Table 1 

Comparative Population, Gross Domestic Product and Selected Financial Asset Information 

for the EU and G-10 Countries: 1993

(Percentages)

Country World Open-End Investment Equity Market International OECD

Share of Share of World Share of World Share of World Share of

Population Company Assets Capitalization Debt Securities Domestic Debt 1

Share of Share of World

World GDP Banking Assets 2 3

 4 5 6

Securities 7

Austria 0.15 0.79 1.23 0.44 0.20 2.22 0.52

Belgium 0.18 0.91 2.17 0.37 0.56 1.38 1.53

Canada 0.53 2.07 1.71 2.10 2.34 7.11 2.38

Denmark 0.09 0..51 0.59 0.11 0.30 1.67 1.18

Finland 0.09 0.32 0.39 N A 0.17 2.34 0.30

France 1.05 5.42 7.56 11.70 3.27 7.51 4.81

Germany 1.48 8.27 11.59 5.14 3.32 5.89 6.99

Greece 0.19 0.27 0.23 0.08 0.09 0.67 0.31

Ireland 0.06 0.19 0.13 0.13 NA 0.69 0.12

Italy 1.04 4.29 3.34 1.56 0.98 3.44 6.02

Japan 2.27 18.23 25.31 11.01 21.48 16.68 20.17

Luxembourg 0.01 0.05 1.51 6.00 0.14 0.10 0.02

Netherlands 0.28 1.34 2.19 1.17 1.30 2.59 1.01

Portugal 0.18 0.37 0.46 0.23 0.09 0.24 0.21

Spain 0.71 2.07 2.58 1.74 0.85 1.11 1.19

Sweden 0.16 0.72 0.67 0.59 0.77 3.72 1.12

Switzerland 0.13 1.00 2.31 0.83 1.95 0.81 0.95

United 1.06 3.54 8.46 3.18 8.25

Kingdom 8.67 2.23

United States 4.69 27.08 13.18 50.24 36.78 8.68 47.38

Total 14.35 77.44 85.59 96.62 82.84 75.52 98.44

G-7 12.12 68.90 71.04 84.93 76.42 57.98 89.98 8

G-10 12.87 72.87 78.38 87.89 81.00 66.48 94.59 9

EU 6.73 29.06 42.99 32.44 20.29 42.24 27.56 10 11

SOURCE: Bank for International Settlements (1996); Euromonitor PLC (1996); International Finance Corporation (1996); International Monetary Fund 

(1996b); Investment Company Institute (1995); United States Department of Commerce (1995); and World Bank (1995).

NOTES: 1. World Population: 5.5 billion.

 2. World GDP: 23,269 billion USD.

 3. World Banking Assets: 25,185 billion USD.

 4. World Open-End Investment Company Assets: 4,131 billion USD.

 5. World Equity Market Capitalization: 13,964 billion USD.

 6. World International Debt Securities: 2,038 billion USD.

 7. OECD Domestic Debt Securities: 19,715 billion USD.

 8. Group of Seven (G-7) countries include Canada, France, Germany, Italy, Japan, the U.K., and the U.S.

 9. Group of Ten (G-10) countries include Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Sweden, Switzerland,

 the U.K., and the U.S. Switzerland became a full member in 1984, bringing the group to eleven members.

 10. European Union countries include Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, 

 the Netherlands, Portugal, Spain, Sweden, and the U.K. Though Austria, Finland, and Sweden did not become EU members 

 until January 1, 1995, they are included in the aggregate EU figures in the above table.

11. Excluding Ireland.
Table 2

Number of Domestic Companies, Market Capitalization and Gross National Product

EU and G-10 Countries: 1993

Country Number of Domestic Market Capitalization GNP Market Cap./GNP

Companies (Millions of USD) (Millions of USD) (percent)

Austria 111 28,437 183,530 15.5

Belgium 165 78,067 213,435 36.6

Denmark 257 41,785 137,610 30.4

Finland 57 23,562 96,220 24.5

France 472 456,111 1,289,235 35.4

Germany 426 463,476 1,902,995 24.4

Greece 143 12,319 76,698 16.1

Italy 210 136,153 1,134,980 12.0

Luxembourg 62 19,337 14,233 136.0

Netherlands 245 181,876 316,404 57.5

Portugal 183 12,417 77,749 16.0

Spain 376 119,264 533,986 22.3

Sweden 105 107,376 216,294 49.6

United Kingdom 1,646 1,151,646 1,042,700 110.4

Canada 1,124 326,524 574,884 56.8

Japan 2,155 2,999,756 3,926,668 76.4

Switzerland 215 271,713 254,066 107.0

United States 7,246 5,136,199 6,387,686 80.4

Other Countries (42) 13,570 2,397,813 4,671,032 51.3

Total (60 countries) 28,768 13,963,831 23,050,405 60.6

SOURCE: International Finance Corporation (1996).
Table 3

Banking Structure in the EU and G-10 Countries: 1993

Austria 5 Belgium Denmark 3 Finland France Germany Greece Ireland Italy 4 Luxembourg Netherlands Portugal Spain Sweden Kingdom

United 

OFFICES AND STAFF

Commercial Banks 57 151 112 14 425 330 41 43 315 218 176 42 168 15 491

Branch Offices 733 7,925 2,340 1,213 10,442 7,604 1,554 919 19,722 315 7,191 3,144 17,580 2,478 12,800 1

Banking Offices

(Banks + Branches) 790 8,076 2,452 1,227 10,867 7,934 1,595 962 20,037 533 7,367 3,186 17,748 2,493 13,291

Population ('000s) 7,962 10,068 5,181 5,055 57,530 80,975 10,346 3,560 56,960 395 15,239 9,865 39,048 8,692 58,099

Population per Bank 139,684 66,675 46,259 361,071 135,365 245,379 252,341 82,791 180,825 1,812 86,585 234,881 232,429 579,467 118,328

Population per Banking Office 10,078 1,247 2,113 4,120 5,294 10,206 6,487 3,701 2,843 741 2,069 3,096 2,200 3,487 4,371

Staff 18,192 77,088 45,465 25,099 226,847 221,000 40,867 21,500 315,120 16,143 109,200 59,748 153,638 37,472 378,710

Staff per Bank 319 511 406 1,793 534 670 997 500 1,000 74 620 1,423 915 2,498 771

Staff per Banking Office 23 10 19 20 21 28 26 22 16 30 15 19 9 15 28

BALANCE SHEET COMPOSITION

Total Assets (bil. USD) 126.8 657.8 160.5 95.0 1,379.4 963.2 63.7 71.2 964.1 464.0 733.7 142.8 583.4 177.1 2,189.4

Banking Assets per USD of GDP 0.70 3.12 1.19 1.13 0.91 0.50 0.87 1.49 0.97 37.12 2.37 1.69 1.22 0.96 2.33

Deposits (bil. USD) 73.2 332.5 86.1 24.5 279.7 411.9 54.4 26.9 526.5 204.9 382.4 86.0 261.6 91.2 1,558.6 2

Deposit-to-Asset Ratio

(in percent) 57.8 50.5 53.6 25.8 20.3 42.8 85.4 37.8 54.6 44.2 52.1 60.2 44.8 51.5 71.2

Loans (bil. USD) 57.8 352.0 73.7 32.3 477.4 631.9 16.7 34.5 402.3 103.4 456.4 54.7 226.3 90.2 1,502.8 2

Loan-to-Asset Ratio 

(in percent) 44.5 53.5 45.9 34.0 34.6 65.6 26.2 48.5 41.7 22.3 62.2 38.3 38.8 50.9 68.6

CONCENTRATION OF BANKING ASSETS

3-Firm Concentration Ratio 11

 (in percent) 61.4 44.4 63.7 93.8 63.6 89.5 98.3 93.6 35.9 17.2 59.0 38.1 50.1 86.6 29.1

Commercial Bank Share of Total

Assets of All Credit Institutions 

(in percent) 28.5 100.0 NA 73.0 51.4 27.0 73.9 81.4 77.4 98.8 100.0 NA 67.3 48.6 NA 12 13
Table 3 (continued)

Canada Japan Switzerland United States G-7 G-10 EU 10 6 7 8 9

OFFICES AND STAFF

Commercial Banks 60 150 293 10,971 12,742 13,377 2,598

Branch Offices 7,744 14,997 2,227 54,129 126,453 146,274 95,960 1

Banking Offices 

(Banks + Branches) 7,804 15,147 2,520 65,100 139,195 159,651 98,558

Population ('000s) 28,798 124,764 6,908 257,908 665,034 705,941 368,975

Population per Bank 479,967 831,760 23,577 23,508 52,192 52,773 142,023

Population per Banking Office 3,690 8,237 2,741 3,962 4,778 4,422 3,744

Staff 170,808 417,000 111,791 1,494,564 3,224,049 3,559,600 1,746,089

Staff per Bank 2,847 2,780 382 136 253 266 672

Staff per Banking Office 22 28 44 23 23 22 18

BALANCE-SHEET COMPOSITION

Total Assets (bil. USD) 567.6 6,130.2 731.6 3,707.2 15,901.0 18,201.2 8,772.0

Banking Assets per USD of GDP 1.04 1.46 3.15 0.59 0.99 1.07 1.27

Deposits (bil. USD) 443.1 3,914.8 411.6 2,754.1 9,888.8 11,106.5 4,400.5 2

Deposit-to-Asset Ratio 

(in percent) 78.1 63.9 56.3 74.3 62.2 61.0 50.2

Loans (bil. USD) 382.8 4,275.3 512.6 2,151.0 9,823.5 11,234.7 4,512.4 2

Loan-to-Asset Ratio 67.4 69.7 70.1 58.0 61.8 61.7 51.4

CONCENTRATION OF BANKING ASSETS

3-Firm Concentration Ratio (in percent) 65.2 28.3 79.8 13.3 NA NA NA 11

Commercial Bank Share of Total Assets of All Credit

Institutions (in percent) 80.3 NA 98.1 77.1 NA NA NA 14

SOURCE: Banking Federation of the European Union (1994); Bank of Japan; Canadian Bankers Association; Office of the Comptroller of the Currency using Federal Financial Institutions Examination Council 

and FDIC data; Office for Official Publications of the European Communities (1995); Organization for Economic Co-operation and Development (1995a) and (1995c); Statistical Office of the European 

Communities; Eurostat (1995); BankScope, Bureau van Dijk, IBCA; and supervisory authorities in the individual countries listed. 

NOTES: (1) Figures exclude foreign bank branches.

(2) Non-bank customers only.

(3) Data for commercial banks, savings banks and cooperative banks whose capital exceeds DKR 100 million (ECU 13.2 million).

(4) Figures include commercial banks and former savings banks, but exclude rural and artisanal banks and central institutions.

(5) Figures for all commercial banks, domestic and foreign, but excluding savings banks, Raiffeisen banks (credit cooperatives) and financial holding companies. 

(6) FDIC-insured commercial banks.

(7) Group of Seven (G-7) countries include Canada, France, Germany, Italy, Japan, the U.K., and the U.S.

(8) Group of Ten (G-10) countries include Belgium, Canada, France, Germany, Italy, the Netherlands, Japan, Sweden, Switzerland, the U.K., and the U.S. Switzerland became a full member in 1984, 

bringing the group to eleven members.

