International Banking Act of 1978

The International Banking Act of 1978 was a piece of U.S. legislation, laying down the law that says all American banks and agencies of foreign banks in the U.S. now must play by the rules of U.S. bank regulations.

If you’re a bank and you want to play ball in the U.S., you’ve now gotta play by the rules. The FDIC start providing insurance to these banks, and the banks had to follow reserve requirements and accounting procedures.

Before the International Banking Act of 1978, it was the wild, wild west in the banking realm, with different states and regions with their own banking rules. With foreign banks popping up like daisies in the U.S. in the 1970s, pressure grew to regulate these newcomers operating banks.