To All Bank Holding Companies and Others Concerned in the Second Federal Reserve District:
The following is from a statement issued by the Board of Governors of the Federal Reserve System:
The Federal Reserve Board has announced adoption of final standard practice rules regarding transactions in government securities by depository institutions.
The final rule is effective July 1, 1997.
The agencies are adopting the final rules to provide consistent treatment for customers of both bank and nonbank dealers, and brokers in government securities.
The rules are substantively identical to the National Association of Securities Dealers'(NASD) Business Conduct and Suitability Rules and the NASD SuitabilityInterpretation that apply to nonbank brokers and dealers in government securities.
The amendments to Regulation H and K, as published in the Federal Register of March 19, are available as a (pdf) file. Questions on this matter may be directed, at this Bank, to Jim Keogh, Supervising Examiner, Advisory and Technical Services Department.