Exam 25: Exploring the Complexities of Financial Services and Regulation

Many of the financial institutions are engaged in mergers and acquisitions aimed at creating financial giants out of numerous smaller financial-service providers-giant service companies that can more effectively compete with each other and win greater shares of the financial-service marketplace.

The 12 leading industrialized nations adopted the Basle Agreement on Bank Capital Standards in July 1988 and pledged bank supervisory authorities in each nation to achieve a minimum overall bank capital-to-risk-adjusted-assets ratio of at least 8 percent.

Which of the following are the shifting characteristics and needs of today's financial-service customers?

What does the concept of a level playing field mean to financial institutions and the public? Who is most likely to be impacted when a level playing field exists?

Securitization opens up additional funding sources for financial institutions, adding liquidity and diversification and practically removing individual asset risk.

Smart cards are growing much faster in the U.S. then they are in Europe.

The "Single Regulator" approach calls upon one regulatory agency to oversee an entire financial-services company.

For the financial-services industry, the technological revolution in information analysis, storage, and transfer has not:

Globalization refers to the process by which financial services offered by different financial institutions begin to converge around the globe.

How is the character of the customer base that demands financial services changing today? What changes in the financial markets' customer base do you anticipate for the future? What are the implications of these projected changes in the customer base for managers of financial-service institutions?

Do you think market broadening will be an important force in shaping the future of the financial services marketplace? Please explain why you think so.

According to the text, future developments in regulation and deregulation will most likely be:

According to the textbook, the provision of relevant information is vital to the performance of the financial market, but too much information may be detrimental.

Regulators are likely to be looking closely in the years ahead at which of the following rules that apply to each financial institution?

In 1999, the U.S. Congress added to restrictions in place since the 1930s and prevented banks and financial-service holding companies the power to combine menus of banking, insurance, securities underwriting services and real estate brokerage services under the same financial-service organization.

Please explain the meaning of the term financial innovation. How about deregulation? Service proliferation?

A recent demographic trend is a decrease in the average age of couples having their first child.

Which of the following are the newer financial instruments and services that appear to have good prospects for rapid market development in the future?

More financial institutions are establishing interstate operations and expanding their marketing programs to cover whole regions and, in many instances, the whole globe (usually referred to as globalization).

The notion of a "level playing field" refers to the need for increased information flows to customers so that they can make an informed financial decision.