Practical and Helpful Tips: Finances

Details on Financial and Securities Regulation

The financial and securities regulatory agencies are government functional bodies that provide oversight on financial markets as well as companies. There are different roles and responsibilities that these agencies play and have respectively. They do not depend on anyone when they are working even though their objectives are identical. There is criticism on the efficiency of the agencies, but their existence is indefinite. The several functions of the regulatory agencies appear in the text below.

Boosting the economy
Some financial and security agencies work to stimulate the economy through influencing overall credit conditions, money and liquidity. The tools that control the buying and selling of treasury and agency securities are applied by the agencies. There is a regulation of interest rates and supervision of the banking system by the agencies as they bring the financial system’s stability.

Providing Insurance on Deposits
There are agencies that offer protection on individual’s and entities’ bank deposits. The insurance indemnifies the depositor against any loss of their money when an eventuality happens. There is usually a cap on a number of deposits that the insurance covers per person or entity.
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Controlling Currency
It is necessary to ensure that there is competition between banks. It means that there should be a regulatory agency that oversees the provision of charters to the banks. The maintenance of a sound banking system is the main objective of such an agency, and it achieves it through provision, regulation and supervision of bank charters. It is also the duty of the agencies to aid in the provision of efficient banking and financial services.
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Oversight on Securities that are For Sale to the Public
Some agencies foster efficiency when members of public want to trade in securities. These agencies act as a bridge between customers and brokers. The main roles of the agencies is to train, license and test financial professionals. On top of that, they provide mediation and arbitration on matters concerning the customers and brokers.

Supervising Insurance
The operations of the insurance industry are monitored, reviewed and overseen by the agencies. There is monitoring, reviewing and overseeing the operations of the insurance industry by the agencies. Their main objective is to offer consumer protection, carry out criminal investigations, and enforce legal actions, among other activities that bring sanity in the insurance industry. Notably, these agencies act on behalf of the state.

Enforce Securities Law
The agencies act independently from governments while enforcing the law. They are some of the most powerful and comprehensive agencies. Their coverage extends over stocks exchanges, options exchanges, options markets and electronic securities and exchanges markets.

Even though people do not deal directly with financial and securities agencies, they usually feel the impact of the regulations indirectly. Some of the areas that make the impact to be felt most include liquidity, credit markets and interest rates application. It translates into an indirect effect on a common person by the agencies.