Using this measure, we can estimate the importance of small business lending to community banks and the importance of community banks to small businesses. As of September 2012, banks with $ billion or less in assets accounted for more than 98 percent of all commercial banking institutions, but they held less than 20 percent of banking industry assets.
There is also the risk of ending up with a patchwork of exceptions that are difficult to interpret. The second path would be more radical. The creation of a separate regulatory framework for small institutions – also known as the “small banking box” – would mean more fundamental relief for these institutions. A clear and consistent definition would also prevent any difficulties in interpretation.