(9) European Union countries include Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the U.K. 

Though Austria, Finland, and Sweden did not become EU members until January 1, 1995, they are included in the aggregate EU figures in the above table.

(10) City banks, regional banks, trust banks, and long-term credit banks.

(11) Percent of total banking system assets accounted for by the largest three banks.

(12) For 1994.

(13) No distinctions from 1992 onwards.

(14) The figure is only 25.1 percent for the total assets of all financial service firms, not just depository institutions.
Table 4

Permissible Banking Activities and Bank Ownership in the EU and G-10 Countries: 1995

Country and

Bank Supervisor(s) Securities Insurance Real Estate 1 2 3

AUSTRIA Unrestricted; conducted either directly in bank or through subsidiaries. No Permitted; conducted only through subsidiaries. However, a bank may broker Unrestricted; conducted either directly in bank or through subsidiaries. The total

 Federal Ministry of Finance firewalls mandated. insurance policies. book value of a bank’s investment in real estate, plant and equipment, furniture and

fixtures must not exceed liable capital.

BELGIUM Permitted; conducted either directly in bank or through subsidiaries. No restrictions Permitted; conducted directly in the bank for those activities licensed by the Restricted; investments limited to real estate used in the exercise of the bank’s

 Banking and Finance Commission on bonds. However, a bank may not underwrite stock issues. No firewalls Insurance Supervisory Authority, and through insurance companies (subsidiaries), activities. May serve as an agent and manager of real estate for clients as well as

mandated. in which banks can own either controlling or minority participating interests, if engage in real estate leasing through subsidiaries.

certain framework conditions are fulfilled.

CANADA Permitted; conducted only through subsidiaries. No firewalls mandated. Permitted; conducted only through subsidiaries. Permitted; conducted only through subsidiaries.

 Office of the Superintendent of

 Financial Institutions

DENMARK Unrestricted; conducted either directly in bank or through subsidiaries. Firewalls Permitted; conducted only through subsidiaries. Permitted; banks are permitted to hold real estate to a book value not exceeding

 Danish Financial Supervisory are mandated. 20% of the bank’s own funds. Real estate in which the bank performs banking

 Authority activities are not included in this 20% limitation. Mortgage-credit activity is only

permitted through subsidiaries.

FINLAND Unrestricted; conducted either directly in bank or through subsidiaries. No Restricted; only selling of insurance policies as an agent is permitted. Permitted; may hold real estate and shares in real estate firms up to 13% of the

 Financial Supervision firewalls mandated. bank's total assets, either directly in bank or through subsidiaries.

FRANCE Unrestricted; conducted either directly in bank or through subsidiaries. No Permitted; sale of insurance products/services may be conducted directly in bank, Permitted; either conducted directly in bank or through subsidiaries, but limited to

 Credit Institutions Committee, firewalls mandated. but underwriting must be done through subsidiaries. 10% of the bank's net income.

Bank

 Regulatory Commission, and 

 Banking Commission

GERMANY Unrestricted; conducted directly in bank. No firewalls mandated. Restricted; conducted as principal only through insurance subsidiaries, which are Permitted; investment in equity and real estate, calculated at book value, may not

 Federal Banking Supervisory supervised by the Insurance Supervisory Office. Insurance regulation does not exceed a bank's liable capital, but unlimited through subsidiaries.

Office allow any business other than insurance business being carried out by an insurance

 and Deutsche Bundesbank firm. However, a bank may conduct insurance activities as agent without

restrictions.

GREECE Permitted; underwriting may be conducted directly in bank, whereas dealing and Restricted; selling of limited combined bank/insurance products by banks is Restricted; direct investment in real estate is limited to 50% of own funds for

 Bank of Greece brokerage must be conducted through subsidiaries. However, the selling of mutual permitted, but selling of separate insurance products by banks is not. The latter is purposes of conducting banking activities. Real estate investment for commercial

funds products directly by banks is permitted. Some firewalls are mandated. For allowed through bank subsidiaries. purposes is not permitted. The setting up of a subsidiary engaging in real estate

example, persons responsible for the management of a bank cannot hold similar management requires Bank of Greece permission. Subsidiaries engaging in real

positions in a securities firm. estate development are considered nonfinancial firms and are regulated according

to the EC Second Banking Directive.

IRELAND Unrestricted; conducted directly in bank or through subsidiaries. No firewalls are Prohibited. (6) Unrestricted.

 Central Bank of Ireland mandated.

ITALY Unrestricted; conducted either directly in bank or through subsidiaries. However, Permitted; sale of insurance products/services may be conducted directly in bank, Restricted; generally limited to bank premises.

 Bank of Italy for brokering and dealing in securities listed on an Italian exchange other than but underwriting must be done through subsidiaries.

Italian government and government-guaranteed securities, only through a special

subsidiary. Firewalls are mandated.

JAPAN Restricted; only bonds (not equities) and only through securities subsidiaries. A Prohibited. Restricted; generally limited to bank premises.

 Ministry of Finance (primary bank can only own more than 50% of a securities firm with permission from the

 responsibility) and Bank of Japan Ministry of Finance and Fair Trade Commission. Firewalls are mandated. 

4

LUXEMBOURG Unrestricted; conducted either directly in bank or through subsidiaries. No Permitted; bank employees may obtain an insurance license and thereby sell Unrestricted; conducted either directly in bank or through subsidiaries.

 Luxembourg Monetary Institute firewalls mandated. insurance products/services as an agent of insurance firms within the bank. 

However, a bank is allowed to carry out insurance activities through a subsidiary or

by taking an equity stake in an insurance firm, with prior approval.

NETHERLANDS Unrestricted; conducted directly in bank or through subsidiaries. No firewalls Permitted; sale of insurance products/services may be conducted directly in bank, Permitted; but real estate other than bank premises may not exceed 25% of the

 Bank of Netherlands mandated. but underwriting must be done through subsidiaries. More generally, an insurance actual own funds of the bank. 

company is not allowed to pursue the business of a bank within one corporation

(Insurance Companies Supervision Act).

PORTUGAL Unrestricted; conducted either directly in bank or through subsidiaries. However, Permitted; conducted only through subsidiaries for underwriting and selling as Restricted; generally limited to holding bank premises. Moreover, the net value of

 Bank of Portugal for the organized stock exchanges, brokerage and dealer activities must be principal. May sell as agent directly in bank. fixed assets shall not exceed own funds.

conducted through subsidiaries. No firewalls mandated.

SPAIN Unrestricted; conducted directly in bank or through subsidiaries, but banks do not Permitted; sale of insurance products/services may be conducted directly in bank, Restricted; generally limited to bank premises. Real estate and other immobilized

 Bank of Spain have direct access to official stock exchanges. No firewalls mandated. but underwriting must be done through subsidiaries. tangible assets are limited to 70% of own funds. Banks may also hold such assets

in payment of debts for up to 3 years.

SWEDEN Unrestricted; conducted directly in bank or through subsidiaries. No firewalls Permitted; bank may only directly sell insurance products/services. However, both Restricted; generally limited to bank premises.

 Financial Supervisory Authority mandated. banks and insurance firms are allowed to form “concern constellation” (financial

groups) as long as the two activities are conducted in different firms.
SWITZERLAND Unrestricted; conducted either directly in bank or through subsidiaries. No Permitted; conducted only through subsidiaries. Unrestricted; investments in a single real estate project are limited to the equivalent

 Swiss Federal Banking firewalls mandated. of 20% of the bank’s capital. However, the Swiss Federal Banking Commission

Commission can allow this limit to be exceeded.

Table 4 (continued)

Country and

Bank Supervisor(s) Securities Insurance Real Estate 1 2 3

UNITED KINGDOM Unrestricted; conducted either directly in bank or through subsidiaries. However, Permitted; sales of insurance products/services may be conducted directly in bank, Unrestricted; conducted either directly in bank or through subsidiaries.

 Bank of England gilt-edged market making must be conducted through a subsidiary. No firewalls but underwriting only through subsidiaries. However, the bank’s investment in the

mandated. subsidiary must be deducted from the bank’s capital when calculating its capital

adequacy if the bank ownership share in the subsidiary exceeds 20%.

UNITED STATES Restricted; national and state member banks generally are prohibited from Restricted; banks generally may engage in credit life and disability insurance Restricted; banks generally are restricted to investment in premises or that which is

 Federal Reserve System, underwriting or dealing in corporate debt and equity instruments or securities. underwriting and agency activities. National banks, in addition, may engage in necessary for the transaction of their business.

Comptroller They may, however, engage in discount and full service brokerage as well as serve general insurance agency activities in towns with less than 5,000 in population.

 of the Currency, Federal Deposit as agent for issues in privately placing securities. State non-member banks are

 Insurance Corporation, and State subject to the same restriction as national banks, unless the FDIC determines the

 Authorities. activity would not pose a significant risk to the deposit insurance fund.

Bank holding companies may, on a case by case basis, be permitted to underwrite

and deal in corporate debt and equity securities through a Section 20 subsidiary so

long as the subsidiary’s revenues for these activities do not exceed 10 percent of

total gross revenues. Firewalls are mandated.

EUROPEAN UNION (7) Not applicable; permissibility is subject to home country authorization and limited Not applicable; permissibility is subject to home country regulation. Not applicable; permissibility is subject to home country and host country

host country regulation, primarily notification requirements. (A single EU regulation.

"passport" exists.)
Table 4 (continued)

Country and Commercial Bank Investment

Bank Supervisor(s) in Nonfinancial Firms

Nonfinancial Firm 

Investment in 

Commercial Banks

Geographical Branching

Restrictions on

Commercial Banks within Country

Domestic Non-Domestic

Banks Banks

Prior Regulatory

Approval

Required

AUSTRIA Unrestricted; complies with the EC Second Banking Directive. Subject to this limitation, a bank Unrestricted; complies with the EC Second Banking Directive. None. None. No.

 Federal Ministry of Finance may own 100% of the equity in a nonfinancial firm. 4

5

BELGIUM Restricted; single share holding may not exceed 10% of bank's own funds and such share holding Unrestricted; complies with the EC Second Banking Directive. However, the Banking and None. None. Yes.

 Banking and Finance Commission on an aggregate basis may not exceed 35% of own funds. More restrictive than the EC Second Finance Commission examines the “fit and proper” character of those shareholders holding at

Banking Directive during a transition period least 5% of the bank’s capital. 4

CANADA Restricted; limited to 10% of the outstanding shares of a nonfinancial firm, with aggregate Restricted; limited to 10% of the outstanding shares. Since no shareholders may exceed this 10% None. Limited Yes.

 Office of the Superintendent of holdings not to exceed 70% of bank capital. limit, Canada is attempting to assure that banks are widely held. Restrictions.

 Financial Institutions

DENMARK Permitted; complies with the EC Second Banking Directive. However, a bank may not hold a Unrestricted; complies with the EC Second Banking Directive. However, a bank may not None. None. No.

 Danish Financial Supervisory permanent decisive participation in nonfinancial firms. without supervisory authority have engagement with a firm that through its ownership of shares or

 Authority otherwise directly or indirectly has a decisive influence on the bank.

