Community banking has been called into question again. I
agree there are far too many small banks. Of the 6700 banks over 2000 have less
than $100MM in assets. Additionally, hundreds of small banks failed or were
merged during the financial crisis. Nonetheless, community banking, if not
community banks, has a bright future. Changing technology promises to upend the
branch orientated delivery-there are over 85,000 domestic branches. The
technology will supplant the branch system in ways not yet fully understood.
This disruption will cause a massive change in strategies.
Institutions, both bank and non bank will struggle to adjust. Those adapting
will probably divest branch networks and acquire new technology and
consolidate thru mergers to succeed. See Community Banks recently published in the American Banker for a discussion.
Happy New Year.
J
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