR part 2.
2. Section 212.1 is amended by:
a. Removing paragraph (f)(2);
b. Redesignating paragraphs (f)(3) and
(f)(4) as paragraphs (f)(2) and (f)(3)
respectively; and by
c. Revising newly redesignated
paragraph (f)(2), to read as follows:
§ 212.1 Documentary requirements for
nonimmigrants.
* * * * *
(f) * * *
(2) Unavailability to transit. This
waiver of passport and visa requirement
is not available to an alien who is a
citizen of Afghanistan, Angola,
Bangladesh, Belarus, Bosnia-
Herzegovina, Burma, Burundi, Central
African Republic, People’s Republic of
China, Congo (Brazzaville), Cuba, India,
Iran, Iraq, Libya, Nigeria, North Korea,
Pakistan, Russia, Serbia, Seirra Leone,
Somalia, Sri Lanka, and Sudan.
* * * * *
Dated: December 21, 2000.
Mary Ann Wyrsch,
Acting Commissioner, Immigration and
Naturalization Service.
[FR Doc. 01–354 Filed 1–4–01; 8:45 am]
BILLING CODE 4410–10–M
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Parts 303, 337, and 362
RIN 3064–AC38
Activities and Investments of Insured
State Banks
AGENCY: Federal Deposit Insurance
Corporation (FDIC).
ACTION: Final rule and confirmation of
interim final rule with changes.
SUMMARY: The FDIC is adopting a final
rule to implement certain provisions of
the Gramm-Leach-Bliley Act (G–L–B
Act), governing activities and
investments of insured state banks.
Under the final rule, the FDIC adopts a
streamlined certification process for
insured state nonmember banks to
follow before they may conduct
activities as principal through a
financial subsidiary. State nonmember
banks will self-certify that they meet the
requirements to carry out these
activities, which will allow the banks to
conduct the new activities immediately.
There will be no delay for
administrative approval or review,
although the FDIC will evaluate these
activities as part of its normal
supervision process for safety and
soundness standards pursuant to the
FDIC’s authority under section 8 of the
Federal Deposit Insurance Act (FDI Act).
The final rule confirms, with
modifications, an interim rule that has
been in effect since March 11, 2000. To
eliminate unnecessary provisions and
make technical amendments, the FDIC
also has revised its rule implementing
sections 24 and 18(m) of the FDI Act
dealing with other activities and
investments of insured state banks.
EFFECTIVE DATE: January 5, 2001.
VerDate 11<MAY>2000 16:40 Jan 04, 2001 Jkt 194001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\05JAR1.SGM pfrm10 PsN: 05JAR1
prior to implementation would have
been unnecessary and contrary to the
public interest. A portion of this rule
expands the categories of persons who
may transit the United States without a
visa and is thus considered beneficial to
both the traveling public and the United
States Government. Moreover, this
aspect of the rule grants or recognizes an
exemption or relieves a restriction
within the scope of the exception set
forth at 5 U.S.C. 553(d)(1). Certain other
countries have been added to the
countries ineligible to transit without a
visa. The reason for the necessity for
implementation of this aspect of the
interim rule is as follows: It is necessary
to prevent an anticipated sharp increase
in the abuse of the TWOV program by
citizens of the countries placed on the
list of ineligible TWOV countries. These
countries are placed on the ineligible to
TWOV list for a variety of reasons
including past abuse of the transit
without visa privilege; the country’s
nonimmigrant visa refusal rate; whether
the country grants United States citizens
reciprocal treatment; the country’s
crime rate; the stability of the country;
any security concerns; and, whether the
country has diplomatic relations with
the United States, among other reasons.
Regulatory Flexibility Act
The Commissioner of the Immigration
and Naturalization Service, in
accordance with the Regulatory
Flexibility Act (5 U.S.C. 605(b)), has
reviewed this regulation and by
approving it certifies that this rule will
not have a significant economic impact
on a substantial number of small
entities. This rule governs whether a
citizen of a particular country may
transit the United States under the
TWOV program. These aliens are not
considered small entities as that term is
defined under 5 U.S.C. 601(6).
Unfunded Mandates Reform Act of
1995
This rule will not result in the
expenditure by State, local, and tribal
governments in the aggregate, or by the
private sector, of $100 million or more
in any 1-year, and it will not
significantly or uniquely affect small
governments. Therefore, no actions were
deemed necessary under the provisions
of the Unfunded Mandates Reform Act
of 1995.
