The Federal Reserve System is one of several banking regulatory authorities. The Federal Reserve regulates state-chartered member banks, bank holding companies, foreign branches of U.S. national and state member banks, Edge Act Corporations, and state-chartered U.S. branches and agencies of foreign banks. National banks must be members of the Federal Reserve System; however, they are regulated by the Office of the Comptroller of the Currency (OCC).
The Federal Reserve supervises and regulates many large banking institutions because it is the federal regulator for bank holding companies (BHCs). A listing of the Top 50 BHCs is available online through the Federal Reserve System’s National Information Center. In addition, under the Gramm-Leach-Bliley Act of 1999, the Federal Reserve has the authority to regulate financial holding companies.
Complex U.S. Banking and Regulatory System
At the federal level, there are five financial industry regulators:
At the state level, each state has an agency or agencies that are charged with supervising and regulating state-chartered banks and thrifts. For example, in California, financial institutions are regulated by:
A listing of state bank supervisors for all states is available at:
These federal and state banking regulators have oversight over a wide array of banking institutions and activities. If you are interested in an overview of the regulatory authority for a specific type of banking institution by key types of regulatory activities, let me recommend the Federal Reserve Bank of New York’s online matrix of Banking Institutions and Their Regulators. This publication allows you to view a list of banking institutions and see their primary regulator(s) for several types of regulatory activities:
Selected Banking Institutions:
Selected Regulatory Activities:
NOTE: For information on regulatory changes arising from the 2010 Financial Regulatory Reforms (Dodd-Frank) please see the following:
Financial Regulatory Reform
Ask Dr. Econ (October 2003)
Conference of State Bank Supervisors State Banking Department
Federal Reserve Bank of New York (2003). Banking Institutions and Their Regulators.
Furlong, Fred. (2000) “The Gramm-Leach-Bliley Act and Financial Integration.” FRBSF Economic Letter, Federal Reserve Bank of San Francisco, 2000-10, March 31, 2000.
Harshman, Ellen, Fred C. Yeager, and Timothy J. Yeager. (2005) “The Door Is Open, but Banks Are Slow To Enter Insurance and Investment Arenas.” The Regional Economist, Federal Reserve Bank of St. Louis, October 2005.
A company that controls one or more U.S. banks. A bank holding company may also own another bank holding company, which in turn controls a bank. The company at the top of the ownership chain is called the top holder. The Board of Governors is responsible for regulating and supervising bank holding companies, even if the bank controlled by the holding company is under the primary supervision of a different federal agency (OCC or FDIC).
A financial institution that engages in various financial services, such as accepting deposits and making loans. Includes the following Institution Types:
A state savings association that is organized and operates according to the laws of the state in which it is chartered or organized.
A financial cooperative association organized for the purpose of promoting thrift among its members and creating a source of credit for provident or productive purposes. Credit unions can have federal, state, or corporate affiliations. Includes the following Institution Types:
An Edge corporation is chartered by the Federal Reserve Board to engage in international banking and financial operations and can be broken into domestic branches, banking institutions, or investment institutions. Likewise,an Agreement corporation is chartered by a state to engage in international banking; so named because the corporation enters into an agreement with the Federal Reserve Board that will limit its activities to those permitted. Includes the following Institution Types:
Any Federally chartered financial institution that is supervised, examined, and regulated by the Farm Credit Administration and operates in accordance with the Farm Credit Act of 1971, as amended (12 U.S.C. 2001 et seq). All Farm Credit System institutions are federally-chartered instrumentalities of the United States. Includes the following Institution Type:
Financial Holding Companies
A financial entity engaged in a broad range of financial-related activities, created by the Gramm-Leach-Bliley Act of 2000. These activities include: insurance underwriting, securities dealing and underwriting, financial and investment advisory services, merchant banking, issuing or selling securitized interests in bank-eligible assets, and generally engaging in any non-banking activity authorized by the Bank Holding Company Act. The Federal Reserve Board is responsible for supervising the financial condition and activities of financial holding companies. Similarly, any non-bank commercial company that is predominantly engaged in financial activities, earning 85% or more of its gross revenues from financial services, may choose to become a financial holding company. These companies are required to sell any non-financial (commercial) businesses within ten years. Includes the following Institution Types:
A limited service financial institution that raises funds by selling certificates, called "investment shares," and by accepting deposits. Often called Morris Plan banks or industrial loan companies. Industrial banks are distinguished from commercial loan companies because industrial banks accept deposits in addition to making consumer and commercial loans. Industrial banks differ from commercial banks because some do not offer demand deposit (checking) accounts. Industrial banks are FDIC-supervised financial institutions and are currently chartered in seven states (California, Colorado, Hawaii, Indiana, Minnesota, Nevada and Utah). This group includes the following Institution Type:
Insurance Company Brokers/Agents/Underwriters
A company licensed to sell insurance products or to underwrite or reinsure insurance products either for coverage of third parties or for the self-insurance programs of a bank holding company, savings and loan holding company, and their affiliates. This group includes the following Institution Types:
A company established or designated by a foreign banking organization as its U.S. intermediate holding company under subpart O of the Federal Reserve Board’s Regulation YY (12 CFR part 252).
