[ Pobierz całość w formacie PDF ]
.Additionally, regulators estimated that 40 percent of thriftfailures were attributable to fraud or insider abuse.[41]FIRREA s passage resulted in a number of important changes to the regulatory,chartering, and deposit insurance regime governing the thrift industry.Specifically,FIRREA terminated the FSLIC and the FHLBB; established the Office of ThriftSupervision ( OTS ) as a new office in the Department of the Treasury ( Treasury ) tocharter and oversee thrift holding companies and thrifts; formed and capitalized theSavings Association Insurance Fund ( SAIF ) within the FDIC to replace FSLIC sinsurance fund; established the Federal Housing Finance Board to regulate the FHLBSystem; and incorporated and funded the Resolution Trust Corporation to manage failed bankand thrift assets.FIRREA also added two directorships to the FDIC Board of Directors,with one automatically held by the new OTS Director.In the wake of FIRREA, the OTS, an office in Treasury modeled after the Office of theComptroller of the Currency ( OCC ), now regulated thrifts.Furthermore, the FDIC, 76 Martin T.Bannister (Editor)historically the insurer and back-up bank supervisor, was now performing those samefunctions for thrifts.[42] Thus, FIRREA represented another legislative action in whichCongress determined it to be good public policy to continue to eliminate previouslysignificant distinctions between banking and thrift institutions.Additional Changes from the 1990s to the PresentIn 1991 the Federal Deposit Insurance Corporation Improvements Act ( FDICIA )substantially changed the way in which depository institution regulators must supervise theirregulated institutions.In large measure Congress enacted FDICIA as a response to theprevailing opinion that regulatory forbearance was one of the key policyunderpinnings of the resulting bank and thrift failures of the late 1980s and early 1990s.[43] InFDICIA, Congress established a system of capital-based prompt corrective action( PCA ).[44] FDICIA also ordered federal regulators to implement risk-based capitalmeasures.These changes, along with other provisions, led to greater convergence offederal bank and thrift charters.As a result, both charters were now subject to capital- basedPCA and risk-based capital requirements.As capital is a major driver of financial institutionoperations, FDICIA eliminated any significant charter arbitrage opportunities in the areas ofcapital requirements or potential regulatory forbearance.While thrifts had enjoyed liberalized interstate branching privileges since the passage ofHOLA, federally regulated banks were strictly limited in their ability to branch across statelines.[45] In 1994, Congress passed the Riegle-Neal Interstate Banking and Branching EfficiencyAct ( Riegle-Neal Act ), further eroding differences between bank and thrift branchingflexibility.The Gramm-Leach-Bliley Act of 1999 ( GLB Act ) received a great deal of attentionbecause of its repeal of provisions of the Glass-Steagall Act of 1933 which had mandated theseparation of commercial and investment banking activities.One of the GLB Act s keyprovisions established a financial holding company ( FHC ) structure as a vehicle to allowaffiliations among banks, securities firms, and insurers.More specific to thrifts, the GLB Act changed the landscape for thrift holding companies.Prior to the GLB Act, unitary thrift holding companies owning a single thrift institution wereallowed to affiliate with commercial entities, despite the general overall policy frameworkprohibiting any linkages between banking and commerce.The GLB Act eliminated theability of non-grandfathered unitary thrift holding companies[46] to affiliate with commercialentities, one of the major remaining distinctions between the bank and thrift charters.Prior tothe GLB Act the non-bank affiliates of bank holding companies ( BHCs ) could only engagein activities that the Federal Reserve deemed closely related to banking.After the passage ofthe GLB Act, no commercial entity could acquire a federally chartered depositoryinstitution.The Federal Deposit Insurance Reform Act of 2005 ( FDIR Act ) made significantchanges to the deposit insurance regime for banks and thrifts.Arguably the mostimportant change was the legislation s merging of the Bank Insurance Fund ( BIF ) and theSAIF into one single fund, the Deposit Insurance Fund.As a result, both banks and thrifts,regardless of which type of institution is responsible for the loss, bear indirectly any lossestriggering FDIC payments.In light of this change, the FDIR Act s joining of the deposit Intermediate-Term Recommendations 77insurance mechanisms for banks and thrifts represents one more significant reduction in thedifferences between the bank