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New York's 10 Most Important Banks

Rich Smith
May 21, 2013

How big is "too big to fail"? In the great state of New York, it's pretty darn big.

In fact, in some places "2B2F" is pretty darn near to "too big to compete with."

Meet your banker -- whether you like it or not
A recent report out of the Federal Deposit Insurance Corporation tallied up the size of bank deposits among New York's 10 top banks, giving a good picture of who owns what kind of "customer real estate" in the New York banking market. The results may surprise you.

Data from the New York Fed, current as of June 2012.

See that big green line of billion-dollar bills down there at the bottom? That's JPMorgan Chase's (NYSE: JPM) deposit base -- and it's bigger than the next seven banks above it, combined -- including fellow 2B2Fers Citigroup (NYSE: C) and Bank of America (NYSE: BAC).

According to the FDIC's figures, JPMorgan boasts a 36.9% market share in the state of New York. That's more than four times the share of the state's No. 2 bank, Bank of New York Mellon (NYSE: BK).

An important thing to remember
What explains these banks' popularity? In a sense, they're probably at least partially "popular for being popular." They're New York's 10 most important banks precisely because of their size. Because with great size comes great ease of access for their customers -- more branches, more ATMs, more ability to hit a JPMorgan signpost with every swing of a dead cat.

On the other hand, I'm not so sure that the banks' great size will always be a good thing for their investors.

Think about it. Having great size, and benefiting from the "network effect" among its customers, banks like JPMorgan look like good, safe, defensive investments. Absent a major self-inflicted wound, it should be very hard to unseat them from their dominant positions.

On the other hand, once you've attained 37% marke