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 Bank
Activities Arranged by Type of Financial Institution
Credit
Reporting
Payment Services -Regulations and Guidance
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 Cash
Management
- National banks may provide cash management
services
-
OCC Interpretive Letter No 756, reprinted in
[1996-1997 Transfer Binder] Fed Banking L Rep (CCH) 181-120
11.05.96
Cash
Management Computer Software
- National banks or bank operating subsidiaries
may invest in a limited liability company that develops, produces, and
distributes or sells cash management software
- OCC Interpretive Letter No 677, reprinted in
[1994-1995 Transfer Binder] Fed Banking L. Rep (CCH) 183-625
6.28.95
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OCC Interpretive Letter No 756, reprinted in [1996-1997 Transfer Binder] Fed Banking L Rep (CCH)
181-120 11.05.96
- OCC Interpretive Letter No 284, reprinted in
[1983-1984 Transfer Binder] Fed Banking L Rep. (CCH) 85,448
3.26.84
Cashiers'
Checks, Money Orders, Savings Bonds and Travelers Checks
- National banks may issue, collect, and
process cashiers checks and money orders
- National banks may also sell savings bonds
and travelers checks
- 12 USC 24 (Seventh)
Check
Cashing and Processing
- National banks may cash and process checks, and
provide check and credit card verification services
- 12 USC 24 (Seventh)
Check Certification
- National banks may certify checks, provided the
person, firm, or corporation drawing the check has sufficient funds on deposit
to cover it
- 12 USC 501
- National banks may guarantee drafts drawn against
a bank customer
- OCC Interpretive Letter 10.29.68
(not available in electronic form)
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Correspondent Services - Regulations and Guidance
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OCC
FRB
- The FRB has no regulations pertaining to the
providing of correspondent services per se
-
Regulation F (Limitations on Interbank
Liabilities) deals at length with capital levels and credit exposure levels of a
bank with respect to its correspondents
FDIC
- The FDIC does not have any regulations that pertain directly to the providing
of correspondent services
OTS
- The
OTS does not have any regulations that pertain directly to the providing of
correspondent services. It has, however, offered some
guidance
on the subject
NCUA
- 12
CFR Part 721, Section 721 3(b) - Credit unions may provide correspondent services
- 12
CFR Part 704, Section 704 12(a)(1)
- Corporate credit union may only provide financial services to nonmembers
through a correspondent services agreement
Specific
Activities - National Banks
- National banks may hold deposits for other banks and
perform correspondent services for those banks, such as check clearing. Other
examples of correspondent services are:
 ATM Sales to Other Banks and ATM Services
- National banks may purchase ATMs for resale to
other banks, which will be in the same shared network, convert their own ATMs
into a shared network, and provide services for other banks in the network
- OCC Interpretive Letter
10.02.75
- No-Objection Letter No 87-11, [1988-1989
Transfer Binder] Fed Banking L Rep. (CCH) 84,040 11.30.87
Disaster Relief Services
- National banks may market disaster relief
services to other banks, including sharing of premises and data processing
equipment
- OCC Interpretive Letter
6.13.90
Electronic Imaging Services
- National banks may provide electronic imaging
services to banks and other financial firms
-
OCC Interpretive Letter No. 805, reprinted in
[1997-1998 Transfer Binder] Fed Banking L Rep (CCH) 81-252 10.09.97
Financial and Consulting Services
- National banks may offer financial and consulting
services, including market research and analysis, strategic planning,
advertising and promotion planning, product development, personnel management,
employee relations, affirmative action, and salary and benefit plans to banks
and commercial customers
- OCC Interpretive Letter No 137, reprinted in
[1981-1982 Transfer Binder] Fed Banking L Rep (CCH) 85,218
12.27.79
Flood Hazard Determinations
- National bank may establish an operating
subsidiary that makes flood hazard determinations for the bank, its affiliates,
and unaffiliated mortgage lenders
-
Corporate Decision No 97-79 1998 OCC QJ LEXIS 6
7.11.97
Internal Security Consulting Services
- National banks may provide internal security
consulting services, including security and guard services at affiliate banks
and non-national bank affiliates and may install and maintain vaults, locks, and
ATMs for third-party banks