Small business Regulatory Enforcement
Fairness Act of 1996
This rule is not a major rule as
defined by section 804 of the Small
Business Regulatory Enforcement Act of
1996. This rule will not result in an
annual effect on the economy of $100
million or more; a major increase in cost
or prices; or significant adverse effects
on competition, employment,
investment, productivity, innovation, or
on the ability of United States-based
companies to compete with foreign-
based companies in domestic and
export markets.
Executive Order 12866
This rule is not considered by the
Department of Justice, Immigration and
Naturalization Service, to be a
‘‘significant regulatory actions’’ under
Executive Order 12866, section 3(f),
Regulatory Planning and Review.
Accordingly, the Office of Management
and Budget has waived its review
process under section 6(a)(3)(A).
Executive Order 13132
This rule will not have substantial
direct effects on the States, on the
relationship between the Government
and the States, or on the distribution of
power and responsibilities among the
various levels of government. Therefore,
in accordance with section 6 of
Executive Order 13132, it is determined
that this rule does not have sufficient
federalism implications to warrant the
preparation of a federalism summary
impact statement.
Executive Order 12988 Civil Justice
Reform
This final rule meets the applicable
standards set forth in sections 3(a) and
3(b)(2) of Executive Order 12988.
List of Subjects in 8 CFR Part 212
Administrative practice and
procedure, Aliens, Passports and Visas.
Accordingly, part 212 of chapter I of
title 8 of the Code of Federal
Regulations is amended as follows:
PART 212—DOCUMENTARY
REQUIREMENTS: NONIMMIGRANTS;
WAIVERS; ADMISSION OF CERTAIN
INADMISSIBLE ALIENS; PAROLE
1. The authority citation for part 212
continues to read as follows:
Authority: 8 U.S.C. 1101, 1102, 1103, 1182,
1184, 1187, 1225, 1226, 1227, 1228, 1252; 8
CFR part 2.
2. Section 212.1 is amended by:
a. Removing paragraph (f)(2);
b. Redesignating paragraphs (f)(3) and
(f)(4) as paragraphs (f)(2) and (f)(3)
respectively; and by
c. Revising newly redesignated
paragraph (f)(2), to read as follows:
§ 212.1 Documentary requirements for
nonimmigrants.
* * * * *
(f) * * *
(2) Unavailability to transit. This
waiver of passport and visa requirement
is not available to an alien who is a
citizen of Afghanistan, Angola,
Bangladesh, Belarus, Bosnia-
Herzegovina, Burma, Burundi, Central
African Republic, People’s Republic of
China, Congo (Brazzaville), Cuba, India,
Iran, Iraq, Libya, Nigeria, North Korea,
Pakistan, Russia, Serbia, Seirra Leone,
Somalia, Sri Lanka, and Sudan.
* * * * *
Dated: December 21, 2000.
Mary Ann Wyrsch,
Acting Commissioner, Immigration and
Naturalization Service.
[FR Doc. 01–354 Filed 1–4–01; 8:45 am]
BILLING CODE 4410–10–M
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Parts 303, 337, and 362
RIN 3064–AC38
Activities and Investments of Insured
State Banks
AGENCY: Federal Deposit Insurance
Corporation (FDIC).
ACTION: Final rule and confirmation of
interim final rule with changes.
SUMMARY: The FDIC is adopting a final
rule to implement certain provisions of
the Gramm-Leach-Bliley Act (G–L–B
Act), governing activities and
investments of insured state banks.
Under the final rule, the FDIC adopts a
streamlined certification process for
insured state nonmember banks to
follow before they may conduct
activities as principal through a
financial subsidiary. State nonmember
banks will self-certify that they meet the
requirements to carry out these
activities, which will allow the banks to
conduct the new activities immediately.
There will be no delay for
administrative approval or review,
although the FDIC will evaluate these
activities as part of its normal
supervision process for safety and
soundness standards pursuant to the
FDIC’s authority under section 8 of the
Federal Deposit Insurance Act (FDI Act).
The final rule confirms, with
modifications, an interim rule that has
been in effect since March 11, 2000. To
eliminate unnecessary provisions and
make technical amendments, the FDIC
also has revised its rule implementing
sections 24 and 18(m) of the FDI Act
dealing with other activities and
investments of insured state banks.
EFFECTIVE DATE: January 5, 2001.
VerDate 11<MAY>2000 16:40 Jan 04, 2001 Jkt 194001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\05JAR1.SGM pfrm10 PsN: 05JAR1
1019Federal Register / Vol. 66, No. 4 / Friday, January 5, 2001 / Rules and Regulations
1 12 U.S.C. 1831w(d)(1).
