This act was desired by most of the largest banks, brokerages, and insurance companies in the country at the time. The justification was that people usually put more money in investments in a good economy, but when it turns bad, they put their money into savings accounts. With the new act, they would do both with the same company, so the company would be doing well in all economic times. This has to some extent proven out.

Senator Phil Gramm led the Senate Banking Committee which sponsored the bill for the act; he later joined UBS Warburg, the U.S. investment arm of the largest Swiss bank.

Some restrictions remain to provide some amount of separation between the investment and commercial banking operations of a company. For example, the commercial banks aren't allowed to pay commission to their employees who convince customers to also use some investment services. They are only allowed to pay them a small fee for simply setting up appointments to meet with a fincancial advisor.