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 ...
I think Bird in Hand, PA is right down the street from Blue Balls, PA also close to Intercourse, PA.
In the meantime, commercial and personal lending continues to migrate away from traditional banks and into online non-bank lending startups.
Has CNN Money never heard of OnDeck Capital and its brethren?
1. The Millennials don’t own homes, and never go to a brick and mortar bank. They finance their student loans online and then spend the next 30 years paying them off, while working part time at the Best Buy. They don’t have a checkbook, and they do what little banking they require online.
2. Businesses are not expanding, thus capital loans aren’t driving the banking market.
3. How are credit unions doing? I haven’t had a bank account for almost 30 years. Smart consumers use credit unions and the relaxing of membership requirements should have drained a lot of business from the banks.
4. Record numbers of Americans are just having government support direct deposited into their accounts and using EBT ‘food stamp’ cards. Not much in it for the banks on that one.
5. New banking firms may not be opening, but brick and mortar banks of existing firms have been popping up everywhere. During a time when fewer and fewer people use physical banking, I’ve always presumed that “physical presence” must be a stipulation of receiving government largess or permission to operate. So what has the government done to the cost of doing business as a bank?
lol
The Obama economy. Restricting growth, killing the economy, then saying its the "new normal".
It’s the way it works. Asshat politicians pound the table and say they are going after BIG( fill in the blank) and pass a bunch of regulations insuring only the BIG( fill in the blank)s can survive.
Two words: Dodd Frank.
The Federal Reserve Bank of Chicago shows that there has been an average decline of 27% in new business formations since 2006. If those idiots in DC think this is independent of stupid economic policies they’ve set in motion, from Obozocare to hikes in the minimum wage, they’re crazy. Pile on top of that the job-killing regulations they’ve let agencies, like the EPA, pass without oversight by Congress and you get some idea of just how clueless those idiots are. Add to that the direct screw-ups by Obozo, from Solindra to the closing of oil leases, and we’re lucky anyone still has a job. Lunacy!
Oh yeah Bird-IN-Hand, PA is also near Big Beaver,PA.....
Americans in general HATE banks. Particularly in the current environment. They poll somewhere between fire ants and Ebola in popularity. This is what keeps the Fake Indian a viable candidate for POTUS.
Would YOU want to open one right now?
From a former regulator and current community banker, you hit the nail squarely on the head.
*3*...is that the *new* number? Since we have 3 major healthcare providers now. *Three* it is.
“I wonder if the three new banks are politically connected?”
I do not want to offend you, but this qualifies as the Captain Obvious question of the day.
Of Course they are.
Shut down Obama’s Fascist Regulators!
There were over 18,000 banks.
Now- government regulations , etc. crapped that number down to fewer than 7,000.
It’s “Blue Ball” Pa.
3 opened? how many were closed?
it’d be better to compare Reagan years (1981-1989), Clinton years (1993-2000), GWBush years (2001-2008) and 0bama years (2009-) on the same chart
. . . all of which are a very long distance from Dick, PA. Which, if you think about it, helps explain our loss of electoral votes in every recent census.
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