In this regard, so long as we do not place artificial regulatory roadblocks in their way, I am not overly concerned with the ability of our smaller banks to compete with their large, regional or national counterparts. Our research shows that, when a large bank enters a new market through acquisition of an existing smaller institution, typically lending to small businesses initially declines.
But then existing community banks take up the slack by lending to the borrowers spurned by the larger organization. Indeed, several community bankers have commented that they welcome the entry of large institutions into their markets via the acquisition route, seeing it as an opportunity to acquire some of the customer base that often is lost by the newly acquired bank.