Federal financial regulation in the United States has evolved through a series of piecemeal responses to developments and crises in financial markets. This report provides an overview of current U.S. financial regulation: which agencies are responsible for which institutions and markets, and what kinds of authority they have. There are two traditional components to U.S. banking regulation: deposit insurance and adequate capital. Commercial banks accept a quid pro quo that was adopted in response to widespread bank failures during the 1930s.

The 111th Congress has taken a broad approach to capturing the lessons on financial crises as part of the effort to evaluate possibilities for revamping the U.S. financial regulatory system. Latin America stands out as one region that has survived multiple financial crises, and in the aftermath of such devastation, many countries undertook comprehensive regulatory reform. Although a smaller developing economy, Chile provides one important example.