Report:
Community Banking Decline and Consolidation
Banking consolidation in the United States has reached historic levels. Unless countervailing trends emerge, the United States will continue to lose its small community banks, and the banking market will further be consolidated into a few “too-big-to-fail” financial institutions. In Washington, the impact of consolidation has meant that the state’s banking market is controlled by out-of-state megabanks.
Report:The Constitutionality of a Public Bank in Washington
Since the Great Recession, legislators in Washington have continually proposed the creation of a state-owned public bank. Despite numerous proposals, the state has yet to create such an institution. In this report, Washingtonians for Public Banking describes the constitutionality and relationship that a state-owned public bank would have with Washington’s community banks, credit unions, and community development financial institutions.
Memo:
Public Banks as Public Development Authorities
It is possible for local governments to establish Public Development Authorities (PDAs) as public banks. If established these public banks could make needed investments in local communities and give Washington’s county and municipal governments greater power over their financial futures.
Memo: Washington State Credit Facility
A state credit facility is a program that authorizes the state treasurer to transform a percentage of the state’s average daily balance into low-interest loans. If adopted in Washington, the program could potentially create over a billion dollars in new lending to the state economy.
Memo: Guidelines for a Successful Public Bank for Washington State
Since 2009, bills to create a public bank have been introduced in the state legislature. This memo describes that a Washington state public bank should operate according to four guidelines: 1) independent institution, 2) universal public depository, 3) wholesale banker, and 4) complementary lender. Using these four guidelines, Washington can establish a successful public bank that can significantly increase the availability of credit in the state.
Memo: Public Banking and the FDIC
The Federal Deposit Insurance Corporation (FDIC) was established in the aftermath of the Great Depression to prevent bank runs. While FDIC insurance is considered essential to operating a private commercial bank, it is not necessary, nor even possible given the current regulatory framework, to utilize FDIC insurance for public banks. This does not mean that public banks have no means of insuring their deposits.