4

5

FINLAND Unrestricted; complies with EC Second Banking Directive. Subject to this limitation, a bank may Unrestricted; complies with the EC Second Banking Directive. In the case of commercial None. None. No.

 Financial Supervision own 100% of the equity in any nonfinancial firm. banks, a firm is not allowed to vote at the annual meeting with more than 5% of the total voting 4

5

rights presented at the meeting.

FRANCE Unrestricted; complies with EC Second Banking Directive. Subject to this limitation a bank may Unrestricted; complies with the EC Second Banking Directive. None. None. No.

 Credit Institutions Committee, Bank own 100% of the equity in any nonfinancial firm. 

 Regulatory Commission, and 

 Banking Commission

4

5

GERMANY Unrestricted; complies with EC Second Banking Directive. Subject to this limitation a bank may Unrestricted; complies with the EC Second Banking Directive. None. None. No.

 Federal Banking Supervisory own 100% of the equity in any nonfinancial firm. 

Office 

 and Deutsche Bundesbank

4

5

GREECE Unrestricted; complies with EC Second Banking Directive. Subject to this limitation, a bank may Unrestricted; complies with the EC Second Banking Directive. None. None. Yes.

 Bank of Greece own 100% of the equity in any nonfinancial firm. 4

5

IRELAND Unrestricted; complies with the EC Second Banking Directive. Subject to these limitation, a bank Unrestricted. However, advance notification is required for any application of more than 5% of None. None. No.

 Central Bank of Ireland may own 100% of the equity in a nonfinancial firm. the voting rights in a bank, and prior approval is required for any acquisition of 10% or more of 4

the total shares or voting rights or any holding or interest that confers a right to appoint or remove

directors. 5

ITALY Restricted; more restrictive than the EC Second Banking Directive. Most banks are subject to an Restricted; more restrictive than the EC Second Banking Directive. Persons who engage in None. None. No.

 Bank of Italy overall investment limit of 15% of own funds (7.5% in the case of unlisted firms) and to a significant business activity in sectors other than banking and finance are forbidden from

concentration limit of 3% of own funds in each holding in nonfinancial firms or groups. Some acquiring an equity stake which, when added to those already held, would result in a holding

banks, due to their size and proven stability, are subject to less stringent limits (overall and exceeding 15% of the voting capital of a bank or in control of the bank. 

concentration limits of respectively 50% and 6% for leading banks, and 60% and 15% for

specialized banks). Consistency with the principle of separation between banking and commerce

is ensured by a further investment limit of 15% of invested firms’ capital for all banks. 4

5

JAPAN Restricted; a single bank's ownership is limited to 5% of a single firm's shares, including other Restricted; total investment is limited to firms capital or net assets. The Anti-Monopoly Law None. None Yes.

 Ministry of Finance (primary banks (Article 9, Anti-Monopoly Law). prohibits establishment of a holding company whose main business is to control the business

 responsibility) and Bank of Japan activities of other domestic companies through the holding of ownership.

LUXEMBOURG Unrestricted; complies with EC Second Banking Directive. Subject to this limitation a bank may Restricted; nonfinancial firms may legally be the majority shareholders in banks. However, None. None. Yes.

 Luxembourg Monetary Institute own 100% of the equity in any nonfinancial firm. general policy is to discourage nonfinancial groups or private persons from being major 4

shareholders in banks.

NETHERLANDS Unrestricted; complies with the EC Second Banking Directive. Subject to this limitation a bank Unrestricted; complies with the EC Second Banking Directive. However, a declaration of non- None. None. No.

 Bank of Netherlands may own 100% of the equity in any nonfinancial firm. However, a declaration of non- objection from the Minister of Finance (or the Nederlandsche Bank on behalf of the Minister) is 4

objection from the Minister of Finance (or the Nederlandsche Bank on behalf of the Minister) is required for an investment exceeding 5% of a bank's capital. 

required for any bank investment exceeding 10% of the capital of a nonfinancial firm.

5

PORTUGAL Permitted; complies with the EC Second Banking Directive. However, a bank may not control Unrestricted; complies with the EC Second Banking Directive. None. None. No.

 Bank of Portugal more than 25% of the voting rights of a nonfinancial firm. 4

5

SPAIN Unrestricted; complies with the EC Second Banking Directive. Subject to this limitation, a bank Permitted; complies with the EC Second Banking Directive. However, a nonfinancial firm None. None. No, for EU banks. 

 Bank of Spain may own 100% of the equity in any nonfinancial firm. cannot hold more that 20% of the shares of a new bank during the first five years of its existence. Non-EU banks 4

 Specified shareholder thresholds require authorization by the Bank of Spain before additional require 5

investment. authorization by

the Ministry of

Economy.

SWEDEN Restricted; investments on an aggregated basis are limited to 40% of a bank’s own funds. Restricted; ownership is limited to 50% except under certain circumstances when a bank is near None. None. Yes.

 Financial Supervisory Authority Ownership in a firm is limited to 5% of this base (i.e. 1.5% in a firm or group of firms related to insolvency and there is a need for external capital injection. In the latter case, greater ownership

each other). Furthermore, ownership in a firm must not exceed 5% of the total voting power in may be permitted, based upon suitability of new owners. 

the firm concerned. These limits do not apply when a bank has to protect itself against credit

losses. In this case the bank must sell when market conditions are appropriate. 4

5
SWITZERLAND Unrestricted; a single participation is limited to the equivalent of 20% of the bank’s capital. Unrestricted; a nonfinancial firm may own 100% of the equity in a bank. None. None. Yes, but only for

 Swiss Federal Banking Commission However, the Swiss Federal Banking Commission can allow this limit to be exceeded. non-domestic

banks.
Table 4 (continued)

Country and Commercial Bank Investment

Bank Supervisor(s) in Nonfinancial Firms

Nonfinancial Firm 

Investment in 

Commercial Banks

Geographical Branching

Restrictions on

Commercial Banks within Country

Domestic Non-Domestic

Banks Banks

Prior Regulatory

Approval

Required

UNITED KINGDOM Unrestricted; complies with the EC Second Banking Directive. Subject to this limitation, a bank Unrestricted; complies with the EC Second Banking Directive. However, a firm would have to None. But need None. However, Yes (see adjacent

 Bank of England may own 100% of the equity in any nonfinancial firm. However, an ownership share of more make application to the Bank of England to become a shareholder controller and receive the to comply with the a bank must make column).

than 20% requires that the investment be deducted from the bank’s capital when calculating its Bank’s non-objection. local requirements an application to

capital adequacy on a risk basis. Otherwise, the investment is treated as a commercial loan for and have adequate open a branch

the risk-based calculation. systems and unless passporting

controls for the into the UK under

function. the EC Second

Banking

Directive.

UNITED STATES Restricted; national and state member banks generally are prohibited from making direct equity Restricted; a nonfinancial firm may make equity investments in banks and bank holding Yes. Yes; same Yes.

 Federal Reserve System, investment in voting or nonvoting stock. State nonmember banks generally are limited to companies. However, the investment must not exceed 25 percent of the bank’s capital to avoid restrictions that

Comptroller investments that are permissible for national banks. Bank holding companies are limited to an becoming a bank holding company. In other words, banks may only be acquired by companies apply to domestic

 of the Currency, Federal Deposit investment not to exceed 25 percent of a nonfinancial firm's capital. that limit their activities to those deemed to be closely related to banking by the Federal Reserve banks.

 Insurance Corporation, and State Board.

 Authorities.

EU Banks Non-EU Banks

EUROPEAN UNION (7) Unrestricted; the EC Second Banking Directive (Article 12) limits “qualifying investments” to no Unrestricted; subjects qualifying investments to regulatory consent based only on the suitability of None. (A Single Restricted;

more than 15% of a bank’s own funds for investment in a single firm, and to no more than 60% shareholders. EU "passport" branches are fully

for all investment in nonfinancial firms. In exceptional circumstances, these limits may be exists.) regulated by the

exceeded, but the amount by which the limits are exceeded must be covered by a bank's own authorities of the

funds and these own funds may not be included in the solvency ratio calculation. EU member state

A qualifying investment is defined as a direct or indirect holding in an undertaking equal to at situated and do

least 10% if its capital or voting rights or permitting the exercise of significant influence over its not have access to

management. the single EU

in which they are

"passport" to

provide services

or establish

subsidiary

branches

throughout the

EU.

SOURCE: Supervisory authorities in the listed countries provided information used to prepare this table. However, they are not responsible for any errors or misinterpretations. For exact information one must consult the pertinent laws and regulations in the indi vidual countries. 

For France and Japan, a source was Institute of International Bankers (1995).

NOTES: (1) Securities activities include underwriting, dealing and brokering all kinds of securities and all aspects of the mutual fund business.

(2) Insurance activities include underwriting and selling insurance products/services as principal and as agent.

(3) Real estate activities include investment, development and management.

(4) The EC Second Banking Directive (Article 12) limits "qualifying investments" to no more than 15% of a bank's own funds for investments in a single nonfinancial firm and to no more than 60% for aggregate investments in nonfinancial firms. In exception al 

circumstances these limits may be exceeded, but the amount by which the limits are exceeded must be covered by a bank's own funds and these own funds may not be included in the solvency ratio calculation. A qualifying investment is defined as a direct or indirect 

holding in an undertaking equal to at least 10% of its capital or voting rights or permitting the exercise of significant influence over its management.

(5) The EC Second Banking Directive (Article 11) subjects qualifying investments to regulatory consent based only on the suitability of shareholders.

(6) However, 3 commercial banks are authorized to engage in assurance activities.

(7) The EU members are Austria (January 1, 1995), Belgium (original member), Denmark (January 1, 1973), Finland (January 1, 1995), France (original member), Germany (original member), Greece (January 1, 1981), Ireland (January 1, 1973), Italy 

(original member), Luxembourg (original member), the Netherlands (original member), Portugal (January 1, 1986), Spain (January 1, 1986), Sweden (January 1, 1995), and the United Kingdom (January 1, 1973).

DEFINITIONS: Unrestricted- A full range of activities in the given category can be conducted directly in the bank.

 Permitted- A full range of activities can be conducted, but all or some must be conducted in subsidiaries.

 Restricted- Less than a full range of activities can be conducted in the bank or subsidiaries.

 Prohibited- The activity cannot be conducted in either the bank or subsidiaries.
Table 5

Permissible Banking Activities and Bank Ownership in the EU and G-10 Countries: 1995

Securities Insurance Real Estate Investment in Investment in

Commercial Bank Nonfinancial Firm

Nonfinancial Firms Commercial Banks

Very Wide Powers:

Austria Unrestricted Permitted Unrestricted Unrestricted Unrestricted

Switzerland Unrestricted Permitted Unrestricted Unrestricted Unrestricted

United Unrestricted Permitted Unrestricted Unrestricted Unrestricted

Kingdom

France Unrestricted Permitted Permitted Unrestricted Unrestricted

Netherlands Unrestricted Permitted Permitted Unrestricted Unrestricted

Wide Powers:

Denmark Unrestricted Permitted Permitted Permitted Unrestricted

Finland Unrestricted Restricted Permitted Unrestricted Unrestricted

Germany Unrestricted Restricted Permitted Unrestricted Unrestricted

Ireland Unrestricted Prohibited Unrestricted Unrestricted Unrestricted

Luxembourg Unrestricted Permitted Unrestricted Unrestricted Restricted

Portugal Unrestricted Permitted Restricted Permitted Unrestricted

Spain Unrestricted Permitted Restricted Unrestricted Permitted

Somewhat Restricted Powers:

Italy Unrestricted Permitted Restricted Restricted Restricted

Sweden Unrestricted Permitted Restricted Restricted Restricted

Belgium Permitted Permitted Restricted Restricted Unrestricted

Canada Permitted Permitted Permitted Restricted Restricted

Greece Permitted Restricted Restricted Unrestricted Unrestricted

Restricted Powers:

Japan Restricted Prohibited Restricted Restricted Restricted

United States Restricted Restricted Restricted Restricted Restricted

SOURCE: Table 4.

