Finance news

Morgan Stanley and Goldman Sachs have received Federal Reserve approval to become bank holding companies.

The last two giant investment banks on Wall Street concluded that they would have more flexibility and opportunity if they submitted to supervision by the Federal Reserve. They will be able to offer Federal Deposit Insurance Corp. deposit insurance and have access to the Federal Reserve Bank Discount Window and expanded opportunities for funding. That may allow them to avoid the fate of their former rivals Bear Stearns, Lehman Brothers and Merrill Lynch.

Goldman, Sachs & Co. has an office location in the Dallas-Fort Worth Metroplex near downtown Dallas on Crescent Court, while Morgan Stanley has at least three associated offices in the area.

“While accelerated by market sentiment, our decision to be regulated by the Federal Reserve is based on the recognition that such regulation provides its members with full prudential supervision and access to permanent liquidity and funding,” says Lloyd Blankfein, chairman and CEO of Goldman Sachs, in the firm’s statement announcing the change paydayloans.

John Mack, chairman and CEO of Morgan Stanley, said in its announcement: “This new bank holding structure will ensure that Morgan Stanley is in the strongest possible position — with the stability and flexibility to seize opportunities in the rapidly changing financial marketplace.”

Goldman Sachs (NYSE: GS) plans to boost the assets of its Goldman Sachs Bank USA from $20 billion to $150 billion and further grow deposits through acquisitions.

Morgan Stanley (NYSE: MS) will convert its Morgan Stanley Bank, an industrial bank based in Utah, to a national bank.

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