Big Bank Organizations' Share of Deposits Drops: Big Bank Companies' Deposit Share Dips
A Federal Reserve economist has concluded that, while holding companies sharply accelerated their acquisitions of banks between 1968 and 1973, the concentration of deposits ÛÏgenerally did not worsen.Û</br></br>The 100 biggest banking organizations in the country held a smaller percentage of the $630 billion in domestic bank deposits last June than they did of the $390 billion in domestic deposits in June 1968.</br></br>At the state level, concentration increased in slightly more than half of the states, including Virginia, but declined in 22, including the District and Maryland, and remained constant in Delaware.</br></br>Bank holding companies are corporations set up to own one or more banks. While their role in banking has been enormous, there has been little work done on their importance in concentration of deposits.</br></br>The Federal Reserve senior economist who made the study, Samuel H. Talley, cautions against confusing ÛÏaggregateÛÛª concentration, which he finds little changed, with ÛÏmarketÛ concentration. Banking markets, where most competition takes place, are generally considered to be local in geographic scope, while the concentration he examined was wider.