Banking On Our Future

The recent financial crisis has led many commentators to call for the breakup of large US banks. However, these analysts often overlook some critical points:

• Large banks are valuable to the US and global economies – Big multinational banks are vital to US companies and investors operating in global markets. These institutions provide “trade finance, securities underwriting, currency hedging and interest rate risk management, transaction and payment services,” plus numerous other services that smaller banks cannot offer. Critics say that large banks are inefficient when they reach a certain size and that breaking them up would not harm the...