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Economic Commentary

Banking and Commerce: To Mix or Not to Mix?

In the late 1970s, commercial banks and thrifts experienced an unprecedented diversion of their funds to less regulated institutions. Partly in reaction to this massive outflow of depositories’ funds, the U.S. Congress passed two separate, fairly comprehensive deregulatory measures-the Depository Institutions Deregulation and Monetary Control Act of 1980 and the Garn- St Germain Depository Institutions Act of 1982. Because of these two acts, banks and thrift institutions can more freely pay whatever interest rates they choose in order to attract deposit funds.

The views authors express in Economic Commentary are theirs and not necessarily those of the Federal Reserve Bank of Cleveland or the Board of Governors of the Federal Reserve System. The series editor is Tasia Hane. This paper and its data are subject to revision; please visit for updates.

Suggested Citation

Buynak, Thomas M. 1983. “Banking and Commerce: To Mix or Not to Mix?” Federal Reserve Bank of Cleveland, Economic Commentary 12/5/1983.

This work by Federal Reserve Bank of Cleveland is licensed under Creative Commons Attribution-NonCommercial 4.0 International