Financial Markets and Institutions:
Financial Services Industry Issues
OCG-93-10TR: Published: Dec 1, 1992. Publicly Released: Dec 1, 1992.
Pursuant to a congressional request, GAO summarized issues relating to the federal government's regulation of and relationship with the financial services industry, focusing on: (1) federal regulation of financial institutions; (2) rapidly changing financial markets; and (3) federal regulation of insurance industry solvency.
GAO noted that the: (1) federal government's many legislative and administrative attempts to address weaknesses and vulnerabilities in the financial services industry do not completely address such areas as the cleanup of the savings and loan association industry, modernization of the financial regulation structure, changes in the financial services industry, and serious weaknesses in insurance industry regulation; (2) federal government must be able to respond to such developments as the globalization of trading markets, new trading systems, new financial products, oversight of the investment advisory industry, and government securities markets; and (3) federal government has ultimate responsibility for the safety and soundness of insurance solvency regulation and can enhance regulation consistency and strengthen states' regulatory capabilities.