Certified Regulatory Compliance Manager (CRCM) — Question 262

Which of the following transactions does NOT require prior approval of the Federal Reserve Board?

Answer options

• A. The formation of a bank holding company
• B. The acquisition by a bank holding company of a subsidiary
• C. The acquisition of 25 percent of voting stock of a bank by another bank, in good faith, in its fiduciary capacity with no power to vote
• D. The acquisition of 25 percent of voting stock of a bank by another bank in its fiduciary capacity for the benefit of the acquiring bank's employees

Correct answer: C

Explanation

The correct answer is C because acquiring stock in a fiduciary capacity without the ability to vote does not require Federal Reserve Board approval. Options A and B involve significant changes to a bank's structure or ownership that necessitate prior approval, while option D also involves a fiduciary capacity but is tied to employee benefits, which still requires regulatory oversight.