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Banking & Other Financial Institutions > Why Are Banks Regulated? > Flashcards

Why Are Banks Regulated? Flashcards

1
Q

Why do banks are regulated

A

(prudential regulations)
- deal with banks’ safety and soundness to prtect depositors’ funds
- economic stability
- concerns social goals

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2
Q

Banks are regulated to reduce the risk of large-scale failures that would adversely affect the level of economic activity

A

Domestic Markets

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3
Q

Corporation chartered by a state to engage in international banking

A

Agreement Corporation

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4
Q

A company that owns and/or controls one or kore U.S. banks that owns, or has controlling interest in, one or more banks

A

Bank Holding Company (BHC)

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5
Q

A financial institution that is owned by stockholders,operates for a profit, and engages in various lending activities

A

Commercial Bank

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6
Q

State-chartered savings asscociations located in Massachsetts, New Hampshire, Rhode Island and Vermont

A

Cooperative Bank

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7
Q

Financial cooperative organization of individuals a common affiliation

A

Credit Union

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8
Q

Entities primarily engaged in providing infrastructure for hosting or data processing services

A

Data Processing Servicer

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9
Q

A branch that resides in the United States, and whose parent is also located in United States

A

Domestic Branch of Domestic Bank

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10
Q

Domestic institurions that engage in banking activities usually in connection with the business of banking in United States

A

Domestic Entity Other

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11
Q

An organizatio charted by the Federal Reserve to engage in international banking and financial operations.

A

Edge/Agreement Corporation

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12
Q

Financial intermediary that makes loans to individuals or businesses.

A

Finance Company

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13
Q

A finance entity engaged in a broad range of banking-related activities, created by Gramm-Leach-Bliley Act of 1999.

A

Finance Holding Company

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14
Q

Refers to any U.S. operation of a banking organization headquartered outside the United States

A

Foreign Bank

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15
Q

Can acquire or establish freestanding banks or bank holding companies in United states

A

Foreign Banking Organization (FBO)

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16
Q

A foreign banking organization that is owned or controlled by a BHC

A

Foreign Banking Organization of a BHC

17
Q

A foreign banking organization that is also acts as a BHC and is thus supervised by the Board of Governors of the Federal Reserve

A

Foreign Banking Orhanization as a BHC

18
Q

A branch thag resides outside the United States but has a parent that is located in the US

A

Foreign Branch of a US Bank

19
Q

Foreign institutions that engage in banking activities usually in conenction with the business of banking in the countries where such foreign institutions are ofganized or operating.

A

Foreign Entity Other

20
Q

A limited service fianncial institution that raises funds by selling certificates call investment shares and by accepting deposits

A

Industrial Bank

21
Q

Provides compensation based on the happening of one or
more contingencies.

A

Insurance Company

22
Q

An insured branch accepts retail
deposits and must apply for federal deposit insurance.

A

Insured Branch of an FBO (Federal and State)

23
Q

Acts as underwriter or agent that serves as intermediary between issuer of securities and the investing public.

A

Investment Bank/Company

24
Q

A bank that is a member of the Federal Reserve System, including
all nationally chartered banks and any state-chartered or mutual savings banks that
apply for membership and are accepted.

A

Member Bank

25
Q

A financial institution that accepts deposits primarily from
individuals and places a large portion of its funds into mortgage loans.

A

Mutual Savings Bank

26
Q

A commercial bank whose charter is approved by the OCC rather
than by a state banking department.

A

National Bank

27
Q

This subset includes all commercial banks that are state-chartered and are NOT members of the Federal Reserve System.

A

Non-Member Banks

28
Q

Accepts and executes trusts but does not issue currency

A

Non-Depository Trust Company

29
Q

Those financial institutions, not specifically listed, with authority to accept deposits of funds.

A

Other Depository Institution

30
Q

Companies not specifically listed, but in which there is regulatory interest that are not authorized to accept deposits.

A

Other Non-Depository Institution

31
Q

A financial institution that accepts deposits primarily from individuals and channels its funds primarily into residential mortgage loans.

A

Savings and Loan Association

32
Q

Banking institution organized to encourage thrift by paying interest
dividends on savings.

A

Savings Bank

33
Q

Entities primarily engaged in acting as agents (i.e., brokers) between buyers and sellers in buying or selling securities on a commission
or transaction fee basis.

A

Securities Broker/Dealer

34
Q

This subset includes all commercial banks that are state-chartered and members of the Federal Reserve System.

A

State Member Banks

35
Q

An organization that primarily accepts savings account deposits and invests most of the proceeds in mortgages.

A

Thrifts

36
Q

An uninsured agency does not
accept retail deposits and need not apply for federal deposit insurance.

A

Uninsured Agency of an FBO (Federal and State)

37
Q

An uninsured branch does not
accept retail deposits and need not apply for federal deposit insurance.

A

Uninsured Branch of an FBO (Federal and State)

38
Q

U.S. branches and agencies of foreign banks
are entities contained within and controlled by a foreign banking organization.

A

U.S. Branches and Agencies of FBOs

39
Q

occurs when bank failures are potentially contagious, and only then if the losses in one bank cascade into other banks or to other economies through-out the world.

A

Systemic Risk

Banking & Other Financial Institutions (7 decks)

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