Smaller banks stabler than large ones, BoE official says

09/15/2009 | Bloomberg

Andrew Haldane, an official at the Bank of England, called for an overhaul of banks' business models to make the broader financial system increasingly resilient and stable. He said the crisis highlighted that smaller banks are typically more stable than large banks. "There is not a scrap of evidence of economies of scale or scope in banking -- of bigger or broader being better -- beyond a low size threshold," Haldane said. "Big banks have if anything been found to be less stable than their smaller counterparts, requiring on average larger-scale support."

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