Banking & Financial Institutions: U.S. Regulation (LAW-724A-001)
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The course focuses on U.S. banking law. The world of banking—commercial banks, savings banks, savings and loans, credit unions, and money market mutual funds—is a world in upheaval. New products arrive at dizzying speed. Once-crucial distinctions among financial institutions now make little difference at all. Geographic restrictions that formerly confined banks to limited local markets have fallen before a tidal wave of deregulation. Banks long prohibited from paying consumers interest on checking accounts now compete vigorously for deposits. Nonbank financial institutions such as securities firms encroach upon the once-inviolable turf of deposit-taking. Banks expand into a wide range of nonbanking activities. Some banks have grown huge. Others have failed: more depository institutions failed during the 1980s than at any time since the Great Depression, and failures spiked again from 2008 through 2012. And these are just the most visible effects of a market revolution that has shaken the foundations of banking over the past three decades. All market changes spawn legal problems; revolutionary changes tax the legal system to its limits. So it is with banking. Stimulated by changing markets and fluctuating political pressures, the law governing depository institutions has itself undergone a revolution. Since 1980 Congress has passed eight important banking Acts – including landmark regulatory reform enacted in the Dodd-Frank Act – courts have decided many questions of first impression, and regulatory agencies have promulgated scores of important rules. Even so, the legal system lags behind impetuous market changes. The revolution in banking today presents both a challenge and an opportunity for students and practitioners of banking law. The challenge is to keep abreast of fast-paced developments in the law and the marketplace. The opportunity is to think creatively about how banking law is evolving in order to help clients protect their interests and avail themselves of new market opportunities. Despite many uncertainties in banking law, one thing we do know: the field will generate interesting and complex issues for many years to come.
Textbooks and Other Materials
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Carnell, Macey, and Miller, The Law of Financial Institutions, 5th Edition, 2013 (Aspen Casebook Series)
First Class Readings
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