Pros and Cons of Bank Holding Companies: Determining Whether a Bank Holding Company Structure Makes Sense for Your Bank

Recording of a 90-minute premium CLE webinar with Q&A

Conducted on Thursday, October 12, 2017

Recorded event now available

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Program Materials

This CLE webinar will examine pros and cons of operating under a bank holding company or financial holding company (BHC) vs. a simple stand-alone bank structure. The presentation will include a discussion of the federal laws and regulations regarding permissible activities for banks and their holding companies. The panel will also discuss potential benefits and costs of merging a BHC into a bank.


A handful of BHCs have merged or liquidated into their bank subsidiaries, most recently Bank of the Ozarks, which eliminated its BHC by merging it into the bank. These mergers are done to simplify financial reporting, reduce Federal Reserve oversight and SEC registration costs, and consolidate governance and organizational structure.

Bank holding companies are frequently used to engage in a variety of activities that are financial in nature but outside of traditional depository activities, usually through affiliates under the ownership umbrella of a BHC. However, banks can also now engage in many activities deemed closely related to banking or financial in nature without requiring a BHC.

In deciding whether a BHC is the best route to conduct its businesses, banks should weigh the operational flexibility of BHCs against the added administrative and regulatory costs.

Counsel must have a thorough understanding of the permitted activities of banks vs. BHCs, and what steps might be taken to allow a bank to function without the BHC umbrella.

Listen as our authoritative panel discusses the regulatory framework in which banks and BHCs operate, and the non-banking activities which are permitted for each. The panel will also discuss the logistics of merging a BHC into a bank, and issues to consider in deciding whether to do so.



  1. Regulatory framework for banks
  2. Bank holding companies and financial holding companies
  3. Small BHC Policy Statement—impact on banks with under $1 billion in assets
  4. Disadvantages of BHCs
  5. Advantages of BHCs
  6. Eliminating an existing BHC into a bank—procedural issues


The panel will review these and other key issues:

  • What kinds of activities and investments are allowed for banks beyond traditional banking activities?
  • What additional operational flexibility is afforded BHCs
  • How does the Small BHC Policy Statement affect the analysis for banks with under $1 billion in assets?
  • What are the regulatory and cost considerations of forming and operating as a BHC?
  • What additional flexibility can a BHC provide?
  • When might it be desirable to merge a BHC (and affiliates) into a bank?


Klingler, Robert
Robert D. Klingler

Bryan Cave

Mr. Klingler regularly counsels financial institutions, with an emphasis on mergers and acquisitions, capital...  |  Read More

Stanford, Clifford
Clifford S. Stanford

Alston & Bird

Mr. Stanford leads the Firm's Bank Regulatory Team, providing experienced advice and strategic counsel to U.S. and...  |  Read More

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