What is a key provision of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994?

The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 facilitates the expansion of banking operations across state lines, which was a significant shift in banking regulations at that time. A key provision of this legislation is that it allows adequately capitalized banks to acquire banks in other states. This change aimed to increase competition in the banking industry by enabling banks to grow and diversify their operations beyond their home states, effectively promoting efficiency and consumer choice.

By permitting interstate acquisitions, the act helped to create a more integrated national banking system. It also endorsed the establishment of branch banks in other states, leading to a more interconnected financial landscape, which is beneficial for both banks and their customers. This was part of a broader trend towards deregulation in the banking sector, opening up new opportunities for banks to consolidate and expand their reach.

The other options, while relevant in the context of banking regulations, do not capture the core intent of the Riegle-Neal Act. For example, imposing limits on interstate commerce contradicts the aim of greater interstate banking flexibility. Similarly, while capital requirements and insurance policies are crucial for bank stability and consumer protection, they are not the primary focus of this particular piece of legislation.