2 12 U.S.C. 1831w(b).
FOR FURTHER INFORMATION CONTACT:
Curtis Vaughn, Examination Specialist
((202) 898–6759), Division of
Supervision; Linda L. Stamp, Counsel
((202) 898–7310), Legal Division, FDIC,
550 17th Street, NW., Washington, DC
20429.
SUPPLEMENTARY INFORMATION:
I. Background
On March 23, 2000, the FDIC
published an interim final rule with
request for comment (65 FR 15526) to
implement certain provisions of the G–
L–B Act (Pub. L. 106–102), which
President Clinton signed into law on
November 12, 1999. Section 121(d) of
the G–L–B Act amended the FDI Act (12
U.S.C. 1811 et seq.) by adding a new
section 46 (12 U.S.C. 1831w). New
section 46(a) of the FDI Act provides
that an insured state bank may control
or hold an interest in a subsidiary that
engages as principal in activities that
would be permissible for a national
bank to conduct only through a
‘‘financial subsidiary,’’ subject to certain
conditions. Because section 46(a)
applies only to ‘‘as principal’’ activities,
state nonmember banks may engage in
agency activities without considering
the requirements of this rule or section.
As set forth in the interim final rule,
section 121(a) of the G–L–B Act permits
national banks to control or hold an
interest in a financial subsidiary, which
is a new type of subsidiary governed by
new section 5136A of the Revised
Statutes. A financial subsidiary may
engage in specified newly authorized
activities that are financial in nature and
activities that are incidental to financial
activities, if the bank and the subsidiary
meet certain requirements and comply
with stated safeguards. A financial
subsidiary also may combine these
financial subsidiary activities with
activities that are permissible for
national banks to engage in directly. The
financial subsidiary activities include
many of the activities which are
authorized for the new ‘‘financial
holding companies’’ as laid out in new
section 4(k) of the Bank Holding
Company Act (BHCA) (12 U.S.C. 1841 et
seq.) as created by section 103(a) of the
G–L–B Act. In the future, the Secretary
of the Treasury (Treasury) and the Board
of Governors of the Federal Reserve
System (FRB) may determine that
additional activities are financial in
nature and therefore authorized for a
financial subsidiary of a national bank.
Section 121(d) of the G–L–B Act,
which creates new section 46 of the FDI
Act, permits state banks to control or
hold an interest in a financial subsidiary
that engages in activities as principal.
To qualify, a state bank must comply
with four statutory conditions and a
mandatory Community Reinvestment
Act (CRA) (12 U.S.C. 2901 et seq.)
requirement found in section 103(a) of
the G–L–B Act, which added a new
subsection (4)(l)(2) to the BHCA (12
U.S.C. 1843(l)(2)).
The FDIC has a long history of
reviewing applications from state banks
to engage in activities not permissible
for national banks under section 24 of
the FDI Act (12 U.S.C. 1831a) as
implemented through part 362 of the
FDIC’s rules and regulations. As stated
in the preamble to the interim final rule,
certain activities which the FDIC
previously addressed under section 24
and subpart A of part 362, such as
general securities underwriting, are now
authorized for a financial subsidiary of
a national bank. As a result, the FDIC
will now analyze the commencement of
such activities under section 46(a)
rather than section 24, and the FDIC
will apply the restrictions contained in
subpart E rather than those in subpart A
of part 362. These statutory changes
necessitate that the FDIC conform its
regulation by limiting the sections
pertaining to such activities from
subpart A to existing subsidiaries.
Other activities conducted as
principal, such as real estate
development or investment, which are
prohibited to national bank financial
subsidiaries, are outside the scope of
section 46(a). These activities will
continue to be governed by section 24
and subpart A of part 362. State banks
that wish to engage in activities
prohibited to national banks may
continue to seek the FDIC’s consent by
filing a notice or application. Should the
Treasury and FRB in the future
determine that additional activities are
authorized for a financial subsidiary of
a national bank, state nonmember banks
commencing such activities for the first
time after such determinations will have
to proceed under section 46(a).
However, banks that obtained FDIC
consent under section 24, whether by
notice, order, or regulation before such
determination may continue to engage
in any such activity pursuant to the
requirements imposed under section 24.
II. Comments Received
The FDIC received 15 comments in
response to the interim final rule. The
comments came from four trade
associations, four state banking
departments, two community-based
associations, a law firm, a state
regulators association, a bank holding
company, and four United States
Senators. Three commenters expressed
support for the FDIC’s interim final rule.
