Fin 346 Commercial Banking

Homework
Chapter 2 HW # 3 Slides 26-30
Name: _____Timothy Hart______ Date: ______1/29/2020_________
1-Who regulates S&L’s?
State-chartered associations- supervised by state boards
Federally chartered savings associations- fall under the Office of the Comptroller of the
Currency

2-What are money market funds, are they insured and who regulates them?
Money market funds are mutual funds.
They are not insured by the FDIC.
They are regulated by the Securities & Exchange Commission (SEC).

3-Who regulates insurance companies? What if they own commercial banks?

Regulated by state insurance commissions.
When they own commercial banks they may come under the Federal Reserve's review.

4-Who regulates finance companies and what problem do they pose?

They are both self-regulated & regulated by state governments.
There are still serious concerns about inadequate regulation.

5-What are the 3 levels of regulation for investment banks and security dealers? What 3
activities are these firms involved in? What 2 things does the SEC focus on?
A combination of federal and state supervision applies to these companies that buy and
sell (trade) securities, underwrite new security issues & give financial advice. The chief
federal regulator is the SEC. It requires these firms to submit periodic reports, limits the
leverage they have, & investigates insider trading. These firms are also self-regulated by
member firms.

6-Who oversees hedge funds, venture capital funds and private equity funds? What is the
concern about them and what does Dodd Frank do about them?
Regulated by the SEC.
Some of the most lightly regulated of all financial institutions.The SEC has broad oversight
of the information these firms provide to the public when they choose to sell securities in
the open market that are accessible to small investors.
7-List 3 big challenges regulators face:
1. What should we do about deposit insurance?
2. Can we keep regulators up-to-date in a complex financial market?
3. With the financial-services industry consolidating into fewer, but bigger, firms, can we
get by with fewer regulators?
4. How do we manage systemic risk?
5. Can we simplify the current regulatory structure and bring greater efficiency to the task?
6. As financial firms expand around the globe, how should regulators coordinate their
activities so that potentially destabilizing activities do not slip by unnoticed?