December 16, 1997
Terry Robertson, CPA, Senior Vice President
Fixed Income Research
Thomas A. Snyder, Managing Director
Fixed Income Compliance
Morgan Keegan & Co., Inc.
50 Front Street
Memphis, TN 38103
Dear Messrs. Robertson and Snyder:
You have asked whether Morgan Keegan may continue to safekeep
securities for federal credit unions (FCUs) under Section 703.60
of the revised rules governing investment and deposit activities
issued by the National Credit Union Administration (NCUA) Board
in June 1997. 62 Fed. Reg. 32989 (1997). It may under an interim
final rule issued by the NCUA Board on November 24, 1997, which
further amended Section 703.60. 62 Fed. Reg. 64146 (1997).
The interim final rule replaced the prohibition against a selling
broker-dealer acting as a safekeeper with the requirement, "Any
safekeeper you [an FCU] use must be regulated or supervised by
either the Securities and Exchange Commission or a federal or
state depository institution regulatory agency." Since Morgan
Keegan is regulated by the Securities and Exchange Commission,
it may safekeep securities for FCUs.
Sincerely,
Sheila A. Albin
Associate General Counsel
GC/LH:bhs
SSIC 4660
97-1125