The other commenters expressed
various objections to the rule. Several of
the commenters recommended specific
changes to the interim final rule. A
discussion of these comments and the
changes and additions made to the
interim final rule and the rule
implementing sections 24 and 18(m) of
the FDI Act are discussed in the section
by section analysis. The final rule
adopts a more streamlined process than
the interim rule. A summary of the
comments follows.
The FDIC’s interim rule to implement
section 46 of the G–L–B Act provided
that section 46 is the exclusive method
for an insured state nonmember bank to
engage in ‘‘financial subsidiary
activities.’’ Six of the comments,
including a comment from three United
States Senators, argued that Congress
intended to preserve the FDIC’s
authority to approve activities under
section 24. These commenters argued
that the preservation of authority
provision 1 was meant to ensure that the
FDIC’s authority to approve activities
under section 24 is not diminished by
section 46, and that section 46 was
intended to permit (but not require)
state banks to use the financial
subsidiary vehicle to conduct financial
or incidental activities. On the other
hand, another United States Senator
argued that the interim final rule was
consistent with the statutory language
and legislative history of the G–L–B Act
and that the interim final rule correctly
applies the G–L–B Act to require state
banks to use the financial subsidiary
vehicle to conduct financial or
incidental activities.
Four commenters argued that if
section 46 was read as the only method
under which a state nonmember bank
could engage in financial subsidiary
activities, then innovation in the state
bank system would be stifled and the
dual banking system would be
undermined. Some commenters argued
that Congress’ purpose behind section
46 was to assure state banks that they
would not be disadvantaged if national
banks are authorized to engage in
activities through financial subsidiaries
that the FDIC concludes would not be
permitted to state banks under section
24. The four commenters also noted that
although certain activities which were
previously addressed by the FDIC under
section 24 are now authorized for a
national bank financial subsidiary, the
grandfather provisions of the G–L–B
Act 2 make it clear that any activities
lawfully conducted prior to the G–L–B
Act through a subsidiary under section
VerDate 11<MAY>2000 16:40 Jan 04, 2001 Jkt 194001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 E:\FR\FM\05JAR1.SGM pfrm10 PsN: 05JAR1
1 12 U.S.C. 1831w(d)(1).
2 12 U.S.C. 1831w(b).
FOR FURTHER INFORMATION CONTACT:
Curtis Vaughn, Examination Specialist
((202) 898–6759), Division of
Supervision; Linda L. Stamp, Counsel
((202) 898–7310), Legal Division, FDIC,
550 17th Street, NW., Washington, DC
20429.
SUPPLEMENTARY INFORMATION:
I. Background
On March 23, 2000, the FDIC
published an interim final rule with
request for comment (65 FR 15526) to
implement certain provisions of the G–
L–B Act (Pub. L. 106–102), which
President Clinton signed into law on
November 12, 1999. Section 121(d) of
the G–L–B Act amended the FDI Act (12
U.S.C. 1811 et seq.) by adding a new
section 46 (12 U.S.C. 1831w). New
section 46(a) of the FDI Act provides
that an insured state bank may control
or hold an interest in a subsidiary that
engages as principal in activities that
would be permissible for a national
bank to conduct only through a
‘‘financial subsidiary,’’ subject to certain
conditions. Because section 46(a)
applies only to ‘‘as principal’’ activities,
state nonmember banks may engage in
agency activities without considering
the requirements of this rule or section.
As set forth in the interim final rule,
section 121(a) of the G–L–B Act permits
national banks to control or hold an
interest in a financial subsidiary, which
is a new type of subsidiary governed by
new section 5136A of the Revised
Statutes. A financial subsidiary may
engage in specified newly authorized
activities that are financial in nature and
activities that are incidental to financial
activities, if the bank and the subsidiary
meet certain requirements and comply
with stated safeguards. A financial
subsidiary also may combine these
financial subsidiary activities with
activities that are permissible for
national banks to engage in directly. The
financial subsidiary activities include
many of the activities which are
authorized for the new ‘‘financial
holding companies’’ as laid out in new
section 4(k) of the Bank Holding
Company Act (BHCA) (12 U.S.C. 1841 et
seq.) as created by section 103(a) of the
G–L–B Act. In the future, the Secretary
of the Treasury (Treasury) and the Board
of Governors of the Federal Reserve
System (FRB) may determine that
additional activities are financial in
nature and therefore authorized for a
financial subsidiary of a national bank.
