Umbrella Supervision and the Role of the Central Bank

FRB of Cleveland Policy Discussion Paper No. 11

13 Pages Posted: 22 Jan 2006

See all articles by Joseph G. Haubrich

Joseph G. Haubrich

Federal Reserve Bank of Cleveland

James B. Thomson

University of Akron

Date Written: December 2005

Abstract

Deregulation and financial consolidation have led to the development of financial holding companies - allowing commercial banking, insurance, investment banking, and other financial activities to be conducted under the same corporate umbrella - and the Federal Reserve has been named supervisor of the consolidated enterprise. This Policy Discussion Paper will show that there likely are economies of scope between the Fed's inherent central-banking responsibilities and those of an umbrella supervisor and that these duel roles benefit both the Fed and functional regulators.

Keywords: umbrella supervision, deregulation, financial consolidation

JEL Classification: G18, G21, G28

Suggested Citation

Haubrich, Joseph G. and Thomson, James B., Umbrella Supervision and the Role of the Central Bank (December 2005). FRB of Cleveland Policy Discussion Paper No. 11. Available at SSRN: https://ssrn.com/abstract=876979 or http://dx.doi.org/10.2139/ssrn.876979

Joseph G. Haubrich (Contact Author)

Federal Reserve Bank of Cleveland ( email )

East 6th & Superior
Cleveland, OH 44101-1387
United States
216-579-2802 (Phone)
216-579-3050 (Fax)

James B. Thomson

University of Akron ( email )

Akron, OH 44325-4803
United States

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