American banking lies in an uncomfortable mix of three big banks, and 8,000 smaller ones (with apologies to Wells).
As the dust settles on the last two weeks the realisation of what has occurred with the disappearance of Wachovia, WaMu, and the investment Banks, will settle, and the result will not offer opportunities, and implications not forseen.
The US banking food chain is a dangerous place to be. The minnows, though, have got off lightly, while bigger fish have made a meal of each other. Where does that leave prospects for consolidation among the 8,000-odd US banks, struggling with exposure to home loans and commercial property?
The largest banks, Bank of America, Citigroup and JPMorgan Chase, now hold almost a third of the nation’s deposits between them thanks to the quirks of definition of what makes up the regulatory cap of 10 per cent of domestic deposits for each.
Bankwatch 