SIA TO APPEAL FED RULING ON COMMERCIAL PAPER
The Securities Industry Association,
SIA, has asked the U.S. supreme court to overturn a lower-court
ruling that would allow banks to sell commercial paper, SIA
general counsel William Fitzpatrick said.
    In a petition, the SIA said the court of appeals erred in
upholding the decision of the Federal Reserve board of
governors to permit Bankers Trust New York Corp <BT> to
underwrite and distribute commercial paper.
    The SIA charged that the Fed's ruling violates the 1933
Glass-Steagall Act barring banks from underwriting most types
of securities.
    The court of appeals decision, issued last December,
reversed an earlier district court ruling that selling
commercial paper is an improper bank activity and that private
placements by banks is also improper.
    In an earlier round of the case, decided in 1984, the
Supreme Court upheld the SIA's contention that commercial paper
is a security for the purposes of th Glass-Steagall Act.
    The SIA is a trade association representing the interests
of more than 500 U.S. investment banks and securities firms.
 Reuter
