Securities Dealers Group Agrees to Certify Employees of Banks

Article excerpt

WASHINGTON -- It took the heat of a congressional hearing and a private conversation between top regulators during a break, but the National Association of Securities Dealers has agreed in principle to certify bank employees to sell securities.

"I don't see that it would be a major burden to us. I think it would be fairly easy to do," Joseph Hardiman, president of the standards-setting group for broker-dealers, told a House Energy and Commerce Committee panel last week.

The move would be an important advance for banks that sell securities using their own employees.

Training Required

Recently released regulatory guidelines require bank employees to have training similar to that of registered securities representatives. But so far the NADS's exams, now used to certify most broker-dealer employees, have been closed to bank employees.

The American Bankers Association says it approached the NASD last year. The two sides disagree on what followed.

The ABA says the dealers' group flatly refused to give its exams to bank employees.

In response to a question at the hearing, Mr. Hardiman disputed that claim. He said the NASD's members had previously agreed to allow bank employees to take the licensing tests, subject to two conditions.

First, bank employees would not be allowed to sell securities until they took the test. And second, they would be forbidden to sell securities if they failed the test.

Bank employees could be tested at the group's 55 testing centers around the nation, he said. …