Monday, August 31, 2009

Too Bigger To Fail


The commercial banking industry had already gone through extensive consolidation, with a group of four superbanks and 6-10 additional challengers dominating the industry. Now, the remaining three superbanks strongly dominate the market space for deposits, mortgages and other retail products.


This is a serious problem for the stability of the banking system as a whole, and results in substantial pricing power against the retail customer base. The big guys need to be put on a diet, and soon.

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