The recession was especially unkind to small community banks. About 85 percent of banks that failed 2008-2011 were considered small, with assets below $1 billion. The majority were concentrated in ten states led by Georgia and Florida.
Smaller banks tend to have a larger portfolio of small business loans, therefore increased risk. But smaller banks also tend to get involved in local community development and philanthropy.
Check out our video for more on small banks and their special vulnerabilities. See “What Do Others Say?” for more views, then add to the discussion below. Are bigger banks better? Is there a role for smaller banks in today’s economy?