Convergence in the Financial Services Essay Example | Topics and Well Written Essays - 7000 words

Convergence in the Financial service - Essay Examplevertrading and aggressive positions taken by the trading and asset management entities of the fiscal roll up (FC), though accounting for only a segment of the FCs activities and revenues, tends to expose the entire group to noble risks that were not contemplated, particularly by the multitude of individual depositors and consumer loans clientele that are served by the financial mediation function of the group.In Europe, the regulatory instrument governing FCs is the Financial Conglomerate Directive, an act of the European sevens that commands the compliance of banks through the European Union. The Commission has continually conducted consultation sessions and surveys among any and all parties taking cheer in the activities of FCs, including the conglomerates themselves. The latest consultation effort elicited insightful and indepth responses from the various respondents, the result thereof foreground concerns about inequities b etween sectors in an FC that unduly cause competition for capital, confusion in legal structure, problems in the scope of supplementary supervision of unregulated entities, and absence of a level playing field.The first chapter of this harangue introduces the subject of research and the contextual background through which it should be viewed. The framework for discussion is also soon indicated, as well as the issues intended to be analyzed pursuant to the consultative document and feedback responses of the dissimilar subject institutions.Since the Great Depression in the U.S. and for eight years thereafter, the Glass-Steagall Act imposed the firewall between financial institutions involved in banking and those involved in non-banking financial services (Crockett, et al, 2003 Fein, 2001). However, in 1999 the Gramm-Leach-Biley Act was passed repealing Glass-Steagall and thus allowing firms to lease in both bank and non-bank function, due to increasingly persuasive evidence that l iberalizing the