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Long-Term Trends in Banking Conditions

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During the severe economic downturn of the early 1930s, more than one-third of U.S. banks ceased operations. After federal deposit insurance began in 1934, the number of insured commercial banks remained fairly stable for about 50 years and then began to fall dramatically in the mid-1980s. This decline is commonly attributed to relaxation of bank branching restrictions. In the past two years, however, the trend toward consolidation has slowed.


Suggested citation: "Long-Term Trends in Banking Conditions," Federal Reserve Bank of Cleveland, Economic Trends, no. 00-06, pp. 17, 06.01.2000.

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