Text 3 financial law: bank reforms

Exercise 3.1 Study the vocabulary:

sweeping	1) широкий, швидкий
bailout	2) виведення з кризи
oversight	3) контроль
derivatives	4) деривативи, вторинні цінні папери
to wind down	5) поступово зникати
Department of Treasury	6) міністерство фінансів (США)
to undertake	7) гарантувати
credit rating	8) оцінка кредитоспроможности
to verify	9) перевіряти; підтверджувати
tight	10) вимогливий, суворий
to disclose	11) виявляти
а debt	12) борг
interest rate	13) відсоткова ставка
requirement	14) вимога

Exercise 3.2 Read and translate the text:

In 2010, Congress made sweeping changes to financial regulation when it passed the Dodd-Frank Wall Street Reform and Consumer Protection Act. The bill was inspired by the mortgage crisis, bank bailouts and reports of unfair practices in the credit card industry.

The key portions of the bill will initiate several changes to the financial system. These changes will: consolidate federal agencies and create an oversight council to monitor and react to instability in the market; increase transparency in the regulation of derivatives including a requirement that they be traded on exchanges; and prevent banks from making speculative investments that can end up hurting consumers.

The Dodd-Frank Act also adds new international standards to improve coordination on accounting and lender procedures, and creates new rules for winding down bankrupt businesses in a way that minimizes impact on the overall economy. This includes giving the Department of Treasury the authority to undertake emergency lending if necessary.

Comprehensive consumer protection measures are also included in the Dodd-Frank Act. These measures regulate the activity of credit rating agencies and credit card companies. Credit rating agencies have to verify information before including the information in reports, and tighter restrictions control how that information can be sold or provided to employers. Credit card companies must disclose interest rates and true costs of debt to consumers, and they can no longer arbitrarily raise interest rates.

Exercise 3.3 Decide if the statements are true or false:

1. In 2001, Congress made sweeping changes to financial regulation when it passed the Dodd-Frank Wall Street Reform and Consumer Protection Act.

2. The key portions of the bill will initiate several changes to the financial system.

3. The Dodd-Frank Act adds new international standards to improve coordination on accounting and lender procedures.

4. The Dodd-Frank Act creates new rules for winding down bankrupt businesses in a way that minimizes impact on the overall legal system.

5. The Department of Treasury is given the authority to undertake emergency lending if necessary.

6. Comprehensive consumer protection measures are included in the Dodd-Frank Act.

7. These measures regulate the activity of banks and corporations.

8. Credit rating agencies have to verify information before including the information in reports.

9. Credit card companies must disclose all financial information to consumers.

Exercise 3.4 Read the text and fill in the gaps:

1. The bill was inspired by the …, … and reports of unfair practices in the credit card industry.

2. The key portions of the bill will initiate several changes to the ….

3. These changes will create an oversight council to monitor and react to ….

4. These changes will increase transparency in the regulation of … including a requirement that they be traded on exchanges.

5. These changes will also prevent banks from making speculative … that can end up hurting ….

6. Comprehensive … measures are also included in the Dodd-Frank Act.

7. Credit rating agencies have to verify information and tighter … control how that information can be sold or provided to ….

Exercise 3.5 Match the term with its definition:

Bailout	place where merchants, bankers, etc. transact business
Derivatives	to make or become better by the removal of faults and errors
Regulation	something demanded or imposed as an obligation
To reform	a financial instrument whose value is based on another security
Requirement	a principle, rule, or law designed to control or govern conduct
Oversight	a rescue from financial difficulties
Exchange	strong effect or impression
Bank	failure to do or notice something; supervision
Impact	a regulation or limitation
Restriction	establishment for depositing, withdrawing, and borrowing money

Exercise 3.6 Replace the following words translating them into English:

1. Законопроект was inspired by the mortgage crisis.

2. The key portions of the bill will initiate several changes to the фінансової системи.

3. These changes will зміцнить federal agencies and create an oversight council to monitor and react to нестабільність на ринку.

4. The Dodd-Frank Act also adds new international standards to improve coordination on accounting and процедури кредитування.

5. Credit rating agencies have to verify information before включенням інформації in reports.

6. Credit card companies must disclose відсоткові ставки and true costs of боргу to consumers, and they can no longer довільно піднімати interest rates.