US Federal Reserve Board Approves Final Rule Significantly Revising Control Rules

On January 30, 2020, the Board of Governors of the Federal Reserve System approved a final rule to revise and codify its approach for determining whether one company has control over another for purposes of the US Bank Holding Company Act of 1956 and the Home Owners’ Loan Act, as amended. While in many respects the final rule codifies the Board’s existing control standards, it also introduces new concepts and raises critical questions about how the Board will implement the rule in practice. This Legal Update explains and analyzes key aspects of the Board’s rule and highlights changes from the proposed rule that was issued in April 2019.