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The article discusses the enforcement actions by financial institution supervisors following the enactment of the Financial Institutions Reform Recovery and Enforcement Act (FIRREA) and Federal Deposit Insurance Corporation Improvement Act (FDICIA) in the U.S. Among the powers added to supervisors under the measures are their ability to require changes in financial institution management and suspend dividends. Cited here are several concerns that have emerged in relation to FIRREA and FDICIA.

The article looks at the management and reorganization of the Charles Schwab brokerage company as of July 2004. Fed up with falling margins and market share, the board of Charles Schwab, one of America's largest discount brokerages, ousted David Pottruck, the chief executive, on July 20th. His replacement will be none other than Charles Schwab, the firm's founder. Schwab's woes predate the solo reign of Pottruck, who was joint chief executive with Schwab from 1998 to 2003 (since when Schwab has remained chairman). The firm has strayed too far from its founding notion of cutting rates and wooing clients away from full-service firms such as Merrill Lynch, which worked well for much of Schwab's 30-year history. In 2003, hoping to break into institutional trading and research, the company took over part of Soundview, an investment bank. So the company now occupies an uneasy middle ground: dearer than its discount rivals (until recent price cuts, Schwab's charges were three times Ameritrade's) and offering less service than the likes of Merrill Lynch. Schwab may find that turning a firm around is harder than starting one up.

The article focuses on Senate Banking chairman Christopher J. Dodd's draft legislation in the U.S. It notes that Dodd's plan will present several obstacles to overcome for the financial industry regulations overhaul. It mentions that the draft would establish a single federal banking regulator and a new agency to detect risks to the financial system. It adds that the plan would move the authority for regulating banks into a single agency, the Financial Institutions Regulatory Administration.

Editorial. Comments on the efforts of the Government Finance Officers Association to promote professional management of governmental financial resources in the United States. Identification, development and advancement of fiscal strategies, policies and practices; Development of publications and training programs; Development of recommended practices.

This article highlights increasing pressure on brokerages and other financial services firms in the U.S. to define and test their information technology (IT) disaster recovery plans as of May 2004. Wall Street firms are also being pushed by the federal government and regulators to consider moving their backup data centers farther away from their primary computing facilities. A combination of peer pressure and regulatory pressure is prodding companies to ensure that their systems will keep running if a disaster occurs. Nasdaq announced two weeks ago that it had run tests at its two data centers to check the disaster recovery capabilities of member companies. The tests involved more than 50 brokerages and were conducted at the exchange's primary data center in Connecticut in February 2004 and at its backup facility in Maryland in April 2004. Large financial services firms also face an April 2006 deadline for meeting new federal guidelines on increased resiliency for trade clearance and settlement activities. The Securities and Exchange Commission, the Federal Reserve Board and the Treasury Department's Office of the Comptroller of the Currency set the guidelines in spring 2004.