and thrift charters.However, bifurcation of the safety andsoundness oversight of the charters remains.Remaining Comparative Advantage of the Thrift CharterHistorically, banking institutions have not generally been subject to either a forcedorientation toward a particular area of lending, such as real estate financing, or to specific asset-type lending constraints.In contrast, thrifts are subject to several specific lending constraints,including asset concentration limits on nonresidential real estate loans, commercial loans,and unsecured residential construction loans.However, as long as thrift institutionscontinue to meet the QTL test,[47] thrifts continue to maintain some limited competitiveadvantages vis-à-vis their banking competitors.Branching RightsThe federal thrift charter confers the broadest geographic expansion authority of anyfederally insured depository institution charter.Despite the fact that the Riegle-Neal Actreduced much of thrifts historical branching advantages, some states still subject banks toa limited range of restrictions on their statewide branching authority.Service Corporation ActivitiesFederally chartered thrifts may invest up to three percent of their assets in servicecorporations.Major activities permissible for service corporations, but not currently fornational banks, include real estate development activities[48] and real estate managementfor third parties.Thrift Holding Company ActivitiesThe Savings and Loan Holding Company ( SLHC ) Act, administered by the OTS,subjects thrift holding companies to regulation similar to that of BHCs but with severalimportant distinctions.The OTS has authority to deal with any activity of a thrift holdingcompany posing a serious risk to the safety, soundness, or stability of the holdingcompany s subsidiary thrifts.Thrift holding companies with multiple thrifts are subject tostrict limitations on activities, but there are no permissible activities or ownership structurerestrictions on unitary thrift holding companies whose thrifts meet a housing- related QTLtest.However, as noted above, the GLB Act mandated regulating new unitary thriftholding companies as multiple thrift holding companies and generally permitted newunitary thrift holding companies to engage in activities permissible for FHCs, with certainlimited grandfathered exceptions [ Pobierz caÅ‚ość w formacie PDF ]
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.Additionally, regulators estimated that 40 percent of thriftfailures were attributable to fraud or insider abuse.[41]FIRREA s passage resulted in a number of important changes to the regulatory,chartering, and deposit insurance regime governing the thrift industry.Specifically,FIRREA terminated the FSLIC and the FHLBB; established the Office of ThriftSupervision ( OTS ) as a new office in the Department of the Treasury ( Treasury ) tocharter and oversee thrift holding companies and thrifts; formed and capitalized theSavings Association Insurance Fund ( SAIF ) within the FDIC to replace FSLIC sinsurance fund; established the Federal Housing Finance Board to regulate the FHLBSystem; and incorporated and funded the Resolution Trust Corporation to manage failed bankand thrift assets.FIRREA also added two directorships to the FDIC Board of Directors,with one automatically held by the new OTS Director.In the wake of FIRREA, the OTS, an office in Treasury modeled after the Office of theComptroller of the Currency ( OCC ), now regulated thrifts.Furthermore, the FDIC, 76 Martin T.Bannister (Editor)historically the insurer and back-up bank supervisor, was now performing those samefunctions for thrifts.[42] Thus, FIRREA represented another legislative action in whichCongress determined it to be good public policy to continue to eliminate previouslysignificant distinctions between banking and thrift institutions.Additional Changes from the 1990s to the PresentIn 1991 the Federal Deposit Insurance Corporation Improvements Act ( FDICIA )substantially changed the way in which depository institution regulators must supervise theirregulated institutions.In large measure Congress enacted FDICIA as a response to theprevailing opinion that regulatory forbearance was one of the key policyunderpinnings of the resulting bank and thrift failures of the late 1980s and early 1990s.[43] InFDICIA, Congress established a system of capital-based prompt corrective action( PCA ).[44] FDICIA also ordered federal regulators to implement risk-based capitalmeasures.These changes, along with other provisions, led to greater convergence offederal bank and thrift charters.As a result, both charters were now subject to capital- basedPCA and risk-based capital requirements.As capital is a major driver of financial institutionoperations, FDICIA eliminated any significant charter arbitrage opportunities in the areas ofcapital requirements or potential regulatory forbearance.While thrifts had enjoyed liberalized interstate branching privileges since the passage ofHOLA, federally regulated banks were strictly limited in their ability to branch across statelines.