Banking in The United States - Regulatory Agencies

Regulatory Agencies

Bank regulation in the United States is highly fragmented compared with other G10 countries. While most of these countries have only one bank regulator, in the U.S., banking is regulated at both the federal and state level. Depending on its type of charter and organizational structure, a banking organization may be subject to numerous federal and state banking regulations. Unlike Japan and the United Kingdom (where regulatory authority over the banking, securities and insurance industries is combined into one single financial-service agency), the U.S. maintains separate securities, commodities, and insurance regulatory agencies—separate from the bank regulatory agencies—at the federal and state level.

U.S. banking regulation addresses privacy, disclosure, fraud prevention, anti-money laundering, anti-terrorism, anti-usury lending, and the promotion of lending to lower-income populations. Some individual cities also enact their own financial regulation laws (for example, defining what constitutes usurious lending).

Since the enactment of the Federal Deposit Insurance Corporation Improvement Act of 1989 (FDICIA), all commercial banks that accept deposits are required to obtain FDIC insurance and to have a primary federal regulator (the Fed for state banks that are members of the Federal Reserve System, the FDIC for "nonmember" state banks, and the Office of the Comptroller of the Currency for all National Banks).

Federal credit unions are regulated by National Credit Union Administration (NCUA); Savings & Loan Associations (S&L) and Federal savings banks (FSB) are regulated by the Office of Thrift Supervision (OTS).