The Era of Big Bank mergers has passed

Will we ever see another big bank merger?

Excerpts:

Yet banks and other financial companies – usually among the most avid shoppers for deals – have been conspicuously subdued amid the corporate coupling. In prior merger-and-acquisition cycles, bank mergers have produced increasingly gargantuan institutions and progressively more byzantine financial conglomerates. ... A firm regulatory commitment to keep the largest banks from getting any bigger or more complex is keeping this activity in check. The authorities intend for banking to stay boring – and this is how the sector will remain for consumers and investors.

Comment: Image Source. List of bank mergers in the United States.

Kathee and I were talking yesterday at dinner how our entire careers at Wells Fargo have been characterized by M&A activity. Kathee started at the old United Bank of Colorado (acquired by Norwest). Of course the Wells Fargo - Norwest merger and Wells Fargo - Wachovia merger were the largest. We've also been through Y2K (that involved quite a bit of preparation). I see the banking industry in the US as follows:

• You have the nationals (C, BAK, JPM, and WFC). I really think WFC is the strongest. We have stock in WFC and JPM. I've passed on buying stock in the other two.
• You have the regionals: Sun Trust, Regions Bank, US Bank, BBVA and others. 
• You have the credit unions - eg Spire in Minnesota
• You have mini-regionals - eg TCF
• You have large state centric banks: Frost Bank in Texas and First Bank in Colorado are examples.
• And then the pure locals (small but personal). Privately owned by millionaires they may have one or two offices. An example is Bank West in Rockford MN with 3 locations

Some decry the large banks and see that there is little competition. But the industry has a lot of competition. What I like about a national bank:

• Stores or branches available across the country (although none have the entire US footprint). I think about going into a Wells Fargo store in Marquette MN or in North Carolina. 
• A credit card. TCF for example does not offer one
• A brokerage service. For example I can instantly transfer money from my checking or savings account to my brokerage account
• A mortgage service (don't have one now but potentially could  in the future)
• A robust platform. Think about the old Hiberia bank that was completely taken out by Hurricane Katrina when both their production and their BCP site flooded.
• A 24-hour phone bank. I called another bank on behalf a relative. It was a holiday and I received the message "call back during business hours"