Holding Company Law and Legal Definition

A holding company is a company, usually a corporation, which is created to own the stock of other corporations, often using the stock holdings to control the management and policies of all of them. The Federal Deposit Insurance Corporation (FDIC) regulates bank holding companies. Under the regulations of the FDIC, a company is a bank holding company when:

  1. the company directly or indirectly or acting through one or more other persons owns, controls, or has power to vote 25 percent or more of any class of voting securities of the bank or company;
  2. the company controls in any manner the election of a majority of the directors or trustees of the bank or company; or
  3. the Board determines, after notice and opportunity for hearing, that the company directly or indirectly exercises a controlling influence over the management or policies of the bank or company.