Magazine article American Banker

Miller, Ellison Propose Size Caps for Banks

Magazine article American Banker

Miller, Ellison Propose Size Caps for Banks

Article excerpt

Byline: Kevin Wack

WASHINGTON a Two House Democrats on Thursday followed the lead of Sen. Sherrod Brown in proposing legislation that would impose strict caps on the size of U.S. banks.

Reps. Brad Miller and Keith Ellison introduced an identical House version of the Safe Banking Act that Brown offered in the Senate on Wednesday.

"The gigantic size of megabanks, and the perception in the marketplace that they are too big for the government ever to permit to fail, gives them an unfair competitive advantage over smaller financial institutions that distorts the market and discourages competition." Miller said in a press release. "The lack of competition in the banking industry, in turn, leads to ever-higher levels of risk in the system."

The legislation aims to close loopholes in existing rules by imposing a strict 10% cap on an institution's allowable share of the nation's deposits and liabilities. …

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