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Federal regulators, including the Federal Reserve, the Federal Deposit Insurance Corp (FDIC), and the Office of the Comptroller of the Currency (OCC), approve bank mergers.
Applications under the Bank Holding Company Act are subject to regulatory approval by the Federal Reserve. Applications at the bank level under the Bank Merger Act are subject to regulatory approval by the primary federal regulator of the resultant bank.
Typically, a merger must be approved by the holders of a majority of the outstanding shares of the target company.
Regarding process, the Bank Holding Company Act establishes a 91-day period by which the Federal Reserve must act on a completed application for an acquisition by a bank holding company. In addition, federal banking law requires the Federal Reserve, the OCC and the FDIC to act on applications within a one-year period.
A bank acquisition happens when one company buys anotherusually smallercompany. The smaller bank becomes part of the larger bank and ceases to operate independently. Depending on the terms of the deal, the bank might keep its original name, or it could be absorbed within the larger bank.
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The Federal Reserve Board has approval authority under the BMA for Business Combinations where the resulting depository institution is a state member bank, and the FDIC has such authority where the resulting depository institution is a state nonmember bank or a state savings bank.
Answer and Explanation: The federal reserve board has the authority to approve or disapprove mergers between banks and the formation of bank holding companies.
Banking organizations are generally required to seek prior Federal Reserve approval to become a bank holding company, to acquire ownership in a bank holding company, or to engage in new activities.

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