Effective October 3, 2011, the Banking Department and the New York State Insurance Department will soon merge to become the New York State Department of Financial Services (DFS). A press release from the New York State Banking Department states: “Integrating these agencies under a single leadership and management structure will allow for greater efficiency and will help modernize regulatory oversight of the financial services industry.”
Historically, the separate banking and insurance departments of the State of New York have respected their own separate jurisdictional limits relative to their separate licensing, regulatory, and enforcement initiative designed to protect the interests of bank customers and insurance policyholders. With the emergence of banking, insurance, and financial conglomerates and their multiple cross-offerings of banking, securities, and insurance products, the consolidation of these departments is a natural outgrowth.
Investor rights advocates welcome this consolidation as being in the interest of consumers, bank depositors, insurance policyholders and investors.