Magazine article American Banker

NASD Eases Proposed Curbs on Bank Sales

Magazine article American Banker

NASD Eases Proposed Curbs on Bank Sales

Article excerpt

The National Association of Securities Dealers is amending its controversial plan to regulate bank brokerages, a top official said.

The group will soften restrictions it planned for joint marketing of bank products and investment products, said R. Clark Hooper, the association's vice president for advertising.

Banks will, however, have to include sufficient disclosure to differentiate between bank products and investment products, Ms. Hooper said.

Ms. Hooper's statements, made at the NASD's New York office Tuesday, offer the first peek at how the group is responding to bankers' criticism of the proposed brokerage rules, which were unveiled late last year.

The NASD views the measures, which would monitor selling and marketing activities at bank brokerages, as a way of protecting customers.

The NASD, a self-regulatory body that oversees brokerages, and its committee of bank brokerage representatives expect to present a final draft of the rules to the NASD's board of governors in September, Ms. Hooper said.

She declined to detail concessions and amendments that have been made so far, but did offer some insights.

To cut duplication and confusion, Ms. Hooper said the NASD will probably scrap parts of the proposal that are similar to the association's rules of fair practice, which bank brokerages and other investment companies already follow.

But NASD staff and bankers are still at odds over a number of measures, including restrictions on referral fees and the use of customer information to solicit brokerage accounts. …

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