Originally from:
Banking Regulation in the United States - 3rd Edition - Hardcover
Banking Regulation in the United States - 3rd Edition - Electronic
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CHAPTER XI
Real Estate Development and Data
Processing Activities
A. Real Estate Investment and Development
Bankers believe that real estate development is a natural part of
banking. After all, they assert, before they make real estate
development loans do they not undertake an independent evaluation
of the project? And is not this research and decision making the
essence of real estate development? The banks’ real estate ability is
thus well demonstrated.
However, this seemingly common sense point of view clashes
with a countervailing policy: the aversion to aggregations of
money and property, which is deep-seated in our national psyche,
and formed the basis of the “Jeffersonian” point of view we
discussed in Chapter II. Perhaps it stems from the early colonists’
memories of the feudal tradition of their homeland. In any event,
this policy was embedded in federal banking law and policy from
the beginning: when the First Bank of the United States was
created by the Congress in 1791, as we noted in Chapter II its
charter explicitly forbade, among other things, ownership of real
estate.
Early on the Supreme Court articulated three reasons for
restricting ownership of real estate by national banks:
CHAPTER XI-Real Estate Development and Data Processing Activities
A. Real Estate Investment and Development
1. Power of Banks
2. Power of Bank Holding Companies
3. Financial Holding Companies
B. Data Processing Activities
1. Nature of the Activity
2. Power of Banks
3. Power of Bank Holding Companies
Carl Felsenfeld is Professor of Law, Fordham University School of Law, and Former Vice President & Senior Attorney for Consumer and Commercial Financial Activities, Citicorp.
Professor Felsenfeld was a charter member of the Federal Reserve Consumer Advisory Council, Chairman of the American Bar Association Committee on Consumer Financial Services, Advisor to the Commissioners on Uniform State Laws in their project to write an EFI law (Article 4A of the UCC) and a representative to the United Nations Commission on International Trade Law (EFT Model Law and International Insolvency Model Law).
David L. Glass serves as Head of Risk Management Group Legal Affairs for the Americas for the Macquarie Group, a diversified financial services company based in Sydney, Australia. He is also Counsel in the New York office of Arent Fox LLP, where he works in the finance group. He is experienced in advising clients in all aspects of banking and financial regulation. With the Macquarie Group, Mr. Glass advises management regarding the structuring of the Group's US activities and oversees the regulatory relationships of its regulated entities in the United States. David also serves as the Group's anti-money laundering (AML) officer for the Americas and as Director of Compliance for its SEC-registered broker dealer subsidiary.
Prior to working at Macquarie and Arent Fox, Mr. Glass was General Counsel of the New York Bankers Association and practiced with Clifford Chance and Debevoise & Plimpton. He began his career at the Federal Reserve Bank of New York, where at various times he served as a staff attorney, Chief of the Credit Analysis Division, and Assistant to the President. He is currently an adjunct professor of law at New York Law School and Pace University School of Law, where he has taught banking, international banking, payment systems and administrative law. In 2009 he was appointed associate director of New York Law School's newly established Center for Financial Services Law; in this capacity he is assisting in the development of courses and faculty for the school's newly accredited LLM degree in financial services law. Mr. Glass served as Chair of the New York State Bar Association's Business Law Section, and is currently Chair of the Association's Banking Law Committee. He is also a member of the Banking Law Committee of the Association of the Bar of the City of New York and the Panel of Commercial Arbitrators of the American Arbitration Association.
