Although the Gramm-Leach-Bliley Act was intended to free banking organizations (including banks and their holding companies) from a regulatory strait-jacket that was impeding their ability to compete, it has not yet had a significant effect.

Is the policy of separating banking and commerce after the adoption of the Gramm-Leach-Bliley Act in 1999still based on any comprehensible rationale or is it now simply superstition?

Measured against what the Gramm-Leach-Bliley Act should have achieved--the abilityto acquire or establish banks by insurance companies and securities firms--the Act has been a failure.

The Gramm-Leach-Bliley Act has created a competitive imbalance in the financial services market that is worse than what had existed before.

Samuel J. Baptista has served as the managing director responsible for government relations for Morgan Stanley since 1999. He handles global public policy affecting the firm’s securities, financial services, and bank card businesses. Before joining Morgan Stanley, he was instrumental in founding the Financial Services...

The Gramm-Leach-Bliley Act's requirement that companies that control banks engage only in activities that the Fed defines as "financial in nature" is its fatal flaw.

November 2001 marks the second anniversary of the Gramm-Leach-Bliley Act, which Congressman Leach called the "most important banking reform since the Federal Reserve Act of 1913." The act was supposed to create a financial services industry--a competitive environment in which banks, securities firms, and insurance companies could compete with...

Abstract

The Gramm-Leach-Bliley Act, despite Congress’s stated intentions, must be deemed to have eliminated the policy basis for separating banking and commerce. This conclusion ultimately reflects an unstated Congressional judgment that banks should no longer be treated differently from other financial institutions. Without this...