Securities RegistrationQuestion 54 of 100
An investor is offered shares of a bank holding company that owns a single commercial bank. Regarding state registration, these shares are:
a.Exempt securities, because the underlying subsidiary is a bank
b.Not automatically exempt, because the exemption covers securities issued by a bank itself, not by a separate holding company
c.Exempt transactions in every case
d.Federal covered securities regardless of where they trade
Explanation
The exemption is drafted around securities issued or guaranteed by a bank, savings institution, or trust company; a holding company is a separate corporate issuer and does not inherit its subsidiary's status. Such shares may still qualify as federal covered securities if they are listed on a national exchange, but that depends on listing, not on the banking business. Nothing about the sale makes it an exempt transaction by default.
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