- OCC Interpretive Letter No. 398, reprinted in
[1988-1989 Transfer Binder] Fed Banking L Rep. (CCH) 85,622
9.28.87
Investment Portfolio Management Service
- National bank may establish an operating
subsidiary to provide investment portfolio management services and computer
networking services for the bank and other financial institutions
-
OCC Interpretive Letter No 754 reprinted in
[1996-1997 Transfer Binder] Fed Banking L Rep (CCH) 81,118 11.06.96
Loan Collection and Repossession Services
- National banks may offer loan collection and
repossession services for other banks and thrifts
- OCC Interpretive Letter 12.14.83
- OCC
Interpretive Letter 3.15.71
Other Correspondent Services
- National banks may print and market checks,
drafts, loan payment coupons, and other banking documents; perform tax planning
and tax preparation assistance; and perform financial data processing for
correspondent banks
- OCC Interpretive Letter 2.11.80
- OCC Interpretive Letter 10.14.75
Payment and Information Processing Services
- National banks may establish an operating
subsidiary that engages in payment and information processing services
- The subsidiary may own/operate/sell electronic
data processing and data interchange facilities, which will be used to
communicate billing and payment-related information to insurance carriers
responsible for paying for medical benefits
- The subsidiary may provide computer network
services, including necessary hardware to financial institutions
-
Corporate Dec No 98-12 1998 OCC QJ LEXIS 130
2.09.98
- OCC Interpretive Letter No 712, reprinted in
[1995-1996 Transfer Binder] Fed Banking L Rep. (CCH) 81-027 2.29.96
- OCC Interpretive Letter No 718 reprinted in
[1995-1996 Transfer Binder] Fed Banking L Rep (CCH) 81-033 3.14.96
- National banks may also provide lockbox services
- OCC Interpretive Letter No 635 reprinted in
[1993-1994 Transfer Binder] Fed Banking L Rep. (CCH) 83,519 7.23.93
- National banks may perform processing of county
tax assessments, tax bills, and water and sewer bills
- OCC Interpretive Letter 4.15.75
Vault Cash
- National bank may establish a
correspondent account at an unaffiliated bank in another state to
provide vault cash for the banks customers in the state
-
OCC Interpretive Letter No 796, reprinted in [1997 Transfer Binder]
Fed Banking L Rep (CCH) 81,223 8.18.97
Specific
Activities - Federal
Savings Associations
- FSAs may provide correspondent services
- 48 Fed Reg 23,032, 23,035 5.13.83
- 47 Fed Reg 17,468, 17,469 4.23.82
- FHLBB letter by Long 1.13.84
- FHLBB Op
by Barnett 10.10.82
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Finder Activities - Regulations and Guidance
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The
term "finder" refers to the bringing together of interested
parties to a transaction that the parties themselves negotiate and consummate
- Activities covered by the term include
- Making inquiries as to interest
- Introducing or arranging contacts or meetings
- Acting as intermediary and the like
OCC
FRB
-
12
CFR Part 225 Section 225.86(d)(1)
- Financial holding company may act as finder
FDIC
- The FDIC has no regulations specifically dealing
with finder activities
OTS
- The OTS has no regulations specifically dealing
with finder activities
- It has, however, offered some
guidance
on the subject
NCUA
- 12
CFR Part 721, Section 721.3(f)- Credit union may act as finder
Specific
Activities - National Banks
- National banks may serve as finders for certain goods and services,
-
i.e., they may bring parties together for a transaction that the
parties themselves negotiate and consummate
- Identifying potential parties
- Making inquiries as to interest
- Making introductions or arranging meetings of
interested parties and otherwise bringing parties together for a transaction
that the parties themselves negotiate and consummate
Hosting Commercial Web Site for Small Retailers
- National banks can host commercially enabled Web
sites for small retailers as a form of electronic finder activity
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OCC Interpretive Letter No 856, reprinted in,
[Current Transfer Binder] Fed Banking L Rep (CCH)
81-313 3.05.99
Automobile Club
- National banks may sell memberships as agent for
an automobile club
- No Objection Letter No 89-02, reprinted in
[1989-1990 Transfer Binder] Fed Banking L Rep (CCH) 83, 014 4.17.89
Automobile Sales
- National banks may act as finders for automobile
sales and financing through databases, call centers, and Internet services;
12 CFR 7.1002
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OCC
Interpretive Letter No. 741,
