Unit Banking

Unit Banking

A system of banking in which the government restricts or does not permit a bank to open branch offices. Unit banking systems encourage either small, independent banks or banks that are theoretically independent but are in fact owned by a bank holding company. In the United States, unit banking is largely confined to the Midwest and Southwest.
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The unit banking system was inherently unstable because banks could diversify neither loan portfolios nor deposits.
Party's state unit banking on Satish Upadhyay to lead it in fresh polls
This report reinforces our commitment to develop service-oriented architecture-based solutions that enable our customers to address their changing business needs," said Falk Rieker, global vice president and global head, industry business unit banking, SAP.
This report reinforces our commitment to develop service-oriented architecture-based solutions that enable our customers to address their changing business needs, said Falk Rieker, global vice president and global head, industry business unit banking, SAP.
As we continue to expand SAP's global footprint, we have found our banking customers dealing with an unprecedented amount of risk and regulatory requirements," said Falk Rieker, global head, Industry Business Unit Banking, SAP.
Proponents of unit banking also argue that branching will hurt the small local borrower as the bigger, and more distant, bankers will perhaps be less willing to extend credit (Jay (1933)).
Unit banking laws contributed to bank failures by preventing them from opening branch offices to diversify deposit bases and loan portfolios.
has been almost unique in preserving a unit banking system," and that it had achieved this distinction by means of legal "barriers against interstate banking" (Friedman and Schwartz 1986: 54).
For example, Flannery (1984) presents evidence that banks in unit banking states (i.
The perverse incentives of state-level deposit insurance systems enacted before World War I produced banking collapses in several states in the 1920s, which added further to the costs from unit banking.
However, banking laws at the time limited expansion through unit banking laws and the like, restricting the production function and thereby asset creation.
9) The Brickley and James (1987) study is based on 1980 data for banks in unit banking states.