FAILURES OF LARGE BANKS: IMPLICATIONS FOR BANKING SUPERVISION AND DEPOSIT INSURANCE.

The article focuses on the trend of large banks failing, primarily in greater numbers since 1965, 30 years after the establishment of the Federal Deposit Insurance Corporation (FDIC). The widespread failure of large banks is a result of trends in the U.S. banking system since the early 1960s. Many banks began to strive for a rapid increase in assets, deposits, and income. The situation grew stronger during the tenure of James Saxson as Comptroller of the Currency. This paper attempts to examine the problem of large bank failure and to determine whether this problem needs to modify bank supervision and deposit insurance methods. Examined are the policies and procedures regarding small bank failure. The last section discusses possible solutions to this crisis.