FOR IMMEDIATE                                       2001-73


  SEC Further Extends Time for Banks to Comply with Gramm-
Leach-Bliley Act Broker-Dealer Registration Requirements and
                   Extends Comment Period

Washington, DC, July 18, 2001 -- The Securities and Exchange
Commission announced today that it issued an order further
extending until May 12, 2002 the compliance dates for banks
with respect to the broker-dealer registration requirements
contained in the Gramm-Leach-Bliley Act.  The Commission
also indicated that it anticipates amending the interim
final rules it issued on May 11, 2001, concerning these
requirements, and the Commission issued a notice extending
the comment period on the rules until September 4, 2001.
The Commission does not expect banks to develop compliance
systems until the Commission amends its rules.  Banks have
indicated that they may need as much as a year to develop
compliance systems to adapt to the Gramm-Leach-Bliley Act
and the rules.   The Commission expects to extend the
compliance date further so that banks will have sufficient
time to respond to changes to the rules.

The Gramm-Leach-Bliley Act repealed a full exception that
had allowed banks to engage in securities activities without
registering as a broker or dealer and replaced the full
exception with new functional exceptions.  The new
functional exceptions became effective May 12, 2001.  On May
11, 2001, the Commission issued interim final rules defining
terms in the statutory exceptions and granting banks
additional exemptions from broker-dealer registration.  The
Commission gave banks until October 1, 2001, and with
respect to their non-compliant compensation arrangements,
until January 1, 2002 to bring their activities into
compliance.  These time periods have now been extended until
May 12, 2002.

The Commission granted the latest extension to provide the
Commission with time to explore with banks possible means of
reducing compliance costs.  The extension also will allow
the Commission time to amend its rules while providing banks
additional time to seek compliance advice regarding issues
under the Gramm-Leach-Bliley Act and to explore forming
relationships with broker-dealers if necessary.  Three weeks
ago, the Director of the Division of Market Regulation
informed the American Bankers Association Securities
Association that requests for extensions of time for banks
to come into compliance could be appropriate and would be
carefully considered.  This extension of time addresses
these requests.

The text of the order and notice will be available on the
Commission's website at http://www.sec.gov.


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