2002 Articles

Banking Approaches the Modern Era

Calomiris, Charles W.

The past two decades have seen a radical transformation of regulation controlling the size, location, and activities of U.S banks. Included in those changes are state-level reforms of branching barriers, relaxation of deposit interest rate ceilings, the passage of a nationwide bank-branching law in 1994, and the expansion of bank powers throughout the 1980s and 1990s. The reforms culminated in the passage of the Gramm-Leach-Bliley Act of 1999, which established financial holding companies-an alternative to more limited bank holding companies- as a platform for building the global, universal U.S. banks for the next generation.