NEW YORK (
) -- One the largest U.S. investment funds has won regulatory approval to offer retail banking services.
The Office of Thrift Supervision (OTS)
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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