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Not that long ago, there were no U.S. financial institutions deemed too big to fail. Commercial banks were not allowed to grow beyond well-defined geographic limits and investment banks were constricted by their limited access to capital—and neither was allowed into the other’s business.
By state and national law, commercial banks were not permitted to branch very far, if at all, from their headquarters, and as a result banking was a localized business. Each city was home to a number of single-office banks, the oldest and largest usually holding the title of First National in front of the name of the city it served. A fair number of banks had grown their assets beyond the billion-dollar mark toward the end of the twentieth century, especially in the cities with one of the twelve Federal Reserve Banks. Until recently, however, few would have imagined that America would be home to trillion-dollar banks.
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