Section 121(d) of the G–L–B Act,
which creates new section 46 of the FDI
Act, permits state banks to control or
hold an interest in a financial subsidiary
that engages in activities as principal.
To qualify, a state bank must comply
with four statutory conditions and a
mandatory Community Reinvestment
Act (CRA) (12 U.S.C. 2901 et seq.)
requirement found in section 103(a) of
the G–L–B Act, which added a new
subsection (4)(l)(2) to the BHCA (12
U.S.C. 1843(l)(2)).
The FDIC has a long history of
reviewing applications from state banks
to engage in activities not permissible
for national banks under section 24 of
the FDI Act (12 U.S.C. 1831a) as
implemented through part 362 of the
FDIC’s rules and regulations. As stated
in the preamble to the interim final rule,
certain activities which the FDIC
previously addressed under section 24
and subpart A of part 362, such as
general securities underwriting, are now
authorized for a financial subsidiary of
a national bank. As a result, the FDIC
will now analyze the commencement of
such activities under section 46(a)
rather than section 24, and the FDIC
will apply the restrictions contained in
subpart E rather than those in subpart A
of part 362. These statutory changes
necessitate that the FDIC conform its
regulation by limiting the sections
pertaining to such activities from
subpart A to existing subsidiaries.
Other activities conducted as
principal, such as real estate
development or investment, which are
prohibited to national bank financial
subsidiaries, are outside the scope of
section 46(a). These activities will
continue to be governed by section 24
and subpart A of part 362. State banks
that wish to engage in activities
prohibited to national banks may
continue to seek the FDIC’s consent by
filing a notice or application. Should the
Treasury and FRB in the future
determine that additional activities are
authorized for a financial subsidiary of
a national bank, state nonmember banks
commencing such activities for the first
time after such determinations will have
to proceed under section 46(a).
However, banks that obtained FDIC
consent under section 24, whether by
notice, order, or regulation before such
determination may continue to engage
in any such activity pursuant to the
requirements imposed under section 24.
II. Comments Received
The FDIC received 15 comments in
response to the interim final rule. The
comments came from four trade
associations, four state banking
departments, two community-based
associations, a law firm, a state
regulators association, a bank holding
company, and four United States
Senators. Three commenters expressed
support for the FDIC’s interim final rule.
The other commenters expressed
various objections to the rule. Several of
the commenters recommended specific
changes to the interim final rule. A
discussion of these comments and the
changes and additions made to the
interim final rule and the rule
implementing sections 24 and 18(m) of
the FDI Act are discussed in the section
by section analysis. The final rule
adopts a more streamlined process than
the interim rule. A summary of the
comments follows.
The FDIC’s interim rule to implement
section 46 of the G–L–B Act provided
that section 46 is the exclusive method
for an insured state nonmember bank to
engage in ‘‘financial subsidiary
activities.’’ Six of the comments,
including a comment from three United
States Senators, argued that Congress
intended to preserve the FDIC’s
authority to approve activities under
section 24. These commenters argued
that the preservation of authority
provision 1 was meant to ensure that the
FDIC’s authority to approve activities
under section 24 is not diminished by
section 46, and that section 46 was
intended to permit (but not require)
state banks to use the financial
subsidiary vehicle to conduct financial
or incidental activities. On the other
hand, another United States Senator
argued that the interim final rule was
consistent with the statutory language
and legislative history of the G–L–B Act
and that the interim final rule correctly
applies the G–L–B Act to require state
banks to use the financial subsidiary
vehicle to conduct financial or
incidental activities.
Four commenters argued that if
section 46 was read as the only method
under which a state nonmember bank
could engage in financial subsidiary
activities, then innovation in the state
bank system would be stifled and the
dual banking system would be
undermined. Some commenters argued
that Congress’ purpose behind section
46 was to assure state banks that they
would not be disadvantaged if national
banks are authorized to engage in
activities through financial subsidiaries
that the FDIC concludes would not be
permitted to state banks under section
24. The four commenters also noted that
although certain activities which were
previously addressed by the FDIC under
section 24 are now authorized for a
national bank financial subsidiary, the
grandfather provisions of the G–L–B
Act 2 make it clear that any activities
lawfully conducted prior to the G–L–B
Act through a subsidiary under section
VerDate 11<MAY>2000 16:40 Jan 04, 2001 Jkt 194001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 E:\FR\FM\05JAR1.SGM pfrm10 PsN: 05JAR1