Here are some words to the tune of John Philip Sousa’s “Liberty Bell March,” written by a long-time friend and banking colleague, which reflect the banking history of the last few decades. They begin:
You were a big bank,
Blink and now you’re gone!
And here is the list of the 10 biggest banks by total assets in the United States in 1981, in order:
- Bank of America, San Francisco
- Citibank, New York
- Chase Manhattan, New York
- Manufacturers Hanover, New York
- Morgan Guaranty, New York
- Chemical Bank, New York
- Bankers Trust, New York
- Continental Illinois, Chicago
- First National Bank of Chicago
- Security Pacific, Los Angeles
Of the 10, only two still exist as independent companies.
These are Citibank, which has in the meantime been bailed out by the government, and Chemical Bank. Although the name “Chemical Bank” no longer exists, that is the bank which acquired Manufacturers Hanover, Chase Manhattan, and Morgan Guaranty—the whole thing then had its name changed to JPMorgan Chase, neither of which were surviving companies.
The Bank of America on the list was in its day the big California bank, which got bought by NationsBank of North Carolina, which changed its name to Bank of America.
Bankers Trust, Continental Illinois, First National of Chicago, and Security Pacific are long gone, all absorbed into other banks.
In 1981, these 10 banks represented 10 prestigious CEOs and 10 prestigious boards of directors. Now there are two of each.
As the great economist Joseph Schumpeter rightly said, “Capitalism not only never is, but never can be, stationary.”
Alex J. Pollock is a resident fellow at the American Enterprise Institute.
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