NOTES: Securities activities include underwriting, dealing and brokering all kinds of securities and all aspects of the mutual fund business.

Insurance activities include underwriting and selling insurance products/services as principal and as agent.

Real estate activities include investment, development and management. 

DEFINITIONS: Unrestricted- A full range of activities in the given category can be conducted directly in the bank.

 Permitted- A full range of activities can be conducted, but all or some must be conducted in subsidiaries.

 Restricted- Less than a full range of activities can be conducted in the bank or subsidiaries.

 Prohibited- The activity cannot be conducted in either the bank or subsidiaries.
Table 6a

Permissible Corporate Organizational Form in which to Conduct Selected Bank Activities in Selected EU and G-10 Countries*

Country

Bank Holding

Company

Permitted

Securities Activities Insurance Activities Real Estate Activities 1 2 3

Directly in the Bank Most Frequently Directly in the Bank Most Frequently Directly in the Bank Most Frequently

Bank Subsidiary Conducted in Bank Subsidiary Conducted in Bank Subsidiary Conducted in 

Bank Holding Bank Holding Bank Holding

Company Company Company

Subsidiary Subsidiary Subsidiary

Austria Yes Yes Yes Bank No No Yes Company Yes Yes N A Bank Yes, but

infrequently used 

4

Bank Holding

 Subsidiary 5

Canada No No Yes No Bank Subsidiary No Yes No Bank Subsidiary Yes Yes & No No Bank Subsidiary

Finland Yes Yes Yes Bank Yes & No Yes Yes Bank Subsidiary No Yes No Bank Subsidiary Yes, but

infrequently used

 6

Germany Yes Yes Yes Bank No Yes Yes Bank Subsidiary Yes Yes Yes Bank Subsidiary Yes, but

infrequently used

7

Greece No Yes Yes No Bank Subsidiary Yes Yes No Bank Subsidiary No Yes No Bank Subsidiary 8 9 10 11

Ireland Yes Yes No Bank Subsidiary Yes Yes No Bank Yes Yes No Bank Yes, but

infrequently used

 12 12

Italy Yes, widely used Yes Yes No Bank Yes Yes Yes Bank Subsidiary 13 No Yes Yes Bank subsidiary

Luxembourg No Yes Yes No Bank No Yes No Bank Subsidiary Yes Yes No Bank Subsidiary 14

Netherlands Yes, widely used Yes Yes Yes Bank No Yes Yes Company No Yes Yes Bank Holding

Bank Holding and 

Subsidiary Company

Bank Subsidiary

Subsidiary

Portugal Yes Yes Yes Subsidiary Yes Yes Yes No Yes Yes Bank Subsidiary Yes, but Bank & Bank

infrequently used Subsidiary

Bank & Bank

Spain Yes Yes N A No Yes N A Bank Subsidiary No Yes N A Bank Subsidiary Yes, but Bank & Bank

infrequently used Subsidiary 15

Sweden No Yes Yes No Bank No Yes No Bank Subsidiary No No No N A

Switzerland Yes Yes Yes Bank Yes Yes Yes Bank Subsidiary Yes Yes Yes Bank Subsidiary Yes, but

infrequently used

United Kingdom Yes Yes Yes Varies Yes Yes Yes Yes Yes Yes Varies Yes, but Bank

infrequently used Subsidiary 16

* Information as of January 1997.

SOURCE: Office of the Comptroller of the Currency using information provided by bank supervisory authorities in the respective countries.

NOTES: (1) Securities activities include underwriting, dealing and brokering all kinds of securities and all aspects of the mutual fund business.

(2) Insurance activities include underwriting and selling insurance products/services as principal and as agent.

(3) Real estate activities include investment, development and management. 

(4) Securities activities fall under the banking activities provisions of Section 1 Austrian Banking Act. Hence, such business may be conducted exclusively by a bank.

(5) Insurance activities require a license by the insurance supervisory authority (Ministry of Finance).

(6) Insurance activities in Finland may be conducted in the bank as agent but not as principal.

(7) Except as agent for insurance companies.

(8) Holding companies may own the majority of shares in a Greek bank, but there is no specific legal framework referring to such companies.

(9) Only underwriting and custodian services.

(10) Only selling insurance products combined with deposits - no insurance risk may be assumed by banks.

(11) Excluding investment in bank premises.

(12) Only includes selling insurance products and services as agent.

(13) Italian banks are not directly involved in insurance activities; these must be conducted by insurance companies subject to specific rules. Banks usually act as an agent of insurance companies, selling product through their branches.

(14) Pure holding companies are permitted to incorporate under Luxembourg law, but the statute of a bank holding company does not exist. This type of company is not submitted to any prudential control by any authority.

(15) Public debt directly in bank and stock exchange in bank subsidiary.

(16) With the exception of selling insurance as an agent, which is commonly conducted directly in the bank.
Table 6b

Permissible Corporate Organizational Form in which to Conduct Selected Bank Activities in the U.S.*

Corporate Organizational Form Securities Activities Insurance Activities Real Estate Activities 4 1 2 3

Directly in Bank:

National Bank Limited Limited No 4 5 6

State Bank Varies Varies Varies 7 8 9

Indirectly Through Subsidiary of:

National Bank Limited Limited Limited

State Bank Varies Varies Varies

Bank Holding Company Nonbank Subsidiary Limited Limited Limited 11 12 13

* Information as of January 1997.

SOURCE: Office of the Comptroller of the Currency.

NOTES: (1) Securities activities include underwriting, dealing and brokering all kinds of securities and all aspects of the mutual fund business.

(2) Insurance activities include underwriting and selling insurance products/services as principal and as agent.

(3) Real estate activities include investment, development and management. 

(4) National banks are not permitted to underwrite or deal in securities, except for governmental obligations or other designated securities. 12 U.S.C Sections 24(Seventh) and 378. 

National banks may engage in brokering all types of securities and investment products.

(5) National banks operating in a place of 5,000 or less are permitted to sell all insurance products. Other national banks are limited to selling credit related insurance.

(6) With the exception of bank premises and property acquired in connection with credit activities, national banks are not permitted to hold or deal in real estate.

(7) The permissibility of state bank securities activities varies from state to state. Under the Federal Deposit Insurance Act, however, insured state banks may not engage as principal in any 

type of activity that is not permissible for a national bank unless the Federal Deposit Insurance Corporation determines that the activity does not pose a significant risk to the insurance fund 

and the state bank is in compliance with applicable capital standards. 12 U.S.C. 1831a(a) (the “FDI Act Limitation”).

(8) The permissibility of state bank insurance sales activities varies from state to state subject tot he FDI Act Limitation. State banks may not underwrite insurance except to the extent that 

activity is permissible for national banks. 12 U.S.C. 1831a(b)(1).

(9) The permissibility of state bank real estate activities varies from state to state subject to the FDI Act Limitation.

(10) Subsidiaries of national banks may engage in activities that tare authorized for their parent banks or are part of or incidental to the business of banking.

(11) In addition to brokerage activities, and subject to specific approval, bank holding company subsidiaries may underwrite a limited amount of bank-ineligible securities. 12 U.S.C. Section 337.

(12) Bank holding companies generally are limited to sale of credit related insurance except in small towns or other places with inadequate insurance agency facilities. 12 C.F.R. Section 225.25(b)(8)(iii).

(13) Bank holding companies may perform appraisals of real estate and, under certain conditions, act as an intermediary for the financing of commercial or income producing real estate. 12 C.F.R. 

Sections 25(b)(14) and (15).
Table 7

List of Bank Activities Subject to Mutual Recognition in the EU

Acceptance of deposits and other repayable funds from the public.

Lending. 1

Financial leasing.

Money transmission services.

Issuing and administering means of payment (e.g. credit cards, travelers’ cheques and bankers’ drafts).

Guarantees and commitments.

Trading for own account or for account of customers in:

 a. Money market instruments (cheques, bills, CDS, etc.)

 b. Foreign exchange

 c. Financial futures and options

 d. Exchange and interest rate instruments

 e. Transferable securities.

Participation in share issues and the provision of services related to such issues.

Advice to undertakings on capital structure, industrial strategy and related questions and advice and services relating to

mergers and the purchase of undertakings.

Money brokering.

Portfolio management and advice.

Safekeeping and administration of securities.

Credit reference services.

Safe custody services.

SOURCE: Official Journal of the European Communities (1989).

NOTES: 1. Including inter alia: consumer credit; mortgage credit; factoring, with or without recourse; financing of commercial

transactions (including forfaiting).

2. The Second Banking Directive specifies that EU bank or “credit institution” (i.e., deposit-taking and lending institutions) 

may conduct directly or through branches the listed activities throughout the EU so long as their home countries authorize 

the activities. Subsidiaries of credit institutions governed by law of the same member state may also conduct the activities,

subject to conditions that include 90 percent ownership and a guarantee of commitments by the parent credit institutions. 

Insurance and real estate are not on the list and are therefore determined by home and host country regulations. The Second

Banking Directive took effect January 1, 1996. 
Table 8

U.S. Bank Holding Companies with Section 20 Subsidiaries 1

(February 1996)

Banking Organization Effective Date

Bankers Trust New York Corporation April 1987 4

Citicorp April 1987 4

J.P. Morgan & Co., Inc. April 1987 4

PNC Financial Corp. July 1987

Chase Manhattan Corporation May 1987 4

Chemical Banking Corporation May 1987 2 4

The Bank of Montreal May 1988 4

First Chicago NBD Corporation August 1988 5

Fleet Financial Group October 1988

Barnett Banks January 1989

Nationsbank Corporation May 1989 4

SouthTrust Corporation July 1989

First Union Corporation August 1989 4

Norwest Corporation December 1989

Barclays Bank PLC January 1990 5

Canadian Imperial Bank of Commerce January 1990 4

The Royal Bank of Canada January 1990 4

The Bank of Nova Scotia April 1990 4

The Long-Term Credit Bank of Japan, Ltd. May 1990

The Toronto-Dominion Bank May 1990 4

The Sanwa Bank, Ltd. May 1990

ABN AmRo Bank N.V. June 1990 4

Banc One Corporation July 1990

Dai-Ichi Kangyo Bank, Ltd. January 1991

Dauphin Deposit Corporation June 1991 4

Synovus Financial Corporation September 1991

Huntington Bancshares Inc. December 1992

Deutsche Bank AG December 1992 4

BankAmerica Corporation March 1992 4

Bank South Corporation May 1993 3

SunTrust Banks, Inc. August 1994

Republic New York Corporation (sub. of Saban, S.A.) January 1994 4

National City Corporation February 1994 4

First of America Corporation October 1994 5

Swiss Bank Corporation December 1994 4

Mellon Bank Corporation April 1995

Banco Santander, S.A. March 1995 4

Keycorp February 1996

HSBC Holdings PLC February 1996 4

SOURCE: Federal Reserve System.