[45] In 1994, Congress passed the Riegle-Neal Interstate Banking and Branching EfficiencyAct ( Riegle-Neal Act ), further eroding differences between bank and thrift branchingflexibility.The Gramm-Leach-Bliley Act of 1999 ( GLB Act ) received a great deal of attentionbecause of its repeal of provisions of the Glass-Steagall Act of 1933 which had mandated theseparation of commercial and investment banking activities.One of the GLB Act s keyprovisions established a financial holding company ( FHC ) structure as a vehicle to allowaffiliations among banks, securities firms, and insurers.More specific to thrifts, the GLB Act changed the landscape for thrift holding companies.Prior to the GLB Act, unitary thrift holding companies owning a single thrift institution wereallowed to affiliate with commercial entities, despite the general overall policy frameworkprohibiting any linkages between banking and commerce.The GLB Act eliminated theability of non-grandfathered unitary thrift holding companies[46] to affiliate with commercialentities, one of the major remaining distinctions between the bank and thrift charters.Prior tothe GLB Act the non-bank affiliates of bank holding companies ( BHCs ) could only engagein activities that the Federal Reserve deemed closely related to banking.After the passage ofthe GLB Act, no commercial entity could acquire a federally chartered depositoryinstitution.The Federal Deposit Insurance Reform Act of 2005 ( FDIR Act ) made significantchanges to the deposit insurance regime for banks and thrifts.Arguably the mostimportant change was the legislation s merging of the Bank Insurance Fund ( BIF ) and theSAIF into one single fund, the Deposit Insurance Fund.As a result, both banks and thrifts,regardless of which type of institution is responsible for the loss, bear indirectly any lossestriggering FDIC payments.In light of this change, the FDIR Act s joining of the deposit Intermediate-Term Recommendations 77insurance mechanisms for banks and thrifts represents one more significant reduction in thedifferences between the bank and thrift charters.However, bifurcation of the safety andsoundness oversight of the charters remains.Remaining Comparative Advantage of the Thrift CharterHistorically, banking institutions have not generally been subject to either a forcedorientation toward a particular area of lending, such as real estate financing, or to specific asset-type lending constraints.In contrast, thrifts are subject to several specific lending constraints,including asset concentration limits on nonresidential real estate loans, commercial loans,and unsecured residential construction loans.However, as long as thrift institutionscontinue to meet the QTL test,[47] thrifts continue to maintain some limited competitiveadvantages vis-à-vis their banking competitors.Branching RightsThe federal thrift charter confers the broadest geographic expansion authority of anyfederally insured depository institution charter.Despite the fact that the Riegle-Neal Actreduced much of thrifts historical branching advantages, some states still subject banks toa limited range of restrictions on their statewide branching authority.Service Corporation ActivitiesFederally chartered thrifts may invest up to three percent of their assets in servicecorporations.Major activities permissible for service corporations, but not currently fornational banks, include real estate development activities[48] and real estate managementfor third parties.Thrift Holding Company ActivitiesThe Savings and Loan Holding Company ( SLHC ) Act, administered by the OTS,subjects thrift holding companies to regulation similar to that of BHCs but with severalimportant distinctions.The OTS has authority to deal with any activity of a thrift holdingcompany posing a serious risk to the safety, soundness, or stability of the holdingcompany s subsidiary thrifts.Thrift holding companies with multiple thrifts are subject tostrict limitations on activities, but there are no permissible activities or ownership structurerestrictions on unitary thrift holding companies whose thrifts meet a housing- related QTLtest.However, as noted above, the GLB Act mandated regulating new unitary thriftholding companies as multiple thrift holding companies and generally permitted newunitary thrift holding companies to engage in activities permissible for FHCs, with certainlimited grandfathered exceptions [ Pobierz caÅ‚ość w formacie PDF ]