Non-Depository Trust Companies
Accepts and executes trusts, but does not issue currency. Can either be Federal Reserve members or Non-Members. This group includes the following Institution Types:
Companies not specifically listed, but in which there is regulatory interest, that are not authorized to accept deposits. This group includes the following Institution Types:
Savings and Loan Associations
A financial institution that accepts deposits primarily from individuals, and channels its funds primarily into residential mortgage loans.
Savings and Loan Holding Companies
A company that directly or indirectly controls a savings association or that controls another savings and loan holding company. This excludes any company that is also a bank holding company.
A financial institution organized to accept savings deposits and pay interest on those savings deposits. Savings banks can have state or federal affiliations (for example, state savings banks and federal savings banks). Includes the following Institution Types:
Entities primarily engaged in acting as agents (i.e., brokers/dealers) between buyers and sellers in buying or selling securities on a commission or transaction fee basis. Includes the following Institution Type:
U.S. Branches and Agencies of Foreign Banking Organizations
Entities contained within and controlled by a foreign banking organization. Includes the following Institution Types:
A branch office of a commercial bank, both of which are physically located in the United States.
Domestic Entity Other
Institutions that are physically located in the United States, which engage in banking activities, usually in connection with the business of banking in the United States.
Data Processing Servicer
Entities primarily engaged in providing infrastructure for hosting or data processing services. These establishments may provide specialized hosting activities, such as web hosting, streaming services or application hosting, provide application service provisioning, or may provide general time-share mainframe facilities to clients. Data processing establishments provide complete processing and specialized reports from data supplied by clients or provide automated data processing and data entry services.
A financial intermediary that makes loans to individuals or businesses.
An organization that is organized under the laws of a foreign country and that engages directly in the business of banking outside the United States.
Foreign Banking Organization (FBO)
A foreign bank that operates a branch, agency or commercial lending company subsidiary in the United States, controls a bank organized under U.S. law, or controls an Edge or agreement corporation, and any company of which a foreign bank is a subsidiary.
Foreign Banking Organization as a BHC
A foreign banking organization that also acts as a bank holding company and is thus supervised by the Board of Governors of the Federal Reserve.
Foreign Branch of a U.S. Bank
A branch that resides outside of the United States, but has a parent that is located in the United States.
Foreign Entity Other
Institutions that engage in banking activities, usually in connection with the business of banking, in foreign countries where such institutions are organized or operating.
Insured Branch of an FBO (Federal and State)
A branch that accepts retail deposits which are insured by the Federal Deposit Insurance Corporation.
Acts as an underwriter or agent that serves as intermediary between the issuer of securities and the investing public.
A commercial bank whose charter is approved by the Office of the Comptroller of the Currency (OCC) rather than by a state banking agency. National banks are required to be members of the Federal Reserve System and belong to the Federal Deposit Insurance Corporation.
Commercial banks that are state-chartered and NOT members of the Federal Reserve System. Include all insured commercial banks and industrial banks.
State Member Banks
Include all commercial banks that are state-chartered and members of the Federal Reserve System.
An organization that primarily accepts savings account deposits and invests most of the proceeds in mortgages. Savings banks, savings and loan associations, and credit unions are examples of thrift institutions.
Uninsured Agency of a FBO (Federal and State)
An uninsured agency does not accept retail deposits and needs not apply for federal deposit insurance.
Uninsured Branch of a FBO (Federal and State)
A branch that does not accept retail deposits and needs not apply for federal deposit insurance.