Douglas Amendment

Picture what life would be like if the entire country was controlled by just a few massive banks. Yep...a fee every time you flush. And more.

Thanks to the foresight of Illinois Senator Paul Douglas, this has not happened (at least not yet). In 1985, Senator Douglas introduced an amendment to the 1956 Bank Holding Act that restricted banking firms from acquiring banks in other states unless the acquisition was approved by that state. At the time, small regional banks were being scooped up by the big guys, and they had their eye on expanding this practice to other states. However, the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 repealed the Douglas Amendment and allowed nation-wide banking. That’s why today there are far fewer banks operating in the U.S., which caused a few problems during the Great Recession of 2008.