Posted on 07/29/2015 5:26:37 AM PDT by Citizen Zed
The U.S. excels at startups, but here's something America isn't starting up these days: banks.
Only three new banks have opened in the United States since 2010.
Before the financial crisis, over 100 banks set up shop each year, on average, according to data from the Federal Deposit Insurance Corporation, the agency that approves new banks.
New banks are supposed to be a sign of a healthy economy -- and robust competition. Historically, they would pop up in communities that wanted more local banking options.
Apparently, that's not the case anymore. Some blame financial regulation for the drought. Dodd-Frank regulation was enacted in 2010 to prevent another crisis.
A key feature of the new rule was that banks hold more cash ("capital") at hand to deal with a crisis and to place more restrictions on lending. Both of these make it harder for banks to profit.
Banking "ain't what it used to be," according to Ernest Patrikis, a partner at law firm White and Case who spent 30 years at the New York Federal Reserve monitoring banks.
The law was meant to stop large insolvent banks from infecting the entire global financial system. However, many of the rules filtered down to small banks, too.
(Snip)
New banks since 2010
1. Start Community Bank (New Haven, CT)
2. Bank of Bird in Hand (Bird in Hand, PA)
3. Lakeside Bank (Lake Charles, LA)
*Primary Bank (Bedford, NH) has been approved but not yet opened.
(Excerpt) Read more at money.cnn.com ...
Bingo! We have a winner.
Financial disasters are often manufactured so that large financial groups can vacuum up smaller firms, and so "protective legislation" can be passed that make it near impossible to start a small financial firm.
I did some contract IT work for bank of amigo through an outfit that worse than BOA which is saying something. But that is was all there was at the time.
I detest and hate banks. I will never work for one ever. They are on par with electronics recycling and resale people who I hold in greatest contempt.
When corn prices drop, farmers shift to soybeans.
When oil and gas prices drop, investors sell their oil and gas stocks and put that money into a growing sector.
Interest rates are at record lows. Why are people so surprised that businessmen are not opening new banks???
Dodd Frank killed small banks
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