Banking system in usa

Regulation of the banks

Banking regulation

Rederal State governments

• The 5 largest banks in the US at December 31,2011 were:• JPMargon Chase• Bank of America• Citigroup• Wells Fargo• Goldman Saches

• In december 2011, the 5 largest banks` assets were equal to 56% of the US economy, compared with 43% 5 years ago.

In New York City

• Salary in finance industry rose from $80.000 in 1981 to $360.000 in 2011,

• While average New York City salaries rose from $ 40.000 to $70.000

• In 1988 ther were about 12.500 US banks with less than $300mln in deposit , and about 900 with more deposits,

• But by 2012 the were only 4.200 banks with less than $ 300mln in deposit in the US, and over 1.800 with more

Federal Reserve system

• The central banking system of the US, called The Federal Reserve system, was created in 1913 by the enactment of the Federal Reserve Act

Duties of the FRS

• To conduct the nation`s monetery policy;• Supervise and regulate banking institutions;• To provide financial services to depository institutions: US

government, foreign official institutions;

Profit transfer of the FRS

• The US Government receive annual profits, all of the system`s annual profits, after a statutory dividend of 6% on member banks` capital investment is paid and an account surplus is maintained.

• In 2010, the Federal Reserve made a profit of 482bln and transferred $78bln to the US Treasure

The Federal Reserve board is headquartered in Washington DC. The Board Consists of 7 “Governors” appointed by the President and confirmed by the Senate for 14 Year Non-Renewable terms

Alan Greenspan

(1992)

Roger Ferguson

(2001)

Edward Gramlich

(1997)

Susan Bies

(2001)

Mark Olsen

(2001)

Ben Bernanke

(2003)

Donald Kohn

(2002)

Federal Deposit Insurance Corporation (RDIC)• FDIC is a US government corporation• It provides depositbinsurance, which guarantees the safety of

deposits in member banks• Up to $250.000 per depositor per bank• November 18,2010, the FDIC insures deposits at 7.723 institutions;

• “ All commercial banks accepting deposits must be FDIC insured”

the FDIC Investment Act in 1989

• In August 22, 2008 were insure 8.430 commercial banks by FDIC;• US banks are not allowed to go bankrupt, accounts are insured up to

$250.000 by FDIC (per bank)

The End