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Working Paper
Legal and regulatory reform in electronic payments: an evaluation of finality of payment rules
Each day approximately $1.3 trillion changes hands by means of wholesale wire transfers. Of this total, about $638 billion is exchanged on Fedwire, the Federal Reserve wire transfer network, while just under $622 billion moves over the privately-owned Clearing House Interbank Payment System (CHIPS). On Fedwire, the average transfer is $2.9 million, while transfers on CHIPS average $4.6 million. With such substantial amounts involved in virtually instantaneous transactions, it is not surprising that concern has risen over risks that a large network network participant will fail to settle its ...
Journal Article
A review of bank performance in the Fifth District, 1987
Profits at Fifth District commercial banks declined significantly during 1987. But the Fifth District decline pales in comparison with the dramatic fall in profitability for banks in the rest of the nation. Much of the decline in both Fifth District banks and throughout the nation was due to increased loan loss provisions at large banks, mostly against expected losses on Third World loans.
Journal Article
SIC: Switzerland's new electronic interbank payment system
It is an article of faith among American bankers and their regulators that some daylight overdrafts are necessary to the efficient functioning of large-dollar wire transfer systems. But the Swiss have injected an element of doubt by developing a system that does away with daylight overdrafts. Their new system processes a payment only if sufficient clearing funds are on deposit in the sending banks reserve account. If sufficient funds are not available, the payment is held in a queue until covering funds have arrived. Vital and Mengle describe the first eighteen months of the systems operation.
Journal Article
Banking under changing rules: the fifth district since 1970
Since 1970, the Fifth District has seen changes in state laws governing bank branching and interstate banking and in federal laws governing bank holding company activities. Now that branching within states has been liberalized in all Fifth District jurisdictions, the major field for future evolution of the law is in interstate banking. In particular, nationwide interstate banking, interstate branching, and de novo entry are the last areas in which the law blocks competition among banks.
Journal Article
The future of deposit insurance: an analysis of the alternatives
Deposit insurance, while reducing the threat of bank runs, also lessens bankers incentives to control risks. Reforms of the deposit insurance system are necessary to discourage excessive risk taking such as characterized the recent S&L crisis. The adoption of market value accounting, early closing of failed banks, and exposing uninsured depositors and creditors to lossesall would give bankers less incentives to take excessive risks with insured deposits.
Journal Article
Behind the money market: clearing and settling money market instruments
When a money market instrument is traded, the clearing and settlement process establishes the change in ownership. Because the process involves both costs and risks, money market participants have developed means of making clearing and settlement more efficient and less risky.
Journal Article
A review of bank performance in the Fifth District, 1985
An abstract for this article is not available
Journal Article
The discount window
An abstract for this article is not available
Journal Article
The case for interstate branch banking
During the 1980s, many states relaxed laws restricting branching, and most states opened up their borders to entry by out-of-state bank holding companies. This article suggests that both banks and consumers would benefit if laws were further modified to permit bank holding companies to consolidate their interstate subsidiaries into branch networks. While such a change is likely to lead to a smaller number of large banks (although those remaining would operate nationwide), there would probably be little change in the number of small banks serving local markets.
Journal Article
Intraday credit: risk, value, and pricing
An abstract for this article is not available