Could America Become Cyprus?

One of the problem with Cyprus is that its banking sector is just too big. GDP is variously reported as rangin from $20 billion to $23 billion, with total deposits being anywhere from 240% of GDP all the way up to 500%. What this means is that Cyprus just isn't big enough to bail out the financial sector.

So what about us? The 2012 GDP was estimated to be about $15.8 trillion. And deposits? A bit under $11 trillion, if this web site is to be trusted. So we're at roughly 70% of GDP.

We have a different problem, with too many deposits being concentrated among the top four banks. Here's a list of the top twenty.

Rank	Total Deposits	Bank Name
1	$1,246,327,000,000	JPMorgan Chase Bank
2	$1,117,622,296,000	Bank of America
3	$994,439,000,000	Wells Fargo Bank
4	$941,185,000,000	Citibank
5	$253,686,214,000	U.S. Bank
6	$239,447,000,000	The Bank of New York Mellon
7	$216,743,265,000	PNC Bank
8	$191,737,996,000	Capital One
9	$169,790,817,000	TD Bank
10	$168,552,949,000	State Street Bank and Trust Company
11	$136,567,968,000	Branch Banking and Trust Company
12	$133,278,697,000	SunTrust Bank
13	$127,864,714,000	HSBC Bank USA
14	$117,448,587,000	FIA Card Services
15	$96,588,183,000	Regions Bank
16	$93,278,271,000	Fifth Third Bank
17	$83,134,216,000	The Northern Trust Company
18	$80,349,888,000	RBS Citizens
19	$79,442,000,000	Charles Schwab Bank
20	$75,097,058,000	Union Bank

Each of JPMorgan and Bank of America have more than 10% of the total deposit base, and Wells Fargo and Citibank aren't far behind. Then there's a $700 billion drop down to U.S. Bank, and a tapering off from there.

To put this into perspective, if the roughly $4 trillion -- roughy 40% of all deposits -- held by the top four banks were transferred to banks no bigger than U.S. Bank, you would need at least sixteen of them, of four per bank.