Corporate Applications and Other Requests:
Vol. 19, No. 8
IN THIS ISSUE:
| Letter No.
||Letter concludes that a national bank may hedge the risks arising from bank
permissible, customer-driven derivative transactions using below-investment
grade bonds, and that when the bank acquires such bonds for this purpose, it is
subject to the standards applicable to derivative hedges and not the
limitations of 12 C.F.R. Part 1 applicable to investment securities.
||Letter concludes that it is legally permissible for national banks to engage in
customer-driven, perfectly matched, cash-settled derivative transactions with
payments based on 11 categories of reference assets related indices.
||Letter permits bank to use, pursuant to the OCC's reservation of authority, an
alternative calculation based on the bank's value at risk model (VAR approach)
to determine the risk-based capital charge for certain securities lending
transactions. Under the VAR approach, the risk-based capital charge would be
based on a measure of economic exposure that takes into account the market
value of collateral received and security lent, as well as the market price
volatilities of both the securities lent by the bank and received as
||Letter clarifies that "service costs" paid on an innovative capital instrument
by an operating subsidiary to third party investors constitutes a dividend for
the purposes of 12 USC 60. However, to avoid double counting of the service
costs, the bank may adjust its net income for distributions on innovative
capital instruments that are treated as dividends. 02/28/2006
||Letter concludes that laws recently enacted in some states that prohibit or
restrict branching by out-of-state industrial loan companies into the enacting
state undercut those states' laws permitting interstate de novo branching by
banks generally. The result is that under the Riegle-Neal Interstate Banking
and Branching Efficiency Act of 1994, federal regulators cannot approve the
establishment of de novo branches in such states by any out of state
| Letter No.
||Application by Sunflower Bank, National Association, Salina, Kansas to
establish an operating subsidiary to facilitate the purchase of Kansas State
Rehabilitation Tax Credits. (Control Number 2006 WE 08 020), 07/12/2006
||Application to merge in Elmira Savings and Loan, F. A., Elmira, New York, under
the charter and title of Community Bank, National Association. (Control Number
2006 NE 02 0010), 07/27/2006
Approvals with conditions enforceable under 12 U.S.C. 1818
| Letter No.
||Application to establish a new national bank with the title of "National Bank
of Southwest Florida," Port Charlotte, Florida. (Control Number 2006 SO 01
||Application by UBS AG to establish a limited federal branch with the title of
UBS 299 Wealth Management New York Branch. (Control Number 2006 IB 10
||Application to establish a new national bank with the title of "TCF National
Bank," Mesa, Arizona. (Control Number 2006 CE 01 004), 07/17/2006
||Application to establish a new national bank with the title of "Heritage Bank,
National Association," Phoenix, Arizona. (Control Number 2006 WE 01
Final Enforcement Actions
Enclosed is a copy of the OCC's news release number
2006-86, announcing the availability of enforcement actions.
Copies of the final actions are available by writing to the OCC, Public
Information Room, Mail Stop 1-5, Washington, D.C. 20219. When ordering, specify
the appropriate enforcement action number.
Community Reinvestment Act (CRA) Performance Evaluations
Enclosed is a list of CRA performance evaluations that became public during the
period of July 15, 2006 through August 14, 2006.
PLEASE NOTE: Interpretive Letters and No-Objection Letters reflect the views of
the Comptroller's legal staff. Corporate Decisions, CRA Decisions and
Conditional Approvals are from the office of Licensing. The Community
Development Investment Letters are from the office of Community Affairs. The
list of CRA Ratings is from the Communications Division. For copies of the CRA
evaluations, you may either contact the bank directly, or you may write to the
Office of the Comptroller of the Currency (OCC) in any of three ways: by mail
to the OCC, Attn: Public Information Room, Mail Stop 1-5, Washington, D.C.
20219; by fax to (202) 874-4448; or by e-mail to FOIA-PA@occ.treas.gov.
You may also write to the OCC for copies of enforcement actions and charters
with standard conditions.
Members of the news media are encouraged to cite the letter number when
reporting or summarizing documents from this package. This helps us to process
single requests based upon your citation in a timelier manner.
The Office of the Comptroller of the Currency publishes INTERPRETATIONS AND
ACTIONS monthly. Subscriptions are available at a rate of $200 per year by
writing to the Comptroller of the Currency, ATTN: Accounts Receivable, Mail
Stop 4-8, 250 E Street, S.W., Washington, DC 20219. Prepayment is requested.
Suggestions, comments or questions may be sent to Jacqueline J. England,
Comptroller of the Currency, Communications Division, Mail Stop 3-2,
Washington, DC 20219.