Details on Financial and Securities Regulation
The oversight of financial markets and companies is offered by the financial and securities regulatory agencies, which are government functional bodies. These agencies are mandated to take up different roles and responsibilities. Notably, they work independently despite some having similar objectives. The existence of the agencies is indefinite despite their attraction of criticism on their efficiency. The several functions of the regulatory agencies appear in the text below.
Boosting the economy
The stimulation of the economy through influencing overall credit conditions, liquidity and money is the function of some financial and security agencies. There is the application of tools that regulate the disposal and acquisition of treasury and agency securities by the agencies. The agencies foster the stability of the banking system through regulating that interest rates and supervising the banking system.
Issuing Insurance on Deposits
The protection of bank deposits of individuals and entities is offered by some entities. This insurance ensures that a depositor does not lose their money in case of any eventuality. There is usually a cap on a number of deposits that the insurance covers per person or entity.
There is always a need to ensure that banks operate competitively. It means that there should be a regulatory agency that oversees the provision of charters to the banks. Such an agency has the main objective that entails the maintenance of a solid banking system; a process that includes supervision, regulation and provision of bank charters. The agencies also facilitate efficient banking as well as financial services.
Controlling Sale of Securities to the Public
Some agencies ensure that members of the public trade in securities efficiently. These agencies bridge the gap between the customers and brokers. Training, licensing and testing financial professionals are the main duties of the agencies. In addition, they act as mediators and arbitrators when customers and brokers have disagreements.
The agencies monitor, review and oversee the operations of the insurance industry. There is monitoring, reviewing and overseeing the operations of the insurance industry by the agencies. Consumer protection, investigations on criminal activities, and law enforcement are some of the activities that the agencies carry out in their main objective of sanitizing the insurance industry. Notably, these agencies act when representing the state.
Administer Securities Law
The agencies that enforce the securities laws act independently from governments. They are some of the most powerful and comprehensive agencies. They have oversight over stocks and options exchanges, options markets, and electronic exchanges and securities.
Even though people do not deal directly with financial and securities agencies, they usually feel the impact of the regulations indirectly. The impact is felt most on the instance of liquidity, credit markets and interest rates adjustments. It shows that the effects of the agencies indirectly affect a common person.
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