Federal Supervision of Bank Holding Companies Needs Better, More Formalized Coordination

Bank holding companies control banks with three-fourths of the Nation's assets. In the past holding company affiliations have contributed to some bank failures. Current Federal laws divide the authority for supervising holding companies and their subsidiary banks among three Federal agencies hindering the agencies' abilities to effectively supervise these financial institutions. The Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Federal Reserve supervise different types of banks. The authority to examine and initiate actions in regard to most holding company organizations is divided between at least two of these Federal bank regulatory organizations.