Banks are closing branches again, particularly in the U.S., U.K., New Zealand, and Australia. Branch closings carry more weight in the U.K. and New Zealand, where all-new branches have been the rare exception over the last half century. When a town or central business district loses its last bank, there are worries about other businesses leaving. In the United States, new branch locations open almost every week so that despite many branches closing, the total count of branches has fallen only 6 percent from its 2009 peak.
Portugal has worked out a plan to recapitalize its largest bank, the state-owned CGD, with a bond issue and €2.7 billion in state funds.
In large U.S. cities moving accounts from giant banks to black-owned community banks has become a trend this summer. It’s one part of the Move Your Money campaign, which for years has been trying to persuade consumers that they will get a better deal and their money will be safer at a community-based bank or credit union. The movement got a boost from rapper Killer Mike in February, who mentioned specific black-owned banks and asked fans to “Bank black, bank small, and bank local.” But officials at black-owned banks have said the influx of new customers was only a trickle at first and did not become an obvious change until early in July. Possibly an online list of black-owned banks helped, and mentions on talk radio might have made a difference, but no one seems to know for sure why the Bank Black movement suddenly took off just then. This week the Move Your Money campaign got a boost from presidential candidate Hillary Clinton, who stressed the value of community banks and proposed changes in rules that she says currently make the banking system unstable by favoring the largest banks. Among Clinton’s proposals are new safe-harbor provisions for smaller banks that follow sound lending practices.