NOTES: 1. Authorized to underwrite and deal in certain municipal revenue bonds, mortgage-related securities, commercial paper and 

consumer-receivable related securities.

2. Chemical Banking Corporation received Board approval to merge with Chase Manhattan Corporation on January 5, 1996.

3. Nationsbank Corporation received Board approval to acquire Bank South Corporation on December 18, 1995.

4. Also has corporate debt and equity securities powers

5. Also has corporate debt securities powers
Table 9a

Key Dates for the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994

Date Event Summary

September 24, 1994 to Interstate Bank Merger and Branch A state may “opt in early” to allow

May 31, 1997 Acquisition Early Opt-in interstate merger transactions, including

branch acquisitions, to occur prior to June

1, 1997.

Interstate Bank Merger Opt-out A state may “opt-out” to prohibit interstate

merger transactions entirely.

Anytime after date of Interstate De Novo Branching Opt- A state may expressly permit out-of-state

enactment in. banks to establish de novo branches within

its limits.

One year after date of Interstate Banking A bank holding company may acquire

enactment and thereafter banks located in any state. States do not

have the ability to opt out. However, the

acquiring institution is not permitted to

control more than 10 percent of nationwide

deposits or 30 percent of deposits in the

state entered.

Facility Banking A bank subsidiary may provide certain

banking services as an agent for its

depository institution affiliates. 

June 1, 1997 and thereafter Interstate Bank Mergers Banks in different states may merge, unless

one of the states has opted out of interstate

merger transactions by June 1, 1997.

Interstate Branch Acquisitions Banks may acquire an existing branch

located in another state, if the law of that

State permits it.

30-Mile Relocations The Act restricts a national bank’s ability

to retain its branches following an interstate

main office relocation.

SOURCE: Office of the Comptroller of the Currency.
Table 9b

Status of Interstate Branching Legislation in the States*

State Opt In Opt Out Effective Allows Acquisition of Minimum Age

 Date De Novo Branch Only Requirement 1

Alabama 5/31/97 Yes n/a No No 5 Year

Alaska 1/1/94 n/a n/a No No None 2

Arizona 8/31/96 Yes n/a No No 5 Year

California 10/2/95 Yes n/a No No 5 Year

Colorado 6/1/97 No n/a No No 5 Year 3

Connecticut 6/27/95 Yes n/a Reciprocal basis Yes 5 Year

Delaware 9/29/95 Yes n/a No No 5 Year

District of

Columbia 6/13/96 Yes n/a Reciprocal basis Reciprocal basis 2 Year

Florida 5/31/97 Yes n/a No No 3 Year

Georgia 6/1/97 Yes n/a No No 5 Year

Hawaii 6/1/97 Yes n/a No No 5 Year

Idaho 7/1/95 Yes n/a No No 5 Year

Illinois 6/1/97 Yes n/a No No None

Indiana 3/15/96 Yes n/a Reciprocal basis Yes None

Iowa 6/1/97 No n/a No No 5 Year 3

Kentucky 6/1/97 Yes n/a No No 5 Year

Louisiana 6/1/97 No n/a No No 5 Year 3

Maine 1/1/97 Yes n/a Reciprocal basis Yes None

Maryland 9/29/95 Yes n/a until 6/1/97, then Yes None

Reciprocal basis

unrestricted

Massachusetts 8/2/96 Yes n/a Reciprocal basis Yes 3 Year

Michigan 11/29/95 Yes n/a Reciprocal basis Yes None

Minnesota 6/1/97 Yes n/a No No 5 Year

Mississippi 5/1/97 Yes n/a No No 5 Year

Nevada 9/28/95 Yes n/a 5 Year In counties with In counties with

less than 100,000 less than 100,000

New Hampshire 6/1/97 Yes n/a No No 5 Year

New Jersey 4/17/96 Yes n/a No Reciprocal basis None
Table 9b (continued)

State Opt In Opt Out Effective Allows Acquisition of Minimum Age

 Date De Novo Branch Only Requirement 1

New Mexico 9/1/96 Yes n/a No No 5 Year

New York 2/6/96 Yes n/a No Yes None

North Carolina 6/22/95 Yes n/a until 6/1/97, then Yes None

Reciprocal basis

unrestricted

North Dakota 5/31/97 Yes n/a No No None

Oklahoma 5/31/97 Yes n/a No No 5 Year

Oregon 2/27/95 Yes n/a No Yes 3 Year

Pennsylvania 7/6/95 Yes n/a Reciprocal basis Reciprocal basis None

Puerto Rico 9/29/95 Yes n/a Yes Yes None 4

Rhode Island 6/20/95 Yes n/a Reciprocal basis Yes None

South Carolina 7/1/96 Yes n/a No No 5 Year

South Dakota 7/1/96 Yes n/a No No 5 Year

Tennessee 6/1/97 Yes Yes No No 5 Year

Texas 8/28/95 Yes n/a n/a n/a n/a

Utah 6/1/95 Yes n/a No Yes 5 Year

Vermont 5/30/96 Yes n/a No Yes 5 Year

Virginia 7/1/95 Yes n/a Reciprocal basis Yes None

Washington 6/6/96 Yes n/a No No 5 Year

West Virginia 5/31/97 Yes n/a Reciprocal basis Reciprocal basis None

Wyoming 5/31/97 Yes n/a No No 3 Year

* As of February 21, 1997, 43 states, the District of Columbia and Puerto Rico have acted on interstate branching.

NOTES: 1. Allows out-of-state banks to acquire a portion of an in-state bank’s branch network rather than requiring the purchase of the entire bank.

2. Passed interstate branching legislation pre-Riegle-Neal.

3. Includes no express authorization of interstate branching, but sets requirements and restrictions on interstate branch operation.

4. Circular Letter Number 95-96-D-55-2, issued on September 29, 1995, clarifies that interstate banking and branching have been authorized by the

Banking Act since its adoption in 1933.

SOURCE: Conference of State Bank Supervisors.
Table 10

Deposit-Insurance Schemes for Commercial Banks in the EU and G-10 Countries: 1995

Administration of and Membership in the System

Country Name of Guarantee/Insurance Year First Established Date Current System Took Administration of System: Agency Responsible for Membership: Voluntary or

System Effect Government or Industry Administering System Compulsory

Austria Deposit Guarantee System 1979 July 1, 1995 Industry Sectoral Associations Compulsory

Belgium Guarantee Scheme for Deposits 1974 January 1, 1995 Government/Industry - joint Herdiscontering-en Compulsory

with Credit Institutions Waarborginstituut-Institut de

Reescompte et de Garantie

Canada Canada Deposit Insurance 1967 1967 Government (Crown Canada Deposit Insurance Compulsory

System Corporation) Corporation

Denmark Deposit Insurance Fund 1987 July 1, 1995 Government Deposit Insurance Fund Compulsory

Finland Quarantee Fund of Commercial 1966 July 1, 1995 Industry Quarantee Fund of Commercial Compulsory 1

Banks and Postipankki Ltd. Banks and Postipankki Ltd.

France Deposit Guarantee Fund 1980 No information Industry French Bankers’ Association Compulsory

Germany Deposit Protection Fund of the 1966 1976 Industry Federal Association of German Voluntary

Federal Association of German Banks

Banks

Greece Deposit Guarantee Fund 1995 July 17, 1995 Government/Industry - joint Deposit Guarantee Fund Compulsory 2

Ireland Deposit Protection Account 1989 July 1, 1995 Government Central Bank of Ireland Compulsory

(Central Bank)

Italy Fonds Interbancario Di Tutela 1987 1987 Industry Independently Administered Voluntary

Dei Depositi

Japan Deposit Insurance Corporation 1971 No information Government/Industry - joint Deposit Insurance Corporation Compulsory

Luxembourg Association pour la Garantie des 1989 October 1995 Industry AGDL Compulsory

Depots, Luxembourg (AGDL)

Netherlands Collective Guarantee System 1979 July 1, 1995 Government/Industry - joint De Netherlandsche Bank N.V. Compulsory

Portugal Deposit Guarantee Fund 1992 1994 Government Deposit Guarantee Fund Compulsory

Spain Deposit Guarantee Fund 1977 End of 1995 Government/Industry - joint Fondo de Garantia de Depositos Compulsory

Sweden Swedish Deposit-Guarantee 1974 January 1, 1996 Government The Bank Support Authority Compulsory

Scheme

Switzerland Deposit Guarantee Scheme 1982 July 1, 1993 Industry Swiss Banker’s Association Voluntary

United Kingdom Deposit Protection Fund 1982 July 1, 1995 Government Deposit Protection Board Compulsory

United States Bank Insurance Fund 1933 January 1, 1996 Government Federal Deposit Insurance Compulsory

Corporation

European Union Determined within each member Adopted on May 30, 1994 July 1, 1995 Only directs that each member Determined within each member Compulsory

(EC Directive on state state shall ensure within its state.

Deposit-Guarantee territory one or more deposit

Schemes) guarantee schemes are introduced

and officially recognized.
Table 10 (continued)

Coverage or Protection

Country Denominated Deposits Extent or Amount of Interbank Deposits Non-resident Depositors

Coverage Covered Covered 

Deposits of Foreign Branches of Domestic Banks Deposits of Domestic Branches of Foreign Banks

Covered Covered Foreign-Currency

Branches located in EU Branches located in Non- Branches of EU Banks Branches of Non-EU Covered

Country EU Country Banks

Austria ATS 260,000 (per physical No Yes Yes Yes, amount depends on Yes Yes Yes

person-depositor) home country.

Belgium 15,000 ECU until Dec. 1999 No Yes No Yes Yes Yes; but only deposits Yes

20,000 ECU thereafter expressed in ECU or another

 4

EU currency.

Canada Can $60,000 (per depositor) Yes No No Yes Yes No Yes 3 3

Denmark 300,000 DKK or 42,000 No Yes Yes Yes Yes Yes Yes

ECU (per depositor)

 4

Finland 100 percent (per depositor) No Yes Yes Yes Yes Yes Yes 4

France FF 400,000 (per depositor) No Yes No, except for EEA Yes Yes Yes, but only deposits No information

countries. expressed in ECU or another

EU currency.

