NYT: A Fed Voice, Asking to Cut Meg http://mobile.nytimes.com/2013/01/20/business/a-fed-voice-asking-to-cut-megabanks-down-to-size.xml
There are roughly 5,600 commercial banking institutions in the country, Mr. Fisher noted. Some 5,500 of them are community banks. While these organizations account for 98.6 percent of all banks, they hold only 12 percent of total industry assets. They are routinely allowed to fail if they get into trouble. Few of them did during the crisis. Contrast these figures with those of the nation’s 12 largest banks, whose assets range from $250 billion to $2.3 trillion. They account for 0.2 percent of all banks but hold 69 percent of industry assets. These are the banks that enjoy all the perquisites of the federal safety net: significantly lower borrowing costs and a taxpayer backstop, for example.
It’s the same massive distorting inequality we see in society at large. In the larger society, it distorts the political process. In the banking world, it distorts the global economy.