reprinted in [1996-1997 Transfer Binder] Fed Banking L Rep (CCH)
81-105
-
Corporate Decision No 97-60
7.07.97
Automotive Roadside Assistance Programs
- A national bank may acquire operating
subsidiaries that operate and administer automotive roadside assistance programs
and that provide credit card registration and notification services
- The bank can administer and operate auto roadside
assistance programs for third parties as permissible finder activities
- Can administer and operate a separate roadside
assistance program, made available to its credit card customers, as an
incidental activity that is convenient and useful to the administration and
operation of the programs for third parties
-
Conditional Approval
No 535
6.21.02
Government Entities
- National banks may provide electronic finder,
custodian, record keeping, and financial agent services primarily to government
entities
- Permissible activities include providing a
financial and banking data match program to enable states to match data on
delinquent, non-custodial parents
- An Internet-based electronic service that
provides a catalog of services of state or federal agencies available to the
public
- Electronic service for state governments to
process motor vehicle title applications and related payments via the Internet
- The operation of a backup call center for a
federal agency
-
Conditional Approval
No 361
3.03.00
Health Care Programs
- National banks may provide medical insurance cost
information, benefits counseling, premium collection and disbursement and
related activities
-
OCC Corp Dec
No 98-13 1999 OCC QJ
LEXIS 22 2.09.98
Insurance
- National banks may provide finder services in
connection with insurance products and services
- To identify permissible national bank
finder arrangements in the insurance context (as an alternative to section 92
authority), the OCC considers
(1) the scope of the proposed activities
(2) the existence or absence of another insurance agent or broker in the
arrangement
(3) whether the bank has a contractual relationship with an insurance company
for selling its products, and if so, the nature of relationship with an
insurance company for selling its products, and if so, the nature of the
relationship
(4) the banks compensation arrangement for the proposed activities. For
example, national banks may participate in sharing arrangements with other banks
whereby they combine their efforts to use the services of a group of independent
agencies that would solicit and sell insurance services to bank customers on
site, sharing pro rata in referred business
-
OCC Interpretive Letter No 824, reprinted in [1997-1998 Transfer Binder] Fed Banking L Rep (CCH)
81-273 2.27.98
Internet Vendors
SEC_CODE_REF_0090001192884
- National banks may provide to their customers
links to nonbanking, third-party vendors Internet Web site
-
12 CFR 7.1002;
Conditional Approval No. 221
12.04.96
- OCC Int Ltr No 611 reprinted in
[1992-1993 Transfer Binder] Fed Banking Law Rep (CCH)
83, 449 11.23.92
Investment Advisory Services
- National banks may act as finder by referring
bank customers to investment advisors
-
OCC Int Ltr No 850
1.27.99,
reprinted in [Current Transfer Binder] Fed. Banking L. Rep. (CCH)
83,202 5.18.90
- OCC Interpretive Letter 1.20.88
Nonfinancial Products
- Under its authority to act as a finder, a national bank may help arrange for the purchase of nonfinancial
products by its credit card customers
- The bank proposed to make each customer who
contacts the banks call center aware that a nonfinancial product is available
to the customer and that the bank will, upon the customers request, transmit
certain information to the products vendor
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OCC Interpretive Letter No 904
1.18.01
Sale and Support of Credit Card Incentive Plans
- A national bank operating subsidiary may sell
access to its existing credit card promotional reward points program to
unaffiliated third party merchants
- The merchants will purchase an inventory of the
programs reward points and award them to their own customers, employees or
other parties
- The points will be redeemed from a
merchandise/services catalog administered by the national bank operating
subsidiary
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Corporate Decision
No 2003-10
6.27.03
Specific
Activities - Federal Savings Associations
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FSAs may act as finders and collect referral fees for referring customers to
registered investment
advisers, subject to certain conditions, and enter into referral fee
arrangements approved by OTS
Regional Offices.