Germany 100% up to a limit of 30% of No Yes Yes Yes Yes Yes Yes

the bank’s liable capital (per

depositor)

Greece 20,000 ECU (per depositor) No Yes Yes Yes Yes Yes Yes 5 5 4 6

Ireland 90% of deposit - Max. No Yes Yes No Yes Yes Yes

Compensation is 15,000

ECU

Italy 100% of first 200 million Lit No Yes Yes Yes Yes Yes Yes

and 75% of next 800 million

Lit (per deposit)

 7

Japan 10 million Yen (per No No No No No No Yes

depositor)

Luxembourg Lux F 500,000 (per No No No Yes Yes Yes Yes

depositor), only natural

persons

Netherlands 20,000 ECU (per depositor); No Yes No Yes Yes Yes Yes

compensation paid in

Guilders

 4 8

Portugal 100% up to 15,000 ECU No Yes No Yes Yes Yes Yes

75% - 15,000 - 30,000 ECU

50% - 30,000 - 45,000 ECU

(per depositor)

 4

Spain Ptas 1.5 million (per No Yes Yes Yes Yes Yes Yes

depositor); to be increased to

20,000 ECU.

Sweden SEK 250,000 (per No Yes No Yes Yes Yes Yes

depositor)

9 10 4

Switzerland SF 30,000 (per depositor) No No No Yes Yes Yes Yes

United Kingdom 90% of protected deposits, No Yes, throughout EEA. No Yes Yes Yes, but only deposits in Yes

with the maximum amount other EEA currencies and

of deposits protected for the ECU, as well as sterling.

each depositor being

L20,000 (unless the sterling

equivalent of ECU 22,222 is

greater). Thus, the most an

individual can collect in a

bank failure is L18,000 (per

depositor) or ECU 20,000 if

greater.

12 13

United States 100,000 USD (per depositor) No No No No, unless engaged in retail No, unless engaged in retail Yes Yes

deposit-taking activities. deposit-taking activities.
European Union The aggregate deposits of No If located within the EU, but This issue is determined by Yes, either by having NA Yes, if denominated in ECU Yes, determined within each

each depositor must be until December 31, 1999 not each member state. coverage equivalent to the or currencies of member member state.

covered up to ECU 20,000. to exceed the maximum Directive or by joining the states of EU. Otherwise, de

Until December 31, 1999, amount laid down in their host-country depositmember states in which guarantee scheme within the guarantee scheme if it is

deposits are not covered up territory of the host member more favorable for the extra

to ECU 20,000 may retain state. If the host member coverage.

the maximum amount laid state has greater coverage a

down on their guarantee branch may voluntarily

schemes, provided that this supplement its coverage. 

amount is not less than ECU

15,000 (per depositor).

Table 10 (continued)

Funding

Country Ex ante or Ex post Funding Base for Premium Premium Rate Fund Minimum Risk-Based

Reserve Level Premiums

Austria Ex post, system organized as an incident-related guarantee facility. NA The deposit guarantee system shall obligate its member institutions, in See adjacent column to left. NA

case of paying-out of guaranteed deposits, to pay without delay pro rata

amounts which shall be computed according to the share of the

remaining member institution at the preceding balance sheet date as

compared to the sum of such guaranteed deposits of the deposit

guarantee system.

Belgium Ex ante, but in case of insufficient reserves, banks may be asked to No Total amount of customers’ deposits which qualify for reimbursement 0.02 percent No

pay, each year if necessary, an exceptional additional contribution up to and which are expressed either in BEF, ECU or another EU currency.

0.04 percent.

Canada Ex ante No Insured Deposits One-sixth of one percent No

Denmark Ex ante Yes, 3 billion DKK. Deposits Max 0.2 percent No

Finland Ex ante No Total Assets Between 0.01 and 0.05 percent No

France Ex post NA The contribution consists of two parts: a 1. A fixed part, irrespective of See adjacent column to left. NA

the size of the bank, equal to 0.1% of any claim settled and with a FFR

200,000 ceiling;

2. A proportional part, varying according to a regressive scale relative

to the size of the bank contributing, based on deposits and one-third

credits.

Germany Ex ante; however, additional assessments may be made if necessary to No Balance sheet item “Liabilities to Customers.” 0.03 percent No

discharge the fund’s responsibilities. These contributions are limited to

twice the annual contribution.

Greece Ex ante No Total Deposits 0 - 200 billion GRD 2%; No

 200 - 500 billion GRD 1%;

 500 - 1,000 billion GRD 0.4%;

Above 1,000 billion GRD 0.1%

Ireland Ex ante No, but see information Total Deposits excluding Interbank Deposits and Deposits represented 0.2 percent, with a minimum of L 20,000 No

under Premium Rate by Negotiable Certificates of Deposit.

column. 

Italy Ex post; banks commit ex ante, however contributions are ex post. NA Max. limit for funding the whole system: 4,000 Billion Lire. See adjacent column to left. NA

Contributions are distributed among participants on the basis of: 

(Deposits + Loans - Own Funds) with a correction mechanism linked to

deposit growth.

Japan Ex ante No Insured Deposits 0.012 percent No

Luxembourg Ex post NA Banks’ premiums based on percentage of loss to be met. See adjacent column to left. NA

Netherlands Ex post NA Amount repaid in Compensation to insured is apportioned among See adjacent column to left. NA

participating institutions. However, the contribution in any one year

shall not exceed 5% per an institution’s own funds and per all

institutions’ own funds.
Portugal Ex ante. However, the payment of the annual contributions may be No Guaranteed Deposits 0.08 to 0.12 percent Yes

partly replaced, with a legal maximums of 75%, by the commitment to

deliver the amount due to the Fund, at any moment it proves necessary.
Table 10 (continued)

Funding

Country Ex ante or Ex post Funding Base for Premium Premium Rate Fund Minimum Risk-Based

Reserve Level Premiums

Spain Ex ante No Deposits Max. 2 per thousand. Premiums will be interrupted No

when the fund reaches 2%.

Sweden Ex ante No Covered Deposits 0.25 percent Yes 11

Switzerland Ex post NA Two Components: Fixed fee in relation to gross profit; Variable fee See adjacent column to left. NA

depending on share of total protected deposits of an individual bank.

United Kingdom Ex ante; banks make initial contributions of L10,000 when a bank is Yes, the fund is required All deposits in EEA currencies less deposits by credit institutions; Initial contributions are 0.01 percent. The rate of No

first authorized, further contributions if the fund falls below L3 million, by law to maintain a level financial institutions, insurance undertakings, directors, controllers and other contributions depends on the sum required to

not exceeding L300,000 per bank based on the insured deposit base of of managers, secured deposits, CDS, deposits by other group companies be raised.

the banks involved, and special contributions, again based on the L 5 million to L 6 million, and deposits which are part of the bank’s own funds.

insured deposit base of the banks involved, but with no contribution but the DPB can decide to

limit. borrow to meet its needs.

United States Ex ante Yes, 1.25 percent of Domestic Deposits 0 to 0.27 percent, subject to a flat minimum of Yes

insured deposits. $2,000 for the highest rated banks.

European Union Determined within each member state. Determined within each Determined within each member state. Determined within each member state. Determined within

member state. each member state.

SOURCE: Supervisory authorities in the listed countries provided information used to prepare this table. However, they are not responsible for any errors or misinterpretations. For exact information one must consult the pertinent laws and regulations in the i ndividual countries. 

 In the case of Japan, a source was Lee (1996). In the case of France, a source was Banking Federation of the European Union (1995).

NOTES: 1. A government guarantee fund was also established in 1992.

2. There was no deposit guarantee scheme prior to 1995.

3. Foreign banks must incorporate subsidiaries to operate in Canada. Deposits of foreign bank subsidiaries are covered by CDIC insurance.

4. Yes, if they join for supplementary coverage.

5. Unless covered by an equivalent host country scheme.

6. Unless covered by an equivalent home country scheme.

7. Only if bank does not participate in local system.

8. If the coverage by their home state is equivalent.

9. Covers EEA countries.

10. Unless application for non-EEA country is approved.

11. Premium rate varies by institution based upon several factors.

12. For depositors of UK branches of EEA banks whose coverage is less generous, they have the option to pay for equivalent coverage.

13. Unless the Deposit Protection Board is satisfied that the home country scheme provides equivalent coverage to UK depositors. 

DESCRIPTION: The EU and the 7-member European Free Trade Association (EFTA) - except Switzerland - form the European Economic Area (EEA), a single market of 18 countries. In addition to the EU countries, it includes Iceland, Liechtenstein and Norway. EFTA

includes 

Austria, Finland, Iceland, Norway, Sweden, Switzerland and Liechtenstein. The EEA was initially established in May of 1992 and came fully into effect in January of 1994.
Table 11

Commercial Bank Supervisory Practices in the EU and G-10 Countries: 1995

Austria Belgium Denmark Finland France Germany Greece Ireland Italy Luxembourg

Components of capital for meeting the capital standards or requirements:

Noncumulative perpetual preferred

stock Yes Yes No, does not exist Yes permitted in Yes Yes Yes, no limits Yes, but limits Yes

No, issues not

domestic market

Current year profit-added (or loss

deducted) Yes Yes Yes Yes Yes No Yes Yes Yes Yes

Intangible assets other than goodwill No No No No No Yes No Yes No No, except for lease

renewal rights

Goodwill No No No No No No Yes No Yes No 3

Undisclosed reserves Yes, but limits Yes, but limits No information No No Yes, but limits No No No Yes 4

Hybrid capital instruments (including

cumulative perpetual preferred stock)

5

Yes, but limits Yes, but limits No, does not exist Yes Yes Yes, but limits Yes, but limits Yes, but limits Yes, but limits Yes

Subordinated term debt Yes, but limits Yes, but limits Yes Yes Yes Yes, but limits Yes, but limits Yes, but limits Yes, but limits Yes 6

Limited life redeemable preference Yes, but not utilized

shares at present 7 No Yes, but limits No, does not exist Not applicable Yes, but not issued No Yes, but limits No, does not exist Yes

Fixed asset revaluation 

reserves 8 Yes, but limits Yes, but limits No, does not exist Yes Yes No Yes, but limits Yes, but limits Yes, but limits No

Latent, or hidden, revaluation 

reserves 9 No No No, does not exist No No Yes, but limits No No No No

General loan loss 

reserves 10 Yes Yes No, does not exist Yes Yes Yes, but limits Yes Yes, but limits Yes, but limits Yes

Investment in the capital of other

banks and financial institutions No No No No Yes, but limits No No No No No

Examinations and/or Inspections:

On-Site Yes Yes Yes, not regularly Yes Yes Yes, on ad hoc basis Yes, usually every 3 Yes, generally every Yes, usually every Yes, usually every 

years 2- 3 years 18-24 months 4-8 years

Banks pay exam Yes No Yes Yes No information Yes No No No Yes

External audits:

Required external audits Yes Yes Yes Yes Yes Yes Yes Yes quoted on the stock Yes

Yes, for banks

exchange
Table 11 (continued)

Netherlands Portugal Spain Sweden Canada Japan Switzerland U.S. United

Kingdom

Components of capital for meeting the capital standards or requirements:

Noncumulative perpetual preferred

stock Yes Yes Yes Yes Yes Yes Yes Yes, no limits. Yes

Current year profit-added (or loss

deducted) Yes Yes No Yes Yes 11 Yes Yes Yes Yes

Intangible assets other than goodwill Yes Yes No No No Yes Yes No No, with limited

exceptions.

Goodwill Yes Yes No No No No No No No 3

Undisclosed reserves Yes No information. No No Not applicable. No No Yes, but limits. No 4

Hybrid capital instruments (including

cumulative perpetual preferred stock)

5

Yes Yes Yes, but limits. Yes with approval. Yes, but limits. Yes cumulative Yes, but limits. Yes, but not

prevalent.

