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Article: Focusing on Share? Wise Up, Analysts Say.(market share)(Industry Overview)
- Article from:
- American Banker
- Article date:
- November 1, 2004
- Author:
CopyrightCOPYRIGHT 2004 SourceMedia, Inc. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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It may be time to reconsider long-held notions about the importance of market share.
Many banking experts say that being one of the biggest banks in town is of little value, even though they acknowledge the fundamental advantages of scale. Surging to the top in deposits -- a rationale that has justified many mergers in the industry -- may be important to some bank executives but yields few benefits for shareholders.
"Being No. 1 is irrelevant," said Chris Marinac, an analyst with FIG Partners LLC in Atlanta. "It may be nice to know, but it doesn't really suggest anything."
Emphasis on being on top is "a big-bank mentality that's highly flawed," he said. "A bank ...