OTS Op
Ch Couns 5.05.00
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FSAs may pay referral fees to third parties for the referral
of trust business OTS Op
Ch Couns 12.21.98 TB 76-1
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FSA may, under certain circumstances, pay a fee to a person who introduces a
depositor to the FSA 12 CFR 561.16
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Consulting
and Financial Advice Investment Advising
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Financial
Adviser, In General
12 USC 24 (Seventh)
- National banks may provide financial, investment,
or economic advisory services, including advising an investment company
- Defined in
section 3 of the Investment
Company
Act of 1940
Adviser
for Mortgage or Real Estate Investment Trusts
- National banks
may serve as the advisory company for a mortgage
or real estate investment trust
Benefits
Counseling
- National banks operating subsidiary may provide
Medicare and Medicaid counseling to customers and collect and disburse insurance
benefit payments
-
Corporate Decision No. 98-13,
1999 OCC QJ LEXIS
22 2.09.98
Business
Services for the Bank or its Affiliates
- National banks
may furnish services for their internal
operations or the operations of their
affiliates, including: accounting, auditing,
appraising, advertising and public relations,
data processing and data transmission services,
databases, or facilities
- OCC Int Ltr No. 513, reprinted in
[1990-1991 Transfer Binder] Fed Banking L Rep (CCH) 83-215
6.18.90
Consumer
Financial Counseling.
- National banks may provide consumer
financial counseling
- OCC Interpretive Letter No 137,
reprinted in
[1981-1982 Transfer Binder] Fed Banking L Rep (CCH) 85,218
12.27.79
- Interpretive
Ruling 7.17.86 OCC
Interpretive Letter No. 367, reprinted in [1985-1987 Transfer Binder]
Fed Banking L Rep (CCH) 85,537 8.19.86
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12 CFR 5.34(e)(2)(ii)(I)
12 CFR 9.10
Credit
Card Registration and Notification Services
- A national bank
operating subsidiary may engage in credit card
registration and notification services
- The subsidiary would also provide other services
including a price protection service, a referral service for customers to third
parties who offer extended warranty programs for various products, a free credit
report annually, a newsletter containing consumer credit suggestions, and
reimbursement for locksmith services
-
Conditional Approval No 535
6.21.02
Economic
Analysis
- National banks may furnish general economic
information and advice, economic statistical forecasting services, and industry
studies
-
12 CFR 5.34(e)(5)(v)(I)
Employee
Benefit and Payroll Business
- A national bank may hold a noncontrolling equity
investment in a company that will provide employee benefit and payroll services
to small community banks and their small business customers
- The investment was incidental
to the banks business because it involved preparing and conveying financial
information to the banks customers and their employees
- It would also benefit the banks small business
customers by providing services to them that would not be cost efficient for
those customers to provide for themselves
-
OCC Interpretive Letter No 909
5.02.01
Employee
Benefit, Compensation Advisory and Human Resource Services
- A national bank operating subsidiary may provide
employee benefit, compensation advisory and related administrative services, and
other human resources services to the banks business customers and other
businesses in the banks market area
- Corporate
Decision No. 2002-2
1.09.02
Employee
Benefits
- National banks may offer employee benefit
consulting services (including health benefit consulting) to corporations
wishing to establish qualified benefit plans and relocation consulting for
employees of a bank or its affiliates, or customers of the bank
-
Corp Decision No 98-51, 1999 OCC QJ
LEXIS 28 11.30.98
- National banks operating subsidiary may also
provide Medicare and Medicaid counseling to customers and collect and disburse
insurance benefit payments
-
Corp Decision No 98-13, 1999 OCC QJ
LEXIS 22 2.09.98
Employee
Relocation Benefit Consulting Service
- National banks operating subsidiary may provide
employee relocation benefit consulting services to small- and medium-sized
business customers of the bank and their employees
- The service consists of financial planning and
counseling, mortgage lending, and acting as a finder, each of which is a
permissible banking activity
-
Corporate Decision No 99-43
11.29.99
Financial
Consulting and Advisory Services
- National banks may engage in financial consulting
and advisory services for other financial institutions and the general public,
including, among other things, acting as a conduit in conveying loan terms to
prospective borrowers or purchasers, supplying financial information regarding a
third party, or engaging on behalf of others in research in contemplation of
prospective transactions
