Updated from Sunday, Sept. 21
The Federal Reserve Sunday announced that Goldman Sachs(GS Quote) and Morgan Stanley(MS Quote) would transform themselves from investment banks into traditional bank holding companies.
The Fed's announcement comes after a stunning week in which a financial cataclysm changed the landscape of Wall Street, making large, independent investment banks an endangered species. The crisis forced the closing of Lehman Brothers and the sale of Merrill Lynch(MER Quote) to Bank of America(BAC Quote), and sent Morgan Stanley scrambling to find a partner.
By becoming bank holding companies, Morgan Stanley and Goldman will come under the scrutiny of national banking regulators and will be subject to new capital requirements, The Wall Street Journal noted. ...
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