The AP's Russ Bynum writes an excellent piece that helps explain why Georgia has found itself at the tippity top of a terrible list the state with the highest number of bank failures:
Experts say its a combination of an antiquated state law that favored a plethora of smaller community banks over multi-branch giants; a population explosion in metro Atlanta that fueled massive suburban real estate development and a crush of new banks formed to cash in on the Atlanta boom shortly before the market tanked.
Georgias diversity of small banks was an asset when the economy was strong, with consumers benefiting from competitive rates and broader sources of credit, said James Verbrugge, a professor emeritus of finance at the University of Georgias Terry College of Business. It became a liability when the bottom fell out of the housing market and smaller banks had less capital to weather the crisis.
The excerpts don't do the article justice. Give it a read for your daily dose of edumacation.
(Hat tip to Travis Fain)
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