Question

Which of the following repealed the 1933 Glass-Steagall barriers between commercial banking, insurance, and investment banking?

		Financial Institutions Reform Recovery and Enforcement Act (1989).
		Competitive Equality in Banking Act (1987).
		Garn-St. Germain Depository Institutions Act (1982).
		The Bank Holding Company Act (1956).
		Financial Services Modernization Act (1999).

Answer 1

In 1933, Glass-Steagall Act was passed which has seperated commercial banking and investment banking as they beleived that commercial banks are involved in investment banking and the proposition is risky. So, banks can choose either commercial or investment banking.

As the banking industry matured and in consultation with the industry in 1999, The Gramm-Leach-Bliley Act repealed the 1933 Glass-Steagall act thus removing all the restrictions. Thsi act is also famously known as Financial services modernization act, 1999.