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I don't expect we'll see that happening. All the circumstances in banking favor consolidation. There are economies of scale that come to mind. And there are also regulatory issues, regulators like to see a banking system that's stable and consolidated. There was a lot of talk about breaking up the big banks following the 2008 crisis, but there was never much follow-up on that.
I could see that happening at some point in the future. To piggyback on the 2008 crisis, there was the Dodd-Frank Act, which did limit some risky activity. It didn’t make big banks split, but I could see the potential for it at some point in time.
Pro
Interesting thought! Banks have kept getting bigger through mergers, but I could see regulation or market pressures eventually pushing them to split, kind of like what’s happening in other industries.
Out of interest, why are Kraft doing that? I can’t see banks choosing to do it but I can see scenarios where it’s insisted on by shareholders (I.e to split out high profit margin areas)
Bowl Leader
Based on what I’m seeing, they are splitting down the line between condiments and foods. So maybe profit margins.