ABSTRACT
Attention has already been drawn to a type of banking structure which appears to fall between a 'unit-banking' system (such as we have had over a period of years at least in some parts of the USA, though as we have seen it has latterly been greatly modified) and a developed system of branch banking (such as grew up in the United Kingdom and which has generally been followed in a number of Commonwealth countries, though again over more recent years subject to change and modification). The third type of banking structure has been called, for want of a better term, a 'hybrid' system. The classical examples of a 'hybrid' banking structure have been France and India, which despite their very different cultures and circumstances – both social and economic – have banking systems which in many ways are strikingly similar. Thus, France has long had – and substantial nationalisation of the constituent banks has not altered this a system in which there are large banks with nationwide networks of branches, a number of regional banks of importance, though very few independent of Paris, and still a relatively large number of local bankers. In India, there have long been large banks – likewise now nationalised – with nationwide networks of branches; truly regional commercial banks have now all but disappeared, though for a number of years India also boasted a number of these (e.g., in Bengal, the Punjab and in the South of India) and, latterly, there has been some move back towards regionalism through the regional rural banks sponsored by the large commercial banks; and, so far as local banks were concerned, the so-called indigenous bankers and the moneylenders (though perhaps now rather less important) have supplied local needs, supplemented by the cooperative banks. What is surprising is that a structure that was well established in both these countries over half a century ago should have changed – instructural terms – comparatively little, though there have of course been some modifications, which it will be our purpose to delineate. Other examples of hybrid systems may be less clear-cut – mostly they have been drawn from the countries of Western Europe and Japan – but in one form or another they evidence this combination of large banks with nationwide branch networks and varying degrees of regional and local representation, especially if one includes institutions like savings banks and the variety of quasi-banking bodies that has grown up in recent years. What
Agricole, the Chambre Syndicate of the banques populates, la Confederation National du Crédit Mutuel, the Caisse Centrale of the crédit cooperatif, la federation centrale du crédit mutuel agricole et rural and the centre national of the savings banks; the new law will also apply to the Crédit Fonder and the Crédit National, but not to the Caisse des Depdts et Consignations, or to the Banque de France (and similar institutions for overseas French possessions), the Treasury, and the financial services of the Post Office. By controlling the central organisations, influence can be exerted on all the institutions affiliated with them. The new legislation will continue in existence the Conseil National du Crédit (National crédit Council), but with an extension of its powers. Two committees were set up with members drawn from the CNC — the comite de la réglementation bancaire and the comite des etablissements de crédit — and these will report to it annually. The competence of the Commission de Contrôle des Banques has been greatly extended and a commission bancaire with wide powers will now exercise control and supervision over all the établissements de crédit approved by the comite des établissements de crédit with a framework laid down by the comité de la réglementation bancaire. It will also be responsible for compagnies financières set up as holding companies to manage établissements de crédit as a group, of which at least one must be a bank. Government commissioners were to be nominated to represent the State on the several central financial organisations to which the Law applies.
