Financial and Mortgage Services Industry Essay Example | Topics and Well Written Essays - 1500 words

Financial and Mortgage Services Industry - strive ExampleFurther more it forget give us an external environment overview of the st rungic tools used to see to it market growth or decline, business position, potential and direction for operations.The Basel II Regulations are expected to determine the entire m onenesstary services industry by creating new classes of competitors based on their risk-measurement and value-measurement technologies. These guidelines pose respectable threats to both real estate lending by commercial banks and the viability of the entire industry since higher crown charges could reduce available capital for commercial real estate. 5Sarbanes-Oxley developed a private, nonprofit corporation, to ensure that financial statements are audited according to independent standards. It also holds chief executives and chief financial officers directly responsible for the trueness of financial statements. The law seeks to rule out conflicts that would make securit ies analysts less than objective and gives board audit committees instead than CEOs or chief financial officers full control of auditors. 3The new regulations for mutual funds to have 75% independents in the board of directors and have an independent mutual fund chairman of the board represent one of the most drastic changes. These rules will require the search and hiring of new members to meet the regulations as a result, a shortage of potential candidates may be experienced. These regulations can be good or bad for a company depending on the quality of decisions taken at the time of appointing new directors and chairperson. 7Hedge Funds RegulationsWith the change magnitude growth of hedge funds in the market, the regulations to monitor them are becoming more practical in the near future. 6Regulations for New EntrantsSome regulations regarding the minimum capital requirements for a company act as a barrier to new firms trying to enter the industry. Along with this investment and technological input costs are difficult to meet for these new entrants. 6 Economic Forces Federal Interest Rate HikesThe changing of the fund invest has the most impact on short-term rates. The raising or lowering of this rate will bear on interest rates on mortgages, credit batting orders, and home equity lines of credit. When the target rate is raised, consumers pay more interest. When the rate is lowered, they pay less. These rate hikes will also affect credit cards since credit card interest rates are tied to the prime rate, which is subject to the actions of the Fed. As the rate increases tend come upon slowly to credit cards because issuers re-price cards once a quarter, the rate increase will be seen in the near future. 8Declining Personal Savings RateIn September 2005, the personal saving rate as a percentage of disposable income was negative implying US consumers spent more than 100% of their periodic post-tax income. This decline in savings can be bad for the economy as there will be lesser investment and the financial sector can suffer. 4Compliance Costs for Small FirmsU.S. businesses