- 12 USC 24(Seventh) 92a OCC Interpretive Letter
No 238 reprinted in [1983-1984 Transfer Binder] Fed Banking L Rep
(CCH) 85,402 2.09.82
Financial
Planning and Insurance
- National bank may sell a small amount of
long-term care and disability insurance and group health, medical, and dental
insurance plans in connection with the comprehensive financial planning and
employee benefits consulting services offered by the national bank
- Letter from Julie L Williams Chief Counsel
1.19.99
- Letter from Julie L Williams Chief Counsel
12.31.97
Fiscal
Planning Advice to Municipalities
- National banks may offer fiscal planning advice
on such questions as the timing and structure of bond issues to municipalities
- OCC Interpretive Letter No 122 [1981-1982
Transfer Binder] Fed Banking L Rep (CCH) 85,203 8.01.79
- They may also offer financial advice regarding
public offerings of debt or equity, private placements, sale-leasebacks, and
purchases and sales of companies
- OCC Interpretive Letter from J
T Watson Deputy
Comptroller 7.22.74
Human
Resources Services
- National banks operating subsidiary may provide
human resources and related services to small business clients, including:
- acting as co-employer of customers employees (employee leasing);
- payroll processing;
-employee benefits consulting and human resources administrative services;
- compliance administration and safety and risk management;
- the sale of certain insurance products to employees through an insurance agency
subsidiary;
- insurance-related administrative services
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Conditional Approval No 384
4.25.00
Investment
Advisor May Hold Special Equity Interests
- A national bank operating subsidiary may receive
compensation for management and performance fees in the form of a special
limited interest profit allocation in the private investment funds for which it
serves as investment manager and advisor
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Conditional Approval No 578
2.27.03
Loss
Notification and Credit Monitoring Services
- A national bank may provide its customers with
credit card loss notification services
- This letter also approves, for the first time,
providing credit scores, credit reports, and credit monitoring services to
customers
- It also approves providing customers with access
to their Social Security, medical, and motor vehicle records as activities that
are incidental to banking
-
OCC Interpretive Letter No 944
8.12.02
Part
of, or Incidental to, Investment Advisory Services
- National banks investment management operating
subsidiary may hold small interest in certain investment funds, subject to
limitations, but only when the holding is necessary to conduct permissible
investment advisory activities
- Investors in these funds require investment
advisors to hold small interests to enhance the alignment of interests between
advisors and investors
- Certain of the funds may contain bank-ineligible
financial instruments, including equity securities
-
OCC Interpretive Letter No 897
10.23.00
- Letter from Julie L. Williams, First Senior
Deputy Comptroller and Chief Counsel, dated 10.01.99
Tax
Servicess
Welfare-to-work
Counseling
- National banks operating subsidiary may acquire
a company engaged in providing government welfare-to-work counseling
- The acquired company counsels welfare-to-work
program beneficiaries on work skills and program benefits, connects them with
potential employers, and handles payments from the sponsoring government agency
to employers and employees participating in the program
-
Corporate Decision No. 2000-11
6.24.00
Transactional
Advice, In General
- National banks may provide financial and
transactional advice to customers and assist customers in structuring,
arranging, and executing various financial transactions
- 12 USC 24 (Seventh)
Commercial Real Estate
Equity Financing
- National banks may arrange for commercial real
estate equity financing
- OCC Interpretive Letter No 387 reprinted in
[1988-1989 Transfer Binder] Fed Banking L Rep (CCH) 85, 611
6.22.87
- OCC Interpretive Letter No 271 reprinted in
[1983-1984 Transfer Binder] Fed Banking L Rep (CCH) 85, 435
9.21.83
Economic
Research
- National banks may conduct financial feasibility
studies
- 12 USC 24 (Seventh)
Mergers,
Acquisitions, Divestitures, Joint Ventures, Leveraged Buyouts,
Recapitalizations, Capital Structurings, and Financial Transactions
- Including private and public financings and loan
syndications
- 12 USC 24 (Seventh)
- National banks may provide financial and
transactional advice in connection with the previously mentioned activities
-
12 CFR 9.101
Messenger
Service
- A national bank may provide consulting and
advisory services to deposit customers who hire independent messenger or courier
services to transport banking items to and from the bank
-
OCC Interpretive Letter No 1023
2.24.05
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Other Services for Customers
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