13 Bankers educates us on the 10% cap on the nations deposits that any single bank can have:
The facts are a little more complicated. The Riegle-Neal Act of 1994 did create a 10 percent deposit cap (codified in 12 U.S.C. 1842(d)), but the cap is enforced for acquisitions, not for organic growth. In September 2007, the Federal Reserve approved BofA’s purchase of LaSalle Bank on the grounds that BofA had 9.0% of deposits and LaSalle had 0.9% of deposits, so the combined bank would only have 9.9% of deposits. Then BofA got across the 10% line organically. In June 2008, when the Fed approved BofA’s acquisition of Countrywide, BofA already had 10.04% of deposits; however, since Countrywide’s only insured depository subsidiary, Countrywide Bank, was a “federal savings bank,” it was not a “bank” for the purposes of the 10 percent deposit cap (see Federal Reserve order, p. 5, n. 13).
This same loophole allowed Bank of America to buy Merrill Lynch in September 2008. BofA already had 10.8 percent of all deposits at insured depository institutions, and Merrill had 1.1 percent of deposits.
There's more:
In October 2008, the Federal Reserve Board also approved Wells Fargo’s acquisition of Wachovia. Based on the latest available data at the time (June 30, 2008), the combined company would have 10.1 percent of total deposits. This time, however, the Fed ruled that based on other data, total deposits were likely to have grown around 3 percent in Q3 2008, meaning that Wells-Wachovia would have less than 10 percent of total deposits.
The logic of cartelized banking.
