The past few weeks, make that days, have changed the face of US banking. Banks are now concentrated in 3 powerful entities: Citi, Bank of America and JP Morgan. The three biggest banks in the country are now bigger than ever, with a combined 31% of all U.S. deposits. Bank of America leads the pack with 10.99% of all U.S. deposits. J.P. Morgan trails only slightly at 10.51%. And Citigroup ranks as the only one of the big three below the 10% cap, with 9.8% of all U.S. deposits.
Now talk about too big to fail. Those banks will never be allowed to fail and they can take all the risk they want. But expect tighter regulation by the government to make them even quasi government entities.
Welcome to the Canadian banking model, where few banks monopolize the industry. Canadian have always called for deregulation to open up banking for outside competition but the government relented. The results higher fees, lousy customer service and high lending rates.
So to my friends in the US get ready for a lousy banking model.