The Federal Reserve Board wiped Regulation R from its books effective Dec. 6.

The rules have prohibited banks and firms "principally engaged" in securities underwriting and dealing from sharing employees and directors. Reg R, adopted in 1969, interprets section 32 of the Glass-Steagall Act.

In July, the central bank proposed dropping the rules to reduce unnecessary costs and eliminate unwarranted constraints on credit. Experts hailed the plan for clearing a path for banks to put their own representatives on the boards of the mutual funds they operate.

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