The first signs are there that bank lending is rising again, a shift that could bode well for the economy in general. We think it could also be beneficial for community banks in the United States. More than five years after the financial crisis appeared and banks began booking massive losses, they are approving more loans to businesses that are seeking to grow.
Some evidence is already occurring, including:
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Are small banks a thing of the past?
I believe they are... and there is a growing realization that this, in fact, is a reality.
According to the Wall Street Journal, "Small Banks Look to Sell," the banking environment has changed.
So have the statistics. On December 31, 2013, according to the FDIC, there were 1,814 banks that had assets fewer than $100 million; there were 3,522, banks with assets between $100 million and $1.0 billion.
One year earlier, on December 31, 2012, there were 1,954 banks with less than $100 million in assets and 3,607 banks that had assets between $100 million and $1.0 billion.
Before the recession, on December 31, 2007, these numbers were 3,066 and 3,705.
Thus, there are 2,252 fewer of the smallest banks since the end of 2007, 140 less than one year ago and 98 fewer of the larger category since