Gramm-Leach-Bliley Act
About Gramm-Leach-Bliley Act
The Gramm-Leach-Bliley Act of 1999 repealed the Glass-Steagall separation of commercial and investment banking. The act allowed the creation of financial conglomerates combining banking, securities, and insurance. Citigroup, formed by the merger of Citicorp and Travelers, was the test case that pushed for the repeal. Supporters argued it would make US banks more competitive globally. Critics argued it created too big to fail institutions that took excessive risks. The act contributed to the 2008 financial crisis by allowing banks to combine deposit taking with risky trading. The Dodd-Frank Act of 2010 imposed new restrictions but did not fully restore Glass-Steagall.
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