Hostname: page-component-cd9895bd7-lnqnp Total loading time: 0 Render date: 2024-12-23T14:26:19.814Z Has data issue: false hasContentIssue false
  • English
  • Français

From exceptional to normal: changes in the structure of US banking since 1920

Published online by Cambridge University Press:  03 November 2020

Richard Sylla
Richard Sylla*
Affiliation:
New York University and NBER
*
R. Sylla, Professor Emeritus of Economics, Department of Economics, Stern School of Business, New York University, 44 West 4th St, New York, NY10012, USA; email: [email protected]
Get access Rights & Permissions [Opens in a new window]

Abstract

A century ago the US commercial banking system was exceptional in two ways. It was by good measure the largest commercial banking system of any country. And it was different from the commercial banking systems of other leading countries in having tens of thousands of independent banks with very few branches rather than the more typical pattern of a far smaller number of banks with many branches. Today, a century later, the US system is more normal than exceptional, dominated by a small number of very large banks with extensive branch systems. This article describes the US banking-structure transition from exceptional to normal. It closes with an interesting contrast of US and European banking developments.

Keywords

banking structurefinancial regulationunit vs. branch bankingbank concentration

JEL classification

N14: Europe: 1913– G21: Banks • Depository Institutions • Micro Finance Institutions • Mortgages G28: Government Policy and Regulation N11: U.S. • Canada: Pre-1913
Type
Articles
Information
Financial History Review , Volume 27 , Special Issue 3: Finance, financiers and financial centres: a special issue in honour of Youssef Cassis , December 2020 , pp. 361 - 375
Check for updates
Copyright
Copyright © The Author(s), 2020. Published by Cambridge University Press on behalf of the European Association for Banking and Financial History

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM (1959). All-Bank Statistics: United States, 1896–1955. Washington, DC: Board of Governors.Google Scholar
Calomiris, C. M. and Haber, S. H. (2014). Fragile by Design: The Political Origins of Banking Crises and Scarce Credit. Princeton, NJ: Princeton University Press.Google Scholar
Calomiris, C. M. and White, E. N. (1994). The origins of Federal Deposit Insurance. In Goldin, C. and Libecap, G. D. (eds.), The Regulated Economy: A Historical Approach to Political Economy. Chicago: University of Chicago Press.Google Scholar
Cassis, Y. (2002). Before the storm: European banks in the 1950s. In Battilossi, S. and Cassis, Y. (eds.), European Banks and the American Challenge: Competition and Cooperation in International Banking under Bretton Woods. Oxford: Oxford University Press.Google Scholar
Fohlin, C. and Jaremski, M. (2020). US banking concentration, 1820–2019. Economic Letters, 190 (May), pp. 1–3.CrossRefGoogle Scholar
Hammond, B. (1957). Banks and Politics in America, from the Revolution to the Civil War. Princeton, NJ: Princeton University Press.Google Scholar
Historical Statistics of the United States, Millennial Edition (2006). Ed. Carter, S. B. et al. , vol. 3. Cambridge: Cambridge University Press.Google Scholar
James, J. A. (1978). Money and Capital Markets in Postbellum America. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar
Kaufman, H. (2016), Tectonic Shifts in Financial Markets. Basingstoke: Palgrave Macmillan.CrossRefGoogle Scholar
Kobrak, C. and Martin, J. (2018). From Wall Street to Bay Street: The Origins and Evolution of American and Canadian Finance. Toronto: University of Toronto Press.Google Scholar
Lewis, W. A. (1949). Economic Survey, 1919–1939. London: G. Allen and Unwin.Google Scholar
Lu, Q. (2017). From Partisan Banking to Open Access: The Emergence of Free Banking in Early Nineteenth Century Massachusetts. Basingstoke: Palgrave Macmillan.CrossRefGoogle Scholar
Michie, R. (2003). Banks and securities markets, 1870–1914. In Forsythe, D. J. and Verdier, D. (eds.), The Origins of National Financial Systems: Alexander Gerschenkron Revisited. London: Routledge.Google Scholar
Mitchell, B. R. (1998). International Historical Statistics, 4th edn. New York: Stockton Press.Google Scholar
Robertson, R. M. (1995). The Comptroller and Bank Supervision: A Historical Appraisal. Washington, DC: Office of Comptroller of the Currency.Google Scholar
Rose, M. H. (2019). Market Rules: Bankers, Presidents, and the Origins of the Great Recession. Philadelphia: University of Pennsylvania Press.CrossRefGoogle Scholar
Sargen, N. (2020). JPMorgan's Fall and Revival: How the Wave of Consolidation Changed America's Premier Bank. New York: Palgrave Macmillan.CrossRefGoogle Scholar
Sylla, R. (2002). United States banks and Europe: strategies and attitudes. In Battilossi, S. and Cassis, Y. (eds.), European Banks and the American Challenge: Competition and Cooperation in International Banking under Bretton Woods. Oxford: Oxford University Press.Google Scholar
Sylla, R. (2006). Schumpeter redux: a review of Raghuram G. Rajan and Luigi Zingales's Saving Capitalism from the Capitalists. Journal of Economic Literature, 45 (June), 393–406.Google Scholar
Sylla, R. (2011). Wall Street transitions, 1880–1920: from national to world financial centre. In Quennouëlle-Corre, L. and Cassis, Y. (eds.), Financial Centres and International Capital Flows in the Nineteenth and Twentieth Centuries. Oxford: Oxford University Press.Google Scholar
Tooze, A. (2018). Crashed: How a Decade of Financial Crises Changed the World. New York: Viking.Google Scholar
White, E. N. (1983). The Regulation and Reform of the American Banking System, 1900–1929. Princeton, NJ: Princeton University Press.CrossRefGoogle Scholar