The Federal Reserve Board on Sunday cleared the way for Goldman Sachs and Morgan Stanley, the nation’s last two remaining investment banks, to now operate as bank holding companies. This means that the companies can operate as commercial banks and can now take in deposits and increase their resources. The drastic move is also part of a plan to keep the institutions from collapsing.
Both banks must now abide by stricter rules set in place by the Federal Reserve. Previously, they were regulated by the Securities and Exchange Commission.
After consulting with the Justice Department, the Federal Reserve noted today that the statutory five-day antitrust waiting period will not be neccessary and the change in status will be granted immediately.
Sources:
http://www.federalreserve.gov/newsevents/press/bcreg/20080922a.htm
http://www.federalreserve.gov/newsevents/press/bcreg/20080921a.htm
http://www.npr.org/templates/story/story.php?storyId=94877512
