NEW YORK (
) -- One the largest U.S. investment funds has won regulatory approval to offer retail banking services.
The Office of Thrift Supervision (OTS)
to begin selling consumer bank products such as deposits accounts and loans. The filing also said that the $400 billion fund will now be able to originate mortgages as well as invest in mortgage-backed securities through its bank subsidiary.
Prior to regulatory approval, TIAA was limited to providing trust services to investment management clients which includes educators and others in the non-profit community. But with the OTS blessing now in hand, the fund will also be able to offer a wider array of banking services to the "general public."
"Getting this approval was an important part of the expansion we want to provide our clients," said a TIAA-CREF spokesman. As a result of the change TIAA will also begin offering trust clients money market deposit accounts backed by the
Federal Deposit Insurance Corp
. He added that other services may be added, but, "they remain to be determined."
TIAA-CREF filed its application to expand its services on Sept. 1, 2009, according to the OTS.
TIAA created its savings bank in 1998 when several non-traditional banks applied for thrift charters. At that time companies such as
gained thrift charters as a way to offer bank services without becoming fully regulated commercial banks.
Written by Maria Woehr in New York