The Banking Regulation’s Shifts in Light of Globalization and its Effect on the Banking Industry’s Performance: U.S.A. as a Model

Banking regulation is essential for the efficient functioning of banking activities and the optimal allocation of financial resources. It also plays a critical role in ensuring financial stability and safeguarding depositors by preventing banks from taking excessive risks and ensuring they maintain adequate liquidity to meet their obligations. These measures contribute to the development of the banking sector and enable banks to finance economic growth. This study seeks to examine the transformations in banking regulation over recent decades and their impact on the performance of the banking sector, focusing on the United States as a case study. To achieve this objective, a descriptive method was employed. The study found that banking regulation in the United States has undergone significant transformations, shifting from liberalization to increased restrictions. The global financial crisis of 2008 prompted regulators to tighten their frameworks, which, while initially having a slight negative impact on profitability, ultimately had a significant positive effect on the resilience of banks.