Regulation, Protection, and the Structure of the International Banking Industry

One of the remarkable features in the comparison of the banking industry in various countries is the sharp difference in the number of firms and in the scope of concentration. Three national patterns are evident. One, perhaps the most typical, is that four or five banks account for 80 per cent of total bank assets and deposits; the banking industries in Canada, the United Kingdom and Switzerland conform to this pattern. The second pattern is illustrated by Italy and Japan, where banking is less concentrated; the ten largest banks account for less than 50 per cent of total bank deposits and liabilities. Banking is least concentrated in the United States, where there are more than 10 000 banks, more than in all other countries combined.1