The Great Debate UK
By Rob Cox
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
To hear the Federal Deposit Insurance Corp tell it on Tuesday, the American banking industry is returning to fine fettle. The number of institutions on the agency's problem list fell for the first time in nearly five years. Bank failures are down. Loan books even grew slightly. So, the crisis in America's financial system is officially coming to an end.
Yet although in aggregate the industry looks in better shape than it has been for several years, the reality is more complicated. America's biggest banks are indeed recovering nicely. But they are doing so at the expense of the country's thousands of smaller institutions.
Consider the FDIC's latest statistical data dump. The country's 106 banks with assets of more than $10 billion increased their share of industry assets to a record 79.1 percent. That has made them more efficient and allowed them to grow their earnings some 20 percent faster than smaller banks in the second quarter.
from The Great Debate:
Britain's new coalition government likes to remind voters we are all in this together. The phrase is rather glib. But in an important sense savers and borrowers around the world are finding the costs of reckless lending are falling on the innocent and guilty alike.
Few people this century will have experienced what it is like to turn up at their bank and be told they cannot withdraw deposited funds because the bank has "suspended" payments.
It's time for someone in the Obama administration to read the riot act to Robert Benmosche, American International Group's new $7 million chief executive.
Since getting the job, Benmosche has spent more time at his lavish Croatian villa on the Adriatic coast than at the troubled insurer's corporate offices in New York.