LAW 6461 - Financial Institutions

(crosslisted) NBA 6460

Fall. 3 credits. Student option grading.

S. Omarova.

An introduction to the regulatory structures, as well as some of the economic, technological and other factors, that pattern the conduct of financial intermediation in the U.S. The principal focus will be upon commercial banks, investment companies (mainly mutual funds), insurance companies, pension funds and securities firms in so far as these institutions discharge a common set of economic functions and give rise to a common cluster of counterparty and third party (“systemic”) risks. Legal topics to be covered accordingly include entry-, functional and geographical restrictions; consumer-protection (including disclosure requirements) and competition-promotion; capital adequacy-, solvency- and related forms of risk-regulation (including deposit insurance); community-reinvestment; and “self-regulation.” We shall also devote some attention to “alternative” financial service providers such as check-cashing services, community development financial institutions and micro-credit providers; and we shall take occasional note both of divergent (generally, non-American) jurisdictions’ dominant modes of financial intermediation and of the “globalization” of finance, in order both to place what is distinctive about the dominant American forms into bolder relief and better to understand the forces operating behind recent and still unfolding changes to the American (and global) financial and finance-regulatory environments. No prior background in financial law or economics is required, but it is helpful.