Mark Winston Griffith

Bank Merger Mania

New Yorkers, at least those who actually have bank accounts, are getting remarkably used to walking into their local branch and discovering it has devolved into a 99 cent store, or that it is flashing different banking colors because it has been absorbed into some banking behemoth.

In the last few months alone, Sovereign announced it was merging with Independence Community Bank; Capital One announced its merger with North Fork Bank; Carver acquired Community Capital Bank; and New York Community Bancorp - the holding company for New York Community Bank, New York Commercial Bank, Queens County Savings Bank, Roslyn Savings Bank, Richmond County Savings Bank and Roosevelt Savings Bank, among other banks - merged with Atlantic Bank.

But perhaps the one that is raising the most eyebrows at the moment is JPMorgan Chase Bank's acquisition of 338 of Bank of New York's branches, as well as $14.5 billion in deposits and $7.8 in loan balances. After all is said and done, JPMorgan Chase will account for 28% of all deposits held in New York State.

In addition to representing a disturbing monopolization of consumer banking in New York, an assortment of questions have been raised in the past by advocates regarding issues like JP Morgan Chase's poor small business lending record and its capitalization of fringe banking services like sub-prime lending and tax refund anticipation loans. Many fear that branches in low-income areas will be lost, as well as jobs.

JPMorgan Chase submitted an application to the federal Office of the Comptroller of the Currency (OCC) for regulatory approval on May 5th. And while hearings that would give the public an opportunity to weigh in on this acquisition would be in order, the OCC almost never holds public hearings.

The stage is set for advocates to make some noise. Pump up the volume!

Mark Winston Griffith: Author Bio | Other Posts
Posted at 9:53 AM, May 22, 2006 in Banking
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