Regulatory Alerts2012-03-22
Underwriting Issues of Securities
The Supervisor of Banks mandates that banking corporations establish internal policies and procedures governing their activities as underwriters of securities issues. The regulation imposes specific capital-based restrictions, including a general limit of 50% of capital for total underwriting commitments and a 10% to 24% limit for single-issuer exposure. Additional prohibitions prevent banks from underwriting issues that would result in controlling stakes in other banks or engaging in unauthorized investment activities.
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