Veel te veel banken zijn too big to fail

I was at a banking conference in Dallas over the weekend, and among the speakers was Harvey Rosenblum, the vice president and director of research at the Dallas Federal Reserve Bank. Dr. Rosenblum’s topic was too-big-to-fail banks and the Dodd-Frank legislation that is supposed to cure the problem.

There are currently 5,582 banks in the United States. That is a very great many by the standards of the rest of the world, but it’s way down from the peak number of banks, which was over 30,000 in 1920. But the total number doesn’t begin to tell the whole story. Of the total, 5,500 banks are so-called community banks, with banking assets of under $10 billion. Then there are 70 mid-size banks, with assets of between $10 billion and $250 billion. Finally, there are 12 megabanks with assets between $250 billion and $2.3 trillion.