The number of banks in America has been falling for decades
The United States has roughly 4,000 to 4,500 banks operating today, depending on how you count them and which month you check. That number has dropped steadily since the 1980s, when there were nearly 15,000. The decline happened because of bank mergers, failures during recessions, and stricter rules that made it harder for small banks to stay open.
The actual count changes month to month as banks merge, close, or get acquired. The Federal Deposit Insurance Corporation (FDIC) — the government agency that insures deposits — tracks this number and publishes it regularly. If you need the most current figure, their website has the exact count updated quarterly.
What matters more than the total number is what kind of bank you're looking at. A few giant banks control most of the money in the system, but thousands of smaller regional and community banks still operate in nearly every town. The bank you use depends on where you live and what you need, not on how many banks exist overall.
Key Takeaways
- The United States has approximately 4,000 to 4,500 banks, a significant drop from 15,000 in the 1980s due to mergers and stricter regulations.
- The FDIC publishes the exact current count of banks quarterly, so the number you find will vary slightly depending on when you look.
- A small number of very large banks hold the majority of deposits, while thousands of smaller community and regional banks serve local areas.
- Bank consolidation accelerated after the 2008 financial crisis and has continued as operating costs and regulatory requirements have increased.
Why the number of banks keeps shrinking
The biggest reason banks disappear is mergers. When two banks combine into one, the total count goes down even though the combined bank may be larger and serve more customers. Mergers happen because bigger banks can spread their costs across more customers, making them more profitable. A small bank with one branch in a rural town might merge with a regional bank that has 50 branches, and suddenly that's one fewer bank in the count.
Bank failures also reduce the number, though this happens less often now than it did during the 2008 financial crisis. When a bank fails, the FDIC takes it over, protects depositors' money up to $250,000 per account, and usually sells the failed bank's assets to another bank. The failed bank disappears from the count.
Stricter regulations after 2008 made it much harder to start a new bank. New banks need more capital (money set aside to cover losses), must pass more inspections, and face higher compliance costs. This raised the barrier to entry so high that very few new banks have opened in the last 15 years. The ones that do open are usually specialized banks serving a particular industry or customer type.
The difference between big national banks and community banks
When you hear about "the banks," people usually mean the largest ones: JPMorgan Chase, Bank of America, Wells Fargo, Citibank, and a handful of others. These five banks hold roughly half of all deposits in America. They have thousands of branches nationwide, offer every product imaginable, and are "too big to fail" — meaning the government will step in if they're in trouble because their collapse would damage the entire economy.
Community banks and regional banks are smaller and usually serve a specific area or state. They might have 10 to 500 branches instead of thousands. Many people prefer them because loan decisions are made locally, staff know their customers, and they're more likely to lend to small businesses or people with unusual financial situations. Community banks still make up the majority of the 4,000-plus banks in America, even though they hold far less total money than the giants.
Credit unions are sometimes confused with banks, but they're different. A credit union is a nonprofit owned by its members, while a bank is a for-profit business. Credit unions often have lower fees and better rates on savings, but they're not counted in the "number of banks" — they're tracked separately. There are roughly 4,800 credit unions in America.
How the bank count is measured and reported
The FDIC publishes the official count of banks in America. They count any institution that has FDIC insurance, which includes most traditional banks but excludes credit unions, investment firms, and online-only operations that aren't FDIC-insured. The count includes both national banks (chartered by the federal government) and state banks (chartered by individual states).
The number changes quarterly as banks merge, close, or open. If you see different numbers in different sources, it's usually because they're from different quarters or they're counting slightly different things. The FDIC's Quarterly Banking Profile is the most reliable source if you need the exact current figure.
Some sources count "banking organizations" instead of individual banks. A banking organization might own multiple banks under different names. For example, one large company might own a national bank, a state bank, and several subsidiary banks, but that counts as one organization. This distinction matters if you're researching the industry, but for most people, the straightforward count of individual banks is what matters.
What happened to all the banks that closed
Between 1980 and 2020, roughly 10,000 banks disappeared from America. Some failed during recessions — the savings and loan crisis of the late 1980s, the 2008 financial crisis, and smaller downturns all wiped out banks that couldn't survive. Others merged voluntarily because owners wanted to sell or because staying independent became too expensive.
The 2008 crisis was the biggest shock. Hundreds of banks failed as the housing market collapsed and people stopped paying mortgages. The FDIC took over failing banks, protected depositors, and sold the assets to surviving banks. This accelerated consolidation — the number of banks dropped from about 8,500 in 2008 to around 5,000 by 2015.
In recent years, the pace of decline has slowed. Mergers still happen regularly, but failures are rare because regulations are stricter and banks hold more capital. The number has stabilized around 4,000 to 4,500, though it continues to drift downward as consolidation continues.
Where to find the current bank count
The FDIC's website publishes the Quarterly Banking Profile, which includes the exact number of banks as of the most recent quarter. You can find this on fdic.gov under their research and statistics section. The report also breaks down banks by size, location, and type, so you can see how many community banks operate in your state or how many banks have assets over a certain amount.
If you're researching a specific bank or want to know whether a bank is FDIC-insured, the FDIC's BankFind tool lets you search by name or location. This is useful if you're opening an account and want to confirm the bank is legitimate and your deposits will be protected.
Frequently Asked Questions
Is my money safe if my bank is one of the smaller ones?
Yes, as long as the bank is FDIC-insured. The FDIC protects deposits up to $250,000 per account holder per bank, regardless of the bank's size. You can check whether a bank is FDIC-insured using the BankFind tool on the FDIC website. Size doesn't determine safety — regulation and insurance do.
Why do big banks keep getting bigger if there are fewer banks now?
When two banks merge, the larger one usually absorbs the smaller one, so the surviving bank gets bigger. The largest banks have grown because they've acquired hundreds of smaller banks over the past 40 years. Regulators allow most mergers because they don't violate antitrust law, though they do scrutinize deals involving the very largest banks.
Could the number of banks go back up?
It's unlikely in the near term. Starting a new bank requires millions of dollars in capital, regulatory approval that takes years, and ongoing compliance costs. The last major wave of new bank openings was in the 1980s and 1990s. Today, most new financial services come from fintech companies and online banks rather than traditional brick-and-mortar banks.
What's the difference between a bank and a credit union?
A bank is a for-profit business owned by shareholders, while a credit union is a nonprofit owned by its members. Credit unions often have lower fees and better rates, but they're smaller and may have fewer branches. Both are insured — banks by the FDIC and credit unions by the NCUA (National Credit Union Administration).