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YOUR BANK’S CORPORATE ORGANIZATION, NETWORK OF BANKS AND BRANCHES AND THE HOLDING COMPANY STRUCTURE
A. Your bank was chosen from the largest 25 banking companies in America. It is a big bank, rather than a community bank. Some of the corporate offices of these banking companies are located in global money centers such as New York and others are not, such as Bank of America located in Charlotte, North Carolina. Some have focused on wholesale banking, whereas others are more retail oriented and then some balance their efforts in both retail and wholesale banking. In Chapter 3, we first examine the internal organization of your banking firm. To get a better feel for your bank’s internal organization, go to your bank’s primary Web site. (If you do not have this, review the assignment for Chapter 2.) Because we rarely find an explicit organization chart, we will look at the lists of boards of directors and senior management to provide some insights. This information is almost always provided in the Web pages “About the Company” and “Investor Relations” and is often titled “Officers and Directors.” (If you have trouble locating this information, try exploring the site map of the banking company’s Web site.) Think about the designated role of the board of directors. Write one paragraph characterizing the composition of this board. Then turn your attention to the officers and senior management. Their titles and bio-sketches provide some insights regarding the internal organization of the banking company. Try to characterize the internal organization in one paragraph.
B. The Board of Directors and management of your financial firm must operate within the regulatory constraints set forth by legislators and regulators. Your banking company is a bank holding company (BHC) and, as such, it is registered and overseen by the Federal Reserve Board. The Gramm-Leach-Bliley (GLB) Act allowed banks to extend their nonbank financial services utilizing the financial holding company (FHC) structure. Go to the Federal Reserve Web site at www.fedralreserve.gov/generalinfo/ fhc/ and see whether your banking company is registered as an FHC.
Within your BHC/FHC, you have at least one institution (bank) chartered by either a state or federal agency. You have the spreadsheet you created in Chapter 2’s assignment containing this information. How many bank/thrift subsidiaries does the BHC/FHC have and what are their charters? What percentage of your holding company’s assets is held in FDIC-insured institutions? Are the individual institutions members of the Fed? Who are their primary federal regulators? Write one paragraph describing your BHC/FHC and its regulatory supervision derived from its choice in regulatory structure.
In this chapter we also discussed how banks use branching to expand operations. Write a paragraph describing your banking company’s use of branching by its affiliated institutions. The data characterizing branch operations is also included in Chapter 2’s spread sheet. Describe the number of domestic and foreign offices and characterize the company’s market area.