The initiatives of developing larger financial institutions to deal with greater risk of failure has been most evident in the rise of interstate banking in the United States and the emergence of highly service-diversified financial holding companies. The former came partly as a result of the passage of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, while the latter came partly as a result of the passage of the Gramm-Leach-Bliley Financial Services Modernization Act of 1999.

Question

Quizplus · Accepted Answer

The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 allowed banks to operate branches across state lines, facilitating the growth of larger financial institutions. The Gramm-Leach-Bliley Financial Services Modernization Act of 1999 allowed financial institutions to offer a broader range of services, leading to the emergence of diversified financial holding companies, both aiming to manage the risks associated with financial failures more effectively.

The Initiatives of Developing Larger Financial Institutions to Deal with Greater