Historical development of the banking system, financial innovation and the growth of the shadow banking system, structure of the . commercial banking industry, bank consolidation and separation of the banking, international banking,. is the main content of the lecture "Banking Industry: Structure and Competition". Invite you to consult the detailed content lectures to capture details. | Banking Industry: Structure and Competition Contents Historical Development of the Banking System Financial Innovation and the Growth of the “Shadow Banking System” Structure of the . Commercial Banking Industry Bank Consolidation and Separation of the Banking Thrift Industry: Regulation and Structure International Banking Historical Development of the Banking System Bank of North America chartered in 1782 Controversy over the chartering of banks. National Bank Act of 1863 creates a new banking system of federally chartered banks Office of the Comptroller of the Currency Dual banking system Federal Reserve System is created in 1913. Figure 1 Time Line of the Early History of Commercial Banking in the United States Primary Supervisory Responsibility of Bank Regulatory Agencies Federal Reserve and state banking authorities: state banks that are members of the Federal Reserve System. Fed also regulates bank holding companies. FDIC: insured state banks that are not Fed members. State banking authorities: state banks without FDIC insurance. Financial Innovation and the Growth of the “Shadow Banking System” Financial innovation is driven by the desire to earn profits A change in the financial environment will stimulate a search by financial institutions for innovations that are likely to be profitable Financial engineering Responses to Changes in Demand Conditions: Interest Rate Volatility Adjustable-rate mortgages Flexible interest rates keep profits high when rates rise Lower initial interest rates make them attractive to home buyers Financial Derivatives Ability to hedge interest rate risk Payoffs are linked to previously issued (. derived from) securities. Responses to Changes in Supply Conditions: Information Technology Bank credit and debit cards Improved computer technology lowers transaction costs Electronic banking ATM, home banking, ABM and virtual banking Junk bonds Commercial paper market Responses to Changes in Supply | Banking Industry: Structure and Competition Contents Historical Development of the Banking System Financial Innovation and the Growth of the “Shadow Banking System” Structure of the . Commercial Banking Industry Bank Consolidation and Separation of the Banking Thrift Industry: Regulation and Structure International Banking Historical Development of the Banking System Bank of North America chartered in 1782 Controversy over the chartering of banks. National Bank Act of 1863 creates a new banking system of federally chartered banks Office of the Comptroller of the Currency Dual banking system Federal Reserve System is created in 1913. Figure 1 Time Line of the Early History of Commercial Banking in the United States Primary Supervisory Responsibility of Bank Regulatory Agencies Federal Reserve and state banking authorities: state banks that are members of the Federal Reserve System. Fed also regulates bank holding companies. FDIC: insured state banks that are not .
