Banking Regulation in the United States - 3rd Edition - Hardcover
Banking Regulation in the United States - 3rd Edition - Electronic
Types of Bank Charters and
the Tangle of Regulation
A. The Four Major Types of Banks
One must first understand what a bank is before attempting to
understand the complex bank regulatory system. Given the variety
of financial institutions that pepper the United States, it is not
possible to define a bank in any generally acceptable way. The
following definition appears in the Uniform Commercial Code, the
major set of commercial laws adopted throughout the United States:
“Bank” means any person engaged in the business of banking,
including a savings bank, savings and loan association, credit
union or trust company.1
And this is by the best legal/financial brains in the country. Here’s
From an economic perspective, a bank is any institution that
offers people liquidity—the ability to convert their assets into
cash on short notice—while still using their money to make longterm
This may be less than helpful for present purposes.
CHAPTER I-Types of Bank Charters and the Tangle of Regulation
A. The Four Major Types of Banks
B. Commercial Banks
1. National Banks: The Comptroller of the Currency
2. State Banks: State Banking Departments
3. Member Banks: The Federal Reserve System
4. Nonmember State Banks - The Federal Deposit Insurance Corporation
5. The Historic Roots of the Bank Regulatory Structure
6. Commercial Banks in General: Summary
C. Savings Banks
D. Savings and Loan Associations
1. Aborted End of the Thrift System
E. Credit Unions
F. Holding Companies
G. Functional Regulation of Securities and
H. The Special Value of a Bank Charter
1. The Creation of Money
2. "Convenience and Needs" and the Community Reinvestment Act
I. Bank Powers: The Business of Banking
1. "The Business of Banking"
4. Synthesis: the VALIC Case
Carl Felsenfeld is Professor of Law, Fordham University School of Law, and Former Vice President & Senior Attorney for Consumer and Commercial Financial Activities, Citicorp.
Professor Felsenfeld was a charter member of the Federal Reserve Consumer Advisory Council, Chairman of the American Bar Association Committee on Consumer Financial Services, Advisor to the Commissioners on Uniform State Laws in their project to write an EFI law (Article 4A of the UCC) and a representative to the United Nations Commission on International Trade Law (EFT Model Law and International Insolvency Model Law).
David L. Glass serves as Head of Risk Management Group Legal Affairs for the Americas for the Macquarie Group, a diversified financial services company based in Sydney, Australia. He is also Counsel in the New York office of Arent Fox LLP, where he works in the finance group. He is experienced in advising clients in all aspects of banking and financial regulation. With the Macquarie Group, Mr. Glass advises management regarding the structuring of the Group's US activities and oversees the regulatory relationships of its regulated entities in the United States. David also serves as the Group's anti-money laundering (AML) officer for the Americas and as Director of Compliance for its SEC-registered broker dealer subsidiary.
Prior to working at Macquarie and Arent Fox, Mr. Glass was General Counsel of the New York Bankers Association and practiced with Clifford Chance and Debevoise & Plimpton. He began his career at the Federal Reserve Bank of New York, where at various times he served as a staff attorney, Chief of the Credit Analysis Division, and Assistant to the President. He is currently an adjunct professor of law at New York Law School and Pace University School of Law, where he has taught banking, international banking, payment systems and administrative law. In 2009 he was appointed associate director of New York Law School's newly established Center for Financial Services Law; in this capacity he is assisting in the development of courses and faculty for the school's newly accredited LLM degree in financial services law. Mr. Glass served as Chair of the New York State Bar Association's Business Law Section, and is currently Chair of the Association's Banking Law Committee. He is also a member of the Banking Law Committee of the Association of the Bar of the City of New York and the Panel of Commercial Arbitrators of the American Arbitration Association.