12 Pages


ByAlexander Dill

This introduction presents an overview of the key concepts discussed in the subsequent chapters of this book. The book introduces readers to the banking business model, the risks created by the extreme maturity mismatch of banks’ balance sheet, and the factors underlying the rise of the bank holding company structure and financial conglomerates. It describes banks’ central role in the economy – in extending credit, intermediating between savers and borrowers, and operating the payments system – which makes them such a highly regulated industry. The book considers the statutory and regulatory framework, regulatory objectives, the supervisory structures of oversight, agency jurisdiction, the formation of regulatory expectations, and the myriad ways by which regulators convey these expectations. It discusses the impact that state corporate law, federal prosecutorial policies, and US sentencing guidelines have had in incentivizing firms to build meaningful corporate compliance programs.