Law360 / DPK in the News
Master Account Suit Of 'Narrow Bank' Isn't Ripe: NY Fed
"The Federal Reserve Bank of New York on Tuesday previewed its anticipated bid to escape a lawsuit from a new “narrow bank” that alleges it’s been unfairly blocked from receiving a Fed master account, telling a Manhattan federal judge that the case is premature because the bank’s application is still under review. The Connecticut-based TNB USA Inc. — as in “the narrow bank” — filed a lawsuit at the end of August seeking to force the New York Fed to give it a master account, which the bank says it needs to implement its strictly limited business plan of taking deposits from large institutional money market investors and stashing them at the Fed, where they would earn higher interest rates than at a normal bank... ...The New York Fed urged the court to disallow TNB’s attempt to have it second-guess the Fed’s judgment in this regard. “There is nothing in the FRA indicating that the New York Fed must provide TNB a master account under any circumstances, let alone where so doing would interfere with the Federal Reserve’s ability to carry out its important statutory mandates,” the New York Fed said. Thomas E.L. Dewey, a Dewey Pegno & Kramarsky LLP partner representing TNB, told Law360 that his side looks forward to presenting its arguments to the court. 'As explained in TNB's complaint, we believe that both the governing statute and applicable caselaw are clear that TNB is entitled to open a master account,' Dewey said. TNB is represented by Thomas E.L. Dewey, David S. Pegno and Anders W. Pauley of Dewey Pegno & Kramarsky LLP."
Master Account Suit Of 'Narrow Bank' Isn't Ripe: NY Fed Law360, October 17, 2018 By Jon Hill