Yes, but limits and

not including

perpetual preferred

stock.

Subordinated term debt Yes Yes, but limits. Yes, but limits. Yes Yes, but limits. Yes Yes Yes, but limits. Yes, but limits. 6

Limited life redeemable preference

shares 7 Yes No information. Yes, but limits. No Yes Yes Yes, but not issued. No Yes, but limits.

Fixed asset revaluation 

reserves 8 Yes Yes Yes, but limits. Yes, with approval. Yes, with caution. No No Yes, but limits. No

Latent, or hidden, revaluation

reserves 9 Yes No information. No No Not applicable. No Yes Yes, but limits. No

General loan loss 

reserves 10 Yes Yes No No Yes, but limits. No Yes Yes, no limits. Yes, but limits.

Investment in the capital of other

banks and financial institutions Yes No No No No back issues are is to raise capital No No

Yes, but back-to- No, if sole purpose

deducted. ratio.

Examinations and/or Inspections:

On-Site Yes Yes Yes, annually. Yes No Yes Yes, depends on Yes, usually Yes, but limited and

size/risk profile. annually. usually biennially.

13

Banks pay exam No No No No No, not directly. Yes No information. Yes Yes

External audits:

Required external audits Yes Yes Yes Yes Yes Yes No information. assets exceeding Yes, official part of

supervisory system.

Yes, for banks with

$500 million.
Table 11 (continued)

Austria Belgium Denmark Finland France Germany Greece Ireland Italy Luxembourg

Information publicly disclosed:

Bank Examinations or Inspections No No No No No information. No No No No No

Enforcement actions No Yes No No No information. No No No Yes No

Consumer protection laws:

Consumer protection laws exist Yes Yes Yes No information. Yes Yes Yes Yes Yes No, not specifically

for banks.

Domestic bank activities abroad:

Specific authorization required No No No No No Yes Yes Yes No No, only

notification.

Limits or restrictions placed on No, only

domestic banks’ foreign activities notification. No No No No No No No No No

Rates paid on deposits or charged on loans:

Restrictions or controls No No Yes No information. No No No No No

Yes, only on

consumer loans and

special savings

accounts.

Lending limits on:

A single borrower Yes Yes Yes Yes No information. Yes Yes Yes Yes Yes

Persons connected with the bank Yes Yes No Yes No information. No Yes Yes Yes Yes

Particular sectors No No No Yes No information. No No No Yes No

Country risk exposure No No No Yes No information. No No No No No

Large exposures Yes Yes Yes Yes No information. Yes Yes Yes Yes Yes
Table 11 (continued)

Netherlands Portugal Spain Sweden Canada Japan Switzerland U.S. United 

Kingdom

Information publicly disclosed:

Bank Examinations or Inspections No No No No No No No information. No No

Enforcement actions No Yes No No explicitly naming No No information. No Yes

Yes, but not

institutions.

Consumer protection laws:

Consumer protection laws exist Yes Yes Yes Yes No Yes No information. No Yes

Domestic bank activities abroad:

Specific authorization required No Yes branches outside No No No No information. No

Yes, but only

EU.

2 No, only

notification.

Limits or restrictions placed on

domestic banks’ foreign activities Yes No No No No No No information. No Yes 2

Rates paid on deposits or charged on loans:

Restrictions or controls No No No No No No relatively minor particularly

No, with few Yes, but not

exceptions. confining.

Yes, but only on

consumer loans.

Lending limits on:

A single borrower Yes Yes Yes Yes Yes Yes Yes Yes Yes 1

Persons connected with the bank Yes Yes Yes No Yes Yes No information. Yes Yes 1

Particular sectors Yes No No Yes No No No information. No No 12

Country risk exposure Yes No No No No No No information. requirements per No 12

No, but provision

country.

Large exposures Yes Yes No Yes Yes Yes No information. Yes No 1

SOURCE: Supervisory authorities in the listed countries provided information used to prepare this table. However, they are not responsible for any errors or misinterpretations. For exact information one must consult the pertinent laws and regulations in the ind ividual countries.

Board of Governors of the Federal Reserve System and Secretary of the Department of the Treasury (1992) was a source for France and Japan. Also, in the case of France, a source was U.S. General Accounting Office (1995).

NOTES: (1) Explicitly or implicitly, in relation to the size of the bank’s capital base. 

(2) However, does depend on nature and circumstances of the bank and country involved.

(3) Goodwill is an intangible asset.

(4) Undisclosed reserves are portions of accumulated after-tax retained earnings not identified in the published balance sheet or otherwise disclosed, except to banking supervisors. 

(5) Hybrid-capital instruments including cumulative preferred stock are instruments that combine the characteristics of equity capital and of debt, and should meet the following requirements: unsecured, subordinated, and fully paid-up; not redeemable at the

initiative 

of the holder or without prior consent of supervisory authority; available to participate in losses without the bank being obliged to cease trading (unlike conventional subordinated debt); and all service obligations to be deferred where the profitability of the bank

would 

not support payment.

(6) Subordinated term debt is normally not available to participate in losses of a bank that continues operating (included in capital only if minimum original maturity of five years).

(7) Limited life redeemable preference shares are the same as immediately above.

(8) Fixed asset revaluation reserves represent a formal revaluation, carried through to the balance sheet, of a bank’s own premises.

(9) Latent, or hidden, revaluation reserves are the difference between the market value and historic cost book value of long-term holdings of equity securities.

(10) General loan loss reserves are reserves that are held against future and presently unidentified losses and are freely available to meet losses that may subsequently materialize.

(11) If profits have been verified by an external audit.

(12) Lending limits as such are not set; however, in determining appropriate capital adequacy ratios for each institution, the supervisory authority would have regard, inter alia, to the degree of concentration in the institution’s asset profile.

(13) In Switzerland, on-site examinations are conducted solely through external auditors as an official part of the supervisory system, not through the Federal Banking Commission itself.

EXPLANATION: The Basle Committee on Banking Supervision (comprised of representatives of the central banks and supervisory authorities from the G-10 countries and Luxembourg) adopted the Basle Accord in July 1988. The Basle Accord is non-compulsory and applies

 only to internationally active banks. It is composed of four basic elements: (1) an agreed upon definition of Tier 1 (or core) capital, consisting primarily of common stockholders’ equity and noncumulative perpetual preferred stock; (2) additional compon ents of

capital, 

constituting Tier 2 capital; (3) a general framework for assigning assets and off-balance sheet items to broad risk categories and procedures for calculating a risk-based capital ratio; and (4) a schedule for achieving, by not later than the end of 1992, a minimum ratio

of 

total capital (Tier 1 plus Tier 2) to risk-weighted assets of eight percent (of which at least 4 percent should be in the form of core capital). 

 The EU issued two primary Directives addressing capital standards: the Own Funds and Solvency Ratio Directives, which were adopted in April 1989 and December 1989, respectively. These Directives have the force of law and apply to all banks
incorporated 

in the member states. Banks were required to meet a minimum eight percent risk-weighted capital ratio by January 1, 1993. The EC Directives refer to “original own funds” and “additional own funds” rather than to Tier 1 (core) capital and Tier 2 (suppleme ntal)

capital. 

However, these differences in terminology have no substantive effect.

 The Basle Accord and the EC Directives do not provide for identical minimum capital standards for banks.
Table 12

Selected Supervisory and Deposit-Insurance Scheme Information for EU and G-10 Countries: 1995

Country Bank Supervisor On-Site Examinations Banks Pay for Public Disclosure of Deposit Insurance Deposit- Insurance Coverage Per Capita GNP

Examinations Enforcement Actions Scheme Scheme USD USD

Administration of Funding for 1993

Austria Federal Ministry of Finance Yes Yes No Industry Ex post 25,791 23,835

Belgium Banking and Finance Commission Yes No Yes Government/Industry Jointly Ex ante, but banks may 19,608 21,559

have to contribute ex

post as well.

Canada Office of the Superintendent of Yes, annually. Yes No Government Ex ante 43,719 20,101

Financial Institutions

Denmark Danish Financial Supervisory Yes, usually every 3 years. Yes No Government Ex ante 53,552 27,800

Authority

Finland Financial Supervision Yes, but no regular schedule. Yes No Industry Ex ante NA 19,438

France Credit Institutions Committee, Yes No Information. No Information. Industry Ex post 80,136 22,324

Bank Regulatory Committee and

Banking Commission

Germany Federal Banking Supervisory Yes Yes No Industry Ex ante, but banks may NA 23,537

Office have to contribute ex

post as well.

Greece Bank of Greece Yes, generally every 2-3 years. No No Government/Industry Jointly Ex ante 26,144 7,340

Ireland Central Bank of Ireland Yes, usually every 18-24 months. No No Government Ex ante 19,608 12,519

Italy Bank of Italy Yes, usually every 4-8 years. No Yes Industry Ex post 491,129 19,842

Japan Ministry of Finance and Bank of Yes No Information. No Information. Government/Industry Jointly Ex ante 106,315 31,451

Japan

Luxembourg Luxembourg Monetary Institute Yes, on an ad hoc basis. Yes No Industry Ex post 16,960 25,878

Netherlands Bank of Netherlands Yes, depends on size/risk profile. No No Government/Industry Jointly Ex post 26,144 20,546

Portugal Bank of Portugal Yes, usually annually. No Yes Government Ex ante 44,118 7,853

Spain Bank of Spain Yes No No Government/Industry Jointly Ex ante 12,030 13,674

Sweden Financial Supervisory Authority Yes No No Government Ex ante 35,047 24,579

Switzerland Swiss Federal Banking No. Yes No Industry Ex post 25,370 35,534

Commission

United Kingdom Bank of England Yes, but limited and usually Yes Yes, but not explicitly Government Ex ante 28,413 17,885

biennially. naming institutions.

United States Federal Reserve System, Federal Yes, annually. Yes Yes Government Ex ante 100,000 24,763

Deposit Insurance Corporation,

Office of the Comptroller of the

Currency, State Authorities

SOURCE: Tables 1, 2, 9 and 10.
Table 13

Summary of Prompt Corrective Action Provisions of the Federal Deposit Insurance Corporation Improvement Act of 1991

Zone Tier 1 Leverage Tangible Equity Mandatory Provisions Discretionary Provisions Total Risk-Based Tier 1 Risk-Based

Capital Capital 1 2

3 4

Well Capitalized $ 10 and $ 6 and $ 5 __

Adequately Capitalized $ 8 and $ 4 and $ 4 __ 1. No brokered deposits, except with FDIC

approval

Undercapitalized $ 6 and $ 3 and $ 3 __ 1. Suspend dividends and management fees 1. Order recapitalization

2. Require capital restoration plan 2. Restrict Inter-affiliate transactions

3. Restrict asset growth 3. Restrict deposit interest rates

4. Approval required for acquisitions, 4. Restrict certain other activities

branching, and new activities 5. Any other action that would better carry

5. No brokered deposits out prompt corrective action

Significantly < 6 or < 3 or < 3 and < 2 1. Same as for Zone 3 1. Any Zone 3 discretionary actions

Undercapitalized 2. Order recapitalization 2. Conservatorship or receivership if falls to 5

3. Restrict inter-affiliate transactions submit or implement plan or recapitalize 5

4. Restrict deposit interest rates pursuant to order 5

5. Pay of officers restricted 3. Any other Zone 5 provision, if such action

is necessary to carry out prompt corrective

action.

