Banking Interpretations

NYSBL 200; 221-a

November 9, 2006


Dear [---]:

In your letter dated October 11, 2006 to Deputy Superintendent and Counsel Sara Kelsey, supplemented by your email to me of November 8, 2006, you asked for written confirmation of the New York State Banking Department's ("Department's") view concerning the following.

Your client, a foreign bank, currently has operations in the United States outside of the State of New York and is subject to regulation by the Board of Governors of the Federal Reserve System as a foreign banking organization.  The foreign bank intends to establish a U.S. subsidiary incorporated in New York that would engage in investment adviser and management services for the foreign bank. In its capacity as investment adviser for the foreign bank, the subsidiary would identify permissible investments and manage an account for the foreign bank, The foreign bank would provide the appropriate notices to the Federal Reserve for forming the subsidiary and engaging in investment adviser activities in the United States.

This will confirm the Department's view that, as a separately incorporated entity with its own capital, and considering that the activities of the entity are limited to providing the described investment advisory services to the foreign bank itself, the entity would not require licensing, either as a representative office or otherwise, by the Department.

I trust that this is helpful.

Rosanne Notaro
First Assistant Counsel - Banks