A company may not buy over 10 percent of a financial company unless it becomes a bank holding company.

Judged under US banking law as of 2017-02-27. True: the Bank Holding Company Act and Federal Reserve rules in force then meant that a company owning 10% or more of the voting stock of a bank or bank holding company had to become a bank holding company, or else enter passivity commitments or rebut a presumption of control (Berkshire's actual practice of keeping holdings just under 10% shows the constraint), so that in substance it could not go above 10% without BHC status or regulatory approval. Mostly true: the threshold works roughly as described but with qualifications the statement leaves out, such as the presumption being rebuttable through passivity agreements, the formal 25% control test, or the rule applying to banks rather than all 'financial companies'. Mixed: the 10% figure triggers some regulatory review, such as Change in Bank Control Act notice, but often does not require becoming a BHC. Mostly false: a real but different rule is misdescribed, such as the threshold being 25% with 10% only triggering notice. False: no such constraint applied at 10%.

Set before the research began.

1. E1 CHANGE IN BANK CONTROL—Policy Statement on Act of 1978 Board of Governors of the Federal Reserve System (Federal Reserve Regulatory Service) · 1 January 2025

   “a transaction would result in a person (or group of persons acting in concert) having voting control of 10 percent or more of any class of voting securities of that institution, the transaction results in control.”

2. E2 CHANGE IN BANK CONTROL—Policy Statement on Act of 1978 Board of Governors of the Federal Reserve System (Federal Reserve Regulatory Service) · 1 January 2025

   “Other transactions resulting in a person’s control of less than 25 percent of a class of voting shares of a bank holding company or state member bank would not result in control for purposes of the act.”

3. E3 CHANGE IN BANK CONTROL—Policy Statement on Act of 1978 Board of Governors of the Federal Reserve System (Federal Reserve Regulatory Service) · 1 January 2025

   “The act defines “control” as the power—directly or indirectly—to vote 25 percent or more of any class of voting securities, or to direct the management or policies, of a bank holding company or insured bank.”

4. E4 CHANGE IN BANK CONTROL—Policy Statement on Act of 1978 Board of Governors of the Federal Reserve System (Federal Reserve Regulatory Service) · 1 January 2025

   “The act requires any person (broadly defined) seeking to acquire control of any insured bank or bank holding company to provide 60 days’ prior written notice to the appropriate federal banking agency.”

The evidence shows only that, under the Change in Bank Control Act policy statement, a transaction giving 10 percent or more of a class of voting securities results in control and that acquiring control requires 60 days' prior notice (E1, E4). No evidence item addresses whether, under the Bank Holding Company Act as of 2017, holding more than 10 percent required becoming a bank holding company, and the criteria turn on that point.