FRB Solicits Comments Regarding Activities of Financial Holding Companies Related to Physical Commodities

The Board of Governors of the Federal Reserve System ("FRB") requested comments regarding physical commodity activities conducted by financial holding companies, including current authorizations of these activities and the appropriateness of further restrictions. The FRB is seeking public comment as part of a review of these activities, including the unique and significant risks that physical commodities activities may pose to financial holding companies, their insured depository institution affiliates and U.S. financial stability. The activities under review include (i) the nature of risks that physical commodity activities could pose to the safety and soundness of financial holding companies and to financial stability more broadly, (ii) potential conflicts of interest and other adverse effects of engagement by financial holding companies in physical commodity activities, and (iii) the potential risks and benefits of imposing additional capital requirements or other restrictions on the commodity activities of financial holding companies.

Comments must be submitted by March 15, 2014.

See: Press Release.