Learning Objectives:
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Compare banking system structures in major economies.
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Understand the unique features of the US, EU, and UK banking systems.
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Identify common features of banking in emerging markets.
5.1 Key Learning Outcomes
The University of Edinburgh course requires students to “compare the structures of banking systems between different economies” and “explain the structures of banking industries” . This comparative understanding is essential for commercial banking professionals.
5.2 The US Banking System
The U.S. banking system is characterized by a multi-layered regulatory framework and a diverse range of institutions . Commercial banks in the U.S. operate under charters issued by either the federal government or a state government, and they are regulated by the Federal Reserve, the Office of the Comptroller of the Currency (OCC), or state banking regulators depending on their charter type . The U.S. system includes community banks (under $1 billion in assets), regional banks ($1 billion to $100 billion), and large national banks (over $100 billion) .
5.3 The European Banking System
The University of Edinburgh course covers the “structure of the EU banking industry, deregulation, developments in retail banking, technological developments” and “structural features of new EU member states” . The EU banking system has been shaped by deregulation and the creation of the European Banking Union.
5.4 The UK Banking System
The structure and performance of the UK banking industry, including the UK payments system, is a key topic in the University of Edinburgh course . UK banking is characterized by a small number of large clearing banks and a wide range of specialised institutions.
5.5 Emerging Markets
The University of Edinburgh course covers “structural features of banking in emerging and transition economies, bank crises” . Emerging market banking systems face unique challenges, including higher volatility, less developed regulatory frameworks, and greater vulnerability to financial crises.