National banks and federal savings associations (FSAs) are prohibited as of April 1 from dealing or investing in industrial or commercial metals under a rule finalized Dec. 28 by the OCC.
According to an OCC press release, the final rule covers metal, including alloy, in a physical form primarily suited to industrial or commercial uses. Examples include copper cathodes and aluminum T-bars. The final rule supersedes a prior OCC determination permitting national banks to trade copper.
“The rule continues to recognize that national banks and FSAs may hold industrial or commercial metal under authorities that are distinct from dealing and investing and does not change those authorities,” the OCC stated in a press release. “For example, national banks and FSAs may acquire industrial or commercial metal through foreclosures on loans and then sell the metal to mitigate loan losses.”
Although the effective date is April 1, banks with existing holdings of industrial and commercial metal acquired through dealing or investing activities must divest of such metal as soon as reasonably practical, but no later than five years, OCC stated.