Critically __ __ __ # 2 1. Same as for Zone 4

Undercapitalized 2. Receiver/conservator within 90 days 5

3. Receiver if still in Zone 5 four quarters

after becoming critically undercapitalized

4. Suspend payments on subordinated debt 5

5. Restrict certain other activities

SOURCE: Board of Governors of the Federal Reserve System and Federal Deposit Insurance Corporation.

NOTES: 1. Total capital as a percentage of risk-weighted assets. Total capital consists of Tier 1 plus Tier 2 capital. Tier 1 capital consists of common stockholders’ equity, noncumulative perpetual preferred stock, and minority

interests in the equity accounts of consolidated subsidiaries (excludes goodwill and other intangible assets). Tier 2 capital consists of the allowance for loan and lease losses (up to a maximum of 1.25 percent of riskweighted assets), cumulative perpetual preferred stock, subordinated debt, and other selected capital instruments.

2. Tier 1 capital as a percentage of risk-weighted assets.

3. Tier 1 capital as a percentage of total average assets.

4. Tangible equity capital consists of Tier 1 capital plus cumulative perpetual preferred stock.

5. Not required if primary supervisor determines action would not serve purpose of prompt corrective action or if certain other conditions are met.
Table 14

Various Payment Media in Selected Industrial Countries: 1993

Belgium Canada France Germany Italy Japan Netherlands Sweden Switzerland U.K. U.S.

Notes and Coin in Circulation

$ U.S. per Inhabitant 1,164 636 749 1,511 921 3,243 1,263 1,039 2,638 455 1,272

As percentage of GDP 6.0 3.4 3.6 6.7 5.8 9.7 6.5 5.2 7.9 2.8 5.2

Cash Dispensers and ATMs

Number of Machines per 1,000,000

inhabitants 119 554 325 308 266 935 291 255 439 321 367

Number of transactions per Inhabitant 9.1 37.5 13.3 NA 4.1 3.3 20.4 28.3 8.3 20.6 29.0

Average Value of Transactions ($ U.S.) 110.3 53.5 77.0 NA 196.8 392.9 96.4 101.2 207.8 72.7 70.7

EFTPOS Terminals

Number of Terminals per 1,000,000

inhabitants 5,246 2,134 7,435 344 1,350 168 1,600 3,054 2,634 3,780 759

Number of Transactions per Inhabitant 15.60 2.60 24.30 0.85 0.39 0.005 4.40 7.20 4.00 NA 1.70

Average Value of Transactions ($ U.S.) 63.2 38.8 58.0 54.2 121.5 184.9 58.5 67.1 58.8 NA 24.0

Relative Importance of Cashless Payment Instruments

% of Total Volume of Cashless Transactions

Checks 16.0 58.7 49.1 8.3 37.2 NA 8.1 6.3 3.3 43.1 80.4

Payment Cards 16.5 31.1 15.7 2.6 4.1 NA 4.1 11.6 13.8 20.8 16.7

Credit Transfers 58.5 5.2 15.4 46.5 44.6 NA 66.4 77.1 80.1 20.4 1.9

Direct Debits 9.0 5.0 10.6 42.6 4.4 NA 21.5 5.0 2.8 15.6 1.0

% of Total Value of Cashless Transactions

Checks 5.4 98.8 4.6 2.3 5.4 NA 0.1 7.2 0.1 9.4 12.6

Payment Cards 0.1 0.3 0.2 0.0 0.0 NA 0.0 0.9 NA 0.2 0.1

Credit Transfers 94.2 0.7 93.5 95.7 93.2 NA 98.8 88.8 99.9 89.5 86.2

Direct Debits 0.3 0.2 0.7 2.0 0.2 NA 1.1 3.1 NA 0.9 1.0

SOURCE: Bank for International Settlements (1994).
0 2 4 6 8 10 12 14 16 

Greece

Italy

Portugal

Spain

Japan

Luxembourg

France

Ireland

Belgium

Germany

Austria

United Kingdom

Denmark

Netherlands

Canada

Switzerland

Sweden

United States

Finland

0.39

0.52

0.61

0.73

0.78

1.57

1.62

1.75

1.86

2.58

3.77

4.17

5.02

5.88

6.57

7.49

8.95

12.42

14.16

Figure 1

Potential for Electronic Banking?

(Internet Hosts per 1,000 Inhabitants)*

January 1995

* In this case, Internet Hosts refer to personal computers that support the Internet.

SOURCE: Organization for Economic Co-operation and Development (1996).
Table 15

Domestic and Foreign Activities of Selected U.S. Bank Holding Companies: 1993

Total Assets Total Deposits Total Revenue Total Net Income Total Employees Total Assets

Memo: 

of Lead Bank

Millions foreign Millions offices Millions foreign Millions foreign Millions

of USD country of USD outside the of USD country of USD country of USD

Percent Percent in Percent Percent

related U.S. related related

Number outside the

Percent

U.S.

Citicorp

(operates in 93 228,240 51 145,089 64 16,075 50 2,219 70 81,500 53

countries)

Citibank

169,142

Chemical 149,888 24 98,277 23 12,427 27 1,604 36 41,567 N.A. Chemical Bank

113,002

J. P. Morgan 133,888 45 40,402 82 11,941 82 1,586 75 15,193 41 Guarantee

Morgan

95,732

Chase 102,677 34 71,509 43 6,812 89 966 32 34,390 25 Chase Bank

84,003

Bankers Trust 92,082 46* 22,776 55 7,800 57 955 87* 13,571 39 Bankers Trust

57,932

First Chicago 52,560 16 28,186 27 4,826 14 804 11 17,118 N.A. Bank

First National

34,491

SOURCE: Annual reports from bank holding companies.

NOTE: See annual reports for information about the allocation between domestic and foreign. * Before intersegment eliminations of $12,356 millions.
Table 16

U.S. Banking Presence Abroad: 1993

Year

Number of Offices Assets (billions of USD)

Subsidiaries Percent Branches Percent Total Percent Subsidiaries Percent Branches Percent Total Percent

Belgium 8 1.3 4 0.6 12 0.9 2.5 1.1 9.8 2.6 12.3 20.0

France 16 2.5 8 1.1 24 1.8 6.7 2.9 11.3 3.0 18.0 2.9

Germany 14 2.2 8 1.1 22 1.6 29.0 12.3 1.8 0.5 30.8 5.0

Greece 5 0.8 24 3.3 29 2.1 0.3 0.1 2.6 0.7 2.9 0.5

Italy 13 2.0 11 1.5 24 1.8 2.3 1.0 8.7 2.3 11.0 1.8

Luxembourg 12 1.9 0 0.0 12 0.9 5.7 2.4 0.0 0.0 5.7 0.9

Netherlands 5 0.8 2 0.3 7 0.5 0.6 0.3 1.9 0.5 2.5 0.4

Spain 11 1.7 11 1.5 22 1.6 6.5 2.8 9.0 2.4 15.5 2.5

Switzerland 14 2.2 6 0.8 20 1.5 7.9 3.4 1.7 0.4 9.6 1.6

U.K. 95 14.9 33 0.8 128 9.4 72.6 30.9 109.8 29.0 182.0 29.7

Other Europe 20 3.1 11 1.5 31 2.3 7.8 3.3 2.8 0.7 10.6 1.7

Total Europe 213 33.4 118 16.3 331 24.3 141.9 60.4 159.4 42.1 301.0 49.1

Canada 18 2.8 0 0.0 18 1.3 12.0 5.1 0.0 0.0 12.0 2.0

Japan 13 2.0 40 5.5 53 3.9 2.3 1.0 18.0 4.8 20.3 3.3

All other 393 61.7 566 78.2 959 70.5 78.7 33.5 201.3 53.2 280.0 45.6

Grand Total 637 100.0 724 100.0 136 100.0 234.9 100.0 378.7 100.0 614.0 100.0

SOURCE: Office of the Comptroller of the Currency.

NOTES: Data for subsidiaries based on annual FR2314 reports submitted to the Federal Reserve System by foreign subsidiaries of Federal Reserve System member banks. Subsidiaries include 

 only those with greater than $1 million in total assets. Data for branches based on annual FFIEC 030 reports of foreign branches of Federal Reserve System.
Table 17

Foreign Banking Presence in the U.S.: 1993

Year

Number of Offices Assets (billions of USD)

Subsidiaries Percent Branches Percent Total Percent Subsidiaries Percent Branches Percent Total Percent

Austria 0 0.0 4 0.7 4 0.6 0.0 0.0 3.7 0.5 3.7 0.4

Belgium 0 0.0 4 0.7 4 0.6 0.0 0.0 4.9 0.7 4.9 0.5

Denmark 1 0.9 2 0.4 3 0.5 0.2 0.1 2.3 0.3 2.5 0.3

Finland 1 0.9 4 0.7 5 0.8 0.0 0.0 6.8 1.0 6.9 0.8

France 2 1.8 30 5.5 32 4.9 4.9 2.3 80.7 11.6 85.7 9.4

Germany 0 0.0 21 3.9 21 3.2 0.0 0.0 34.8 5.0 34.8 3.8

Greece 1 0.9 2 0.4 3 0.5 0.9 0.4 0.2 0.0 1.1 0.1

Ireland 0 0.0 2 0.4 2 0.3 0.0 0.0 0.3 0.0 0.3 0.0

Italy 1 0.9 24 4.4 25 3.8 1.2 0.6 37.5 5.4 38.7 4.2

Luxembourg 0 0.0 0 0.0 0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Netherlands 9 7.9 11 2.0 20 3.0 18.3 8.5 17.3 2.5 35.6 3.9

Portugal 0 0.0 4 0.7 4 0.6 0.0 0.0 2.1 0.3 2.1 0.2

Spain 9 7.9 13 2.4 22 3.4 11.2 5.2 7.1 1.0 18.3 2.0

Sweden 2 1.8 4 0.7 6 0.9 0.7 0.3 8.4 1.2 9.1 1.0

U.K. 5 4.4 36 6.6 41 6.3 42.8 19.9 29.9 4.3 72.7 8.0

Total EU 31 27.2 161 29.7 192 29.3 80.2 37.3 236.1 33.8 316.2 34.6

Switzerland 0 0.0 14 2.6 14 2.1 0.0 0.0 42.0 6.0 42.0 4.6

Canada 19 16.7 18 3.3 37 5.6 14.3 6.7 45.7 6.5 60.0 6.6

Japan 22 19.3 122 22.5 144 22.0 64.4 30.0 321.6 46.0 386.0 42.3

All other 42 36.8 241 44.5 283 43.1 55.9 26.0 95.1 13.6 151.0 16.5

Grand Total 114 100.0 542 100.0 656 100.0 214.8 100.0 698.5 100.0 913.3 100.0

SOURCE: Office of the Comptroller of the Currency.

NOTES: Subsidiaries include separately capitalized banks at least 25 percent foreign owned. Assets of offshore branches managed or controlled by U.S. - based branches not included.