The chief executive of a bank in North Dakota predicted a "dangerous and unprecedented concentration of economic power." The president of a bank in Colorado foresaw "unacceptable risk to the banking system." The head of a California bank anticipated "long-term community disinvestment."
For consumers, more competition would help us get better deals. However, this Wal-Mart bank isn't designed to compete with consumer banks. The application is for an industrial bank that would process credit and debit card transactions for its US stores, saving the retailer what it now pays to national banks every time a shopper pays with plastic.
This doesn't give community bankers much comfort. Coalitions have been formed and members of Congress have asked FDIC for hearings on the application.
Before we can walk into the Bank of Wal-Mart, it'll have to get the FDIC approval (a decision is due in July 2006) and it'll then have to change its intention to consumer banking. It's probably not something we'll see in the next few years.