The MegaBanks: Slowing Loan Originations on Purpose?

You might say the megabanks – for now – are sitting in the catbird seat. They have more loan applications than they know what to do with – and they have no desire whatsoever to add more staff to handle the volume, because, well, that’s what happens when you have a cartel. (I’m sure there’s some unemployed LOs or underwriters out there who could use a job.) Perhaps, that’s a negative view of the megabanks, but there are plenty of hungry nonbanks out there eager to increase volume and their market share – and they’re hiring.  Over the next three years the industry will hopefully see a shift in the cartel – but will it see the actual breakup of the Wells Fargo-JPMorgan Chase-Bank of America near-monopoly? Time will tell – but much of this will depend on how much power the Consumer Financial Protection Bureau winds up giving to the megabanks as it destroys the ability of brokers and nonbanks to make a living.