Bank Asset Concentration Not Necessarily Cause for Worry

4 Pages Posted: 21 Jun 2017

See all articles by Ricardo T. Fernholz

Ricardo T. Fernholz

Claremont McKenna College - Robert Day School of Economics and Finance

Christoffer Koch

Federal Reserve Bank of Dallas

Date Written: 2017

Abstract

U.S. banking assets have become substantially more concentrated within a few large institutions. However, decreasing relative rates of big-bank growth and of idiosyncratic volatility—an indicator of individual bank susceptibility to shocks and a resulting redistribution of assets—suggest a reduction in systemic financial system risk through contagion.

Suggested Citation

Fernholz, Ricardo T. and Koch, Christoffer, Bank Asset Concentration Not Necessarily Cause for Worry (2017). Economic Letter, Vol. 12, Issue 7, pp. 1-4, 2017. Available at SSRN: https://ssrn.com/abstract=2990307

Ricardo T. Fernholz (Contact Author)

Claremont McKenna College - Robert Day School of Economics and Finance ( email )

500 E. Ninth St.
Claremont, CA 91711-6420
United States

Christoffer Koch

Federal Reserve Bank of Dallas ( email )

2200 North Pearl Street
PO Box 655906
Dallas, TX Texas 75265-5906
United States

HOME PAGE: http://www.dallasfed.org

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