End of Glass-Steagall Act means opportunity

|tab|

With southwest Missouri's strong and diverse economy, the outlook for 2000 is filled with optimism and opportunity. Banking, as an industry, has the same outlook for 2000, and with the passage of the Gramm-Leach Financial Modernization Act, the banking industry and its customers can move into the 21st century free of stale, Depression-era banking laws.|ret||ret||tab|

The Financial Services Modernization Act of 1999 was passed in November, ending 66 years of Depression-era restrictions on the industry. Overall, the act modernizes the industry and gives banks and non-banks the chance to engage in free and open competition.|ret||ret||tab|

The legislation closes the book on the 1933 Glass-Steagall Act, which kept banks out of the stock market and the insurance business, and imposed other restrictions on bank holding companies. The act will allow banks, brokerage firms and insurers to enter each other's business, giving consumers and corporate clients a broader menu of financial services.|ret||ret||tab|

Under the act, bank holding companies will be allowed to own any securities firm, mutual fund company or other asset management business. Banks also will gain significant opportunities to increase global investing and be able to simplify many of the structures they have had to use in serving corporate customers. Also, banks will be allowed to own insurance underwriters and agencies.|ret||ret||tab|

Industry officials say increased competition will benefit consumers in significant ways. The Treasury Department estimates financial services companies will save $15 billion a year through streamlining. These savings will be passed on to consumers, who will enjoy lower costs, more convenience and choices, and higher quality products and services, according to the American Bankers Association.|ret||ret||tab|

This bill will allow banks to operate in ways that enable them to better meet customer needs.|ret||ret||tab|

|bold_on|(Steve Burch is southwest Missouri region executive for Bank of America.)|ret||ret||tab|

[[In-content Ad]]