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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 video webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Thursday, October 29, 2020

Recorded event now available

or call 1-800-926-7926

This CLE course 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.


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 steps to allow a bank to function without the BHC umbrella.

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

In recent years a handful of BHCs have merged or liquidated into their bank subsidiaries, eliminating the 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.

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 are the additional operational flexibilities of BHCs?
  • How does the Small BHC Policy Statement impact the analysis for banks with under $1 billion in assets?
  • What are the regulatory and cost considerations of forming and operating as a BHC?
  • When might it be desirable to merge a BHC (and affiliates) into a bank?


Kirby, Samantha
Samantha M. Kirby

Partner; Co-Chair of the Banking and Consumer Financial Services Practice
Goodwin Procter

Ms. Kirby advises boards and management of financial institutions and other financial services firms on strategic...  |  Read More

MacDonald, Ralph
Ralph F. (Chip) MacDonald, III

Of Counsel
Jones Day

Mr. MacDonald is a financial services lawyer who focuses on M&As, public and private securities, governance, and...  |  Read More

Waack, Donald
Donald S. Waack

Morgan Lewis & Bockius

Mr. Waack counsels globally active financial services firms on their most challenging regulatory, transactional, and...  |  Read More

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