The primary reason for the recent reduction in the number of banks is
A) bank failures.
B) re-regulation of banking.
C) restrictions on interstate branching.
D) mergers and acquisitions.

Question

Quizplus · Accepted Answer

The recent reduction in the number of banks is primarily due to mergers and acquisitions. Large banks are acquiring smaller banks, leading to consolidation and a decrease in the total number of banks. Additionally, some smaller banks are choosing to merge with others in order to achieve economies of scale and compete more effectively in the market. Bank failures and re-regulation of banking have not been significant drivers of this trend. Restrictions on interstate branching have been loosened in recent years, which could actually spur more bank consolidation and further reduce the number of banks.

The Primary Reason for the Recent Reduction in the Number