Urban vs Rural - 5
Mar. 1st, 2019 09:48 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
timelets(WSJ, 3/2/2019) Big banks have boosted profits in recent years by focusing on the largest U.S. cities, which are densely populated and more affluent. The community banks trying to fill the gaps they leave behind, meanwhile, are struggling.
The 4,600 U.S. banks with $1 billion or less in assets—small community banks—today hold 6.6% of all bank assets combined. Three decades ago, around the time new laws spurred industry consolidation, they held 31.5%.
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Technology is causing strains throughout the banking industry, especially among smaller rural banks that are struggling to fund the ballooning tab. Consumers expect digital services including depositing checks and sending money to friends, which means they don’t necessarily need a local branch nearby. This increasingly means people are choosing a big bank over a small one.
People who think that blockchain (bitcoin, etc..) is going to be this great equalizer are fooling themselves. The learning curve is too expensive to climb for the small players. On the other hand, enabling large banks to compete in the emerging space is going to be a lucrative market. What would be the leverage outside of big banks?
