FOR IMMEDIATE RELEASE

CONTACT:
Sean Oblack
202.649.4629

Washington, D.C. — July 8, 2014 — Today, The Clearing House Association (TCH), joined by the American Bankers Association and Financial Services Roundtable, submitted a comment letter to the Federal Reserve on its proposed rule to implement Section 622 of the Dodd-Frank Act (Section 622).  The letter stresses the practical importance of ensuring that Section 622 is implemented in a manner that is transparent, predictable and, most importantly, avoids unnecessary and unintended restrictions on ordinary course business activity that falls outside of Section 622’s intended scope. 

“This letter offers a number of recommendations that we believe would help mitigate certain practical challenges associated with the proposal while still remaining consistent with the purpose and intent of Section 622,” said Gregg Rozansky, Managing Director and Senior Associate General Counsel for The Clearing House Association. “The Clearing House appreciates the opportunity to comment on the Federal Reserve’s proposed rulemaking.”

 Section 622 generally prohibits banking organizations and systemically-important non-bank financial institutions from making an acquisition if the “liabilities” of the combined company would exceed 10% of the aggregate consolidated liabilities of all financial companies operating in the United States. 

The comment letter offers a number of specific recommendations that TCH believes would improve the final rule, including:

• excluding a wider range of ordinary course business activities, including community development investments and investments in small business investment companies, from the scope of the concentration limit;
• adjusting the proposal’s implementation of the statutory de minimis exclusion to ensure that it is workable and effective when applied in practice; and
• providing greater disclosure of information underlying the Federal Reserve’s proposed Section 622 limit calculation methodology.

 About The Clearing House Established in 1853, The Clearing House is the oldest banking association and payments company in the United States. It is owned by the world’s largest commercial banks, which hold more than half of all U.S. deposits. The Clearing House Association L.L.C. is a nonpartisan advocacy organization representing – through regulatory comment letters, amicus briefs and white papers – the interests of its owner banks on a variety of important banking issues. Its affiliate, The Clearing House Payments Company L.L.C., provides payment, clearing and settlement services to its member banks and other financial institutions, clearing almost $2 trillion daily which represents nearly half of the automated clearing-house, funds transfer, and check-image payments made in the U.S. See The Clearing House’s web page at www.theclearinghouse.org.