beyond strongfinancestrong permissible commercial activities of u.s..pdfVIP

Cornell Law Library Scholarship@Cornell Law: A Digital Repository Cornell Law Fa ulty Publications Fa ulty Scholarship 11-12-2013 Beyond Finance: Permissible Commercial Activities of U.S. Financial Holding Companies Saule T. Omarova Cornell Law School Follow this and additional works at : http://scholarship.law. /fa pub Part of the Banking and Finan e Commons, and the Commer ial Law Commons Re ommended Citation Omarova, Saule T., Beyond Finan e: Permissible Commer ial Activities of U.S. Finan ial Holding Companies (2013). Cornell Law Faculty P ublications. Paper 1003. http://scholarship.law. /fa pub/1003 This Article is brought to you for free and open a ess by the Fa ulty Scholarship at Scholarship@Cornell Law : A Digital Repository. It has been a epted for inclusion in Cornell Law Fa ulty Publications by an authorized administrator of Scholarship@Cornell Law : A Digital Repository. For more information, please ontact jmp8@ . BEYOND FINANCE: PERMISSIBLE COMMERCIAL ACTIVITIES OF U.S. FINANCIAL HOLDING COMPANIES S T. O is essay explains the legal basis for, and examines public policy implications of, recent expansion of large U.S. nancial holding companies’ non-nancial business activities. Despite its potentially signicant impact on economic growth and systemic stability, this phenomenon of nancial conglomeration beyond nance remains poor- ly understood. Yet, any truly comprehensive and eective reform of nancial services regulation must address public policy issues that arise when “too-big-to-fail” banks grow even bigger and more systemically signicant by combining nance with com- merce. I. e Legal Wall Between Banking Commerce One of the foundational principles underlying the entire system of U.S. bank regu- lation is the principle of separating banking from general commerce. Since at least 1863,