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Fed’s Fisher: Five Largest Banks 'Should Be Broken Up'
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| Contributor | Craverguy |
| Last Edited | Craverguy Apr 03, 2012 03:26pm |
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| Category | Statement |
| News Date | Wednesday, February 29, 2012 06:30:00 PM UTC0:0 |
| Description | The five biggest banks in the United States are too powerful and should be broken up, Dallas Fed President Richard Fisher said on Wednesday.
The financial crisis has left the five biggest banks even more powerful than before, he said at an event in Mexico City.
The five biggest U.S. banks are: JPMorgan, Goldman Sachs, Morgan Stanley, Bank of America, and Citigroup.
"After the crisis, the five largest banks had a higher concentration of deposits than they did before the crisis," he said. "I am of the belief personally that the power of the five largest banks is too concentrated."
The U.S. Dodd-Frank reform and consumer protection act includes mechanisms for regulators to break up large financial companies, but imposes high hurdles for such action.
"The purpose of Dodd-Frank was to reduce the concentration of power and we have a term called 'too big to fail'... perversely, these banks are now even bigger, they are too 'bigger' to fail than before."
Last month a group of consumer advocates, academics and economists said they wanted to end "too-big-to-fail" banks, starting with Bank of America.
Fisher continued his U.S. assessment by focusing on consumer demand, which he said is driving a pick-up in the economy although risks remain. |
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