[Federal Register Volume 60, Number 50 (Wednesday, March 15, 1995)]
[Notices]
[Pages 13987-13988]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-6350]



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FEDERAL RESERVE SYSTEM

Norwest Corporation; Application to Engage in Nonbanking 
Activities

    Norwest Corporation, Minneapolis, Minnesota, (Applicant), has filed 
notice pursuant to section 4(c)(8) of the Bank Holding Company Act (12 
U.S.C. 1843(c)(8)) (BHC Act) and Sec.  225.23(a)(3) of the Board's 
Regulation Y (12 CFR 225.23(a)(3)) to engage in the activity of 
providing for a fee employment information, including salary, length of 
employment and name of employer, [[Page 13988]] through its wholly-
owned subsidiary, Norwest Mortgage Corporation, Des Moines, Iowa 
(Norwest Mortgage). Norwest Mortgage would provide this information to 
affiliated and unaffiliated depository institutions, and to other 
creditors for use in connection with an extension of credit including a 
lease transaction that is the functional equivalent of an extension of 
credit. These activites will be conducted nationwide.
    Section 4(c)(8) of the BHC Act provides that a bank holding company 
may, with Board approval, engage in any activity which the Board, after 
due notice and opportunity for hearing, has determined (by order or 
regulation) to be so closely related to banking or managing or 
controlling banks as to be a proper incident thereto. This statutory 
test requires that two separate tests be met for an activity to be 
permissible for a bank holding company. First, the Board must determine 
that the activity is, as a general matter, closely related to banking. 
Second, the Board must find in a particular case that the performance 
of the activity by the applicant bank holding company may reasonably be 
expected to produce public benefits that outweigh possible adverse 
effects.
    A particular activity may be found to meet the ``closely related to 
banking'' test if it is demonstrated that banks have generally provided 
the proposed activity; that banks generally provide services that are 
operationally or functionally similar to the proposed activity so as to 
equip them particularly well to provide the proposed activity; or that 
banks generally provide services that are so integrally related to the 
proposed activity as to require their provision in a specialized form. 
National Courier Ass'n v. Board of Governors, 516 F.2d 1229, 1237 (D.C. 
Cir. 1975). In addition, the Board may consider any other basis that 
may demonstrate that the activity has a reasonable or close 
relationship to banking or managing or controlling banks. Board 
Statement Regarding Regulation Y, 49 FR 806 (1984).
    Applicant believes that the proposed activities meet the National 
Courier standard because: (1) employment and salary history information 
is information that is routinely obtained by a bank in connection with 
an extension of credit; (2) the information to be provided is primarily 
financial in nature because the relevant information is the amount of 
salary or wages earned by an individual over a period of time; and (3) 
the proposed activities are operationally and functionally similar to 
operating a credit bureau pursuant to Sec.  225.25(b)(24) of Regulation 
Y.
    In order to satisfy the proper incident to banking test, section 
4(c)(8) of the BHC Act requires the Board to find that the performance 
of the activities by Company can reasonably be expected to produce 
benefits to the public, such as greater convenience, increased 
competition, or gains in efficiency that outweigh possible adverse 
effects, such as undue concentration of resources, decreased or unfair 
competition, conflicts of interest, or unsound banking practices. 
Applicant believes that the proposed activities will benefit the public 
by promoting competition. Applicant believes that the proposed 
activities will not result in any unsound banking practices or other 
adverse effects.
    In publishing the proposal for comment, the Board does not take a 
position on issues raised by the proposal. Notice of the proposal is 
published solely in order to seek the views of interested persons on 
the issues presented by the application and does not represent a 
determination by the Board that the proposal meets, or is likely to 
meet, the standards of the BHC Act.
    Any comments or requests for hearing should be submitted in writing 
and received by William W. Wiles, Secretary, Board of Governors of the 
Federal Reserve System, Washington, D.C. 20551, not later than March 
29, 1995. Any request for a hearing on this application must, as 
required by Sec.  262.3(e) of the Board's Rules of Procedure (12 CFR 
262.3(e)), be accompanied by a statement of the reasons why a written 
presentation would not suffice in lieu of a hearing, identifying 
specifically any questions of fact that are in dispute, summarizing the 
evidence that would be presented at a hearing, and indicating how the 
party commenting would be aggrieved by approval of the proposal.
    This application may be inspected at the offices of the Board of 
Governors or the Federal Reserve Bank of Minneapolis.

    Board of Governors of the Federal Reserve System, March 9, 1995.
Jennifer J. Johnson,
Deputy Secretary of the Board.
[FR Doc. 95-6350 Filed 3-14-95; 8:45 am]
BILLING CODE 6210-01-F