A New Look at the Performance of Industrial Loan Companies and Their Contribution to the US Banking System

61 Pages Posted: 20 Jun 2018 Last revised: 5 Dec 2018

See all articles by James R. Barth

James R. Barth

Auburn University; Milken Institute

Yanfei Sun

Ryerson University

Date Written: June 15, 2018

Abstract

In this paper, we examine the differences between commercially-owned ILCs and those owned by financial firms, and offer a current assessment of ILC performance, paying particular attention to commercially-owned ILCs, and their contribution to the US banking system. The rules governing their oversight, especially relative to bank regulation, occupy a significant part of this evaluation as we consider why the ILC ownership concept causes a stir when they’re subject to the same FDIC regulation as any other banking institution. Most important, we look at the capitalization and performance of ILCs over the past few decades relative to the banking industry more generally. And because all ILCs are state-chartered, we specifically compare their size and performance to other state-chartered banks.

Keywords: ILC, Banks, Regulation

Suggested Citation

Barth, James R. and Sun, Yanfei, A New Look at the Performance of Industrial Loan Companies and Their Contribution to the US Banking System (June 15, 2018). Available at SSRN: https://ssrn.com/abstract=3197316 or http://dx.doi.org/10.2139/ssrn.3197316

James R. Barth (Contact Author)

Auburn University ( email )

415 West Magnolia Avenue
Auburn, AL 36849
United States
334-844-2469 (Phone)
334-844-4960 (Fax)

Milken Institute ( email )

1250 Fourth Street
Santa Monica, CA 90401
United States

Yanfei Sun

Ryerson University

350 Victoria Street
Toronto, Ontario M5B 2K3
Canada

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