Umbrella Supervision and the Role of the Central Bank
FRB of Cleveland Policy Discussion Paper No. 11
13 Pages Posted: 22 Jan 2006
Date Written: December 2005
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: Suggested Citation