PRINTER'S NO. 1201
No. 60 Session of 1989
INTRODUCED BY F. TAYLOR, GALLEN, LESCOVITZ, COY, HALUSKA AND
DONATUCCI, APRIL 5, 1989
REFERRED TO COMMITTEE ON RULES, APRIL 5, 1989
A CONCURRENT RESOLUTION
1 Opposing proposed Federal regulations on the permissible
2 activities of state-chartered banks.
3 WHEREAS, The strength and vitality of this country's
4 financial marketplace has depended in large part upon the
5 separate state and Federal regulation of this country's state-
6 chartered and federally chartered banks, respectively; and
7 WHEREAS, The General Assembly and regulatory officers acting
8 in accordance with State law have historically had authority
9 over the activities of banks and other financial institutions
10 organized under the laws of this Commonwealth; and
11 WHEREAS, In exercising their responsibility pursuant to such
12 authority, the General Assembly and State banking regulators
13 have always acted to promote the safety and soundness of the
14 Commonwealth's financial institutions while simultaneously
15 recognizing that such institutions must evolve to meet the needs
16 of a dynamic, rapidly changing marketplace for financial
17 services; and
1 WHEREAS, The General Assembly and State banking regulators
2 have balanced the competing goals of bank regulation with great
3 success, as evidenced by the tremendous growth in this
4 Commonwealth of safe and sound financial institutions which
5 provide the public with a wide array of needed financial
6 services; and
7 WHEREAS, Under our nation's "dual banking system," the
8 President, Congress and Federal regulatory officials have
9 traditionally limited their direct regulation of financial
10 institutions to those organized under Federal law; and
11 WHEREAS, In recognition of the primacy of state legislatures
12 and bank regulators with respect to the regulation of state-
13 chartered financial institutions, Federal law has historically
14 been drafted and interpreted so as not to intrude upon the
15 regulatory authority of state legislatures and bank regulators;
16 and
17 WHEREAS, The Federal Reserve Board has recently proposed to
18 amend the provisions of its Regulation Y, enacted pursuant to
19 the Bank Holding Company Act of 1956 (70 Stat. 133, 12 U.S.C. §
20 1841 et seq.), to prohibit state-chartered financial
21 institutions from engaging in various activities otherwise
22 permissible under state law; and
23 WHEREAS, The amendments to Regulation Y proposed by the
24 Federal Reserve Board would directly interfere with and usurp
25 the historic authority of the states to determine the range of
26 activities in which state-chartered financial institutions may
27 engage; and
28 WHEREAS, The amendments to Regulation Y proposed by the
29 Federal Reserve Board wrongly presume that the states are
30 incapable of monitoring the continued safety and soundness of
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1 state-chartered financial institutions; and
2 WHEREAS, The amendments to Regulation Y proposed by the
3 Federal Reserve Board wrongly presume that the Federal Reserve
4 Board is better able to assess the financial service needs of
5 the citizens of this Commonwealth than the General Assembly; and
6 WHEREAS, The amendments to Regulation Y proposed by the
7 Federal Reserve Board threaten the continued viability of our
8 nation's dual Federal and state banking systems; and
9 WHEREAS, The amendments to Regulation Y proposed by the
10 Federal Reserve Board threaten the continued ability of the
11 Commonwealth to ensure the provision of financial services in a
12 prudent manner within a procompetitive environment; and
13 WHEREAS, The Federal Reserve Board has provided parties that
14 would be affected by its proposed amendments to Regulation Y
15 with the opportunity to comment on these proposed amendments;
16 therefore be it
17 RESOLVED (the Senate concurring), That the amendments to
18 Regulation Y proposed by the Federal Reserve Board constitute a
19 legally and historically unjustifiable interference with the
20 prerogatives of the General Assembly to determine the range of
21 activities in which financial institutions organized under the
22 laws of this Commonwealth may engage consistent with safe and
23 sound banking practices; and be it further
24 RESOLVED, That a copy of this resolution be forwarded to the
25 Board of Governors of the Federal Reserve System and to each
26 member of Congress from Pennsylvania as an expression of
27 Pennsylvania's opposition to the Federal Reserve Board's
28 proposed amendments to Regulation Y.
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