Is a financial system dominated by giant banking institutions good for business?

Dr. Paul Merski says that’s a question that deserves an answer, and he plans to offer his insights next week in Memphis.

The Rhodes Chapter of the Financial Management Association and the Department of Economics and Business will host Merski’s lecture, “Financial and Economic Outlook: A View from Washington,” on Wednesday.

Merski is the senior vice president and chief economist for the Independent Community Bankers of America, an organization representing 5,000 community banks of all sizes throughout the United States.

“I’ll be looking at where we’ve come from in the past few years with the large financial crisis and the meltdown in the financial sector largely caused by the too-big-to-fail Wall Street banks,” Merski said recently by phone from his office in Washington.

Chris Nunn is chief financial officer of Security Bancorp of Tennessee Inc. and an adjunct professor of auditing in the business and economics department at Rhodes. A longtime friend of Merski, he had a hand in bringing the financial expert to Memphis.

“I think it’s relevant in the present situation, given the complexity of the legislation recently passed and currently working its way through Congress, specifically the health care and regulatory reforms bills, to gain insight from an insider as to how these items will impact the future of our country,” Nunn said.

Of the total banks nationwide, the vast majority — 8,000 out of 8,300 — are community banks, yet the top four or five banks, Merski said, still control about half of all the assets in the nation.

“You have a very unbalanced scale of a handful of mega-, trillion-dollar banks on one hand and then thousands of smaller and midsize community banks nationwide,” he said. “The deposit contribution is in just a handful of banks and that has serious policy implications, as we’ve seen.”

Merski graduated with an economics degree from the Catholic University of America, earned his MBA with top honors from George Mason University and has 20 years of Washington government relations experience.

He has previously been a top policy advisor to U.S. Sen. Connie Mack, R-Fla., and served as the chief economist of the Joint Economic Committee of Congress.

“As we pull out of this financial crisis,” Merski said, “some of the largest firms, because of mergers and acquisitions during the crisis, have become even bigger and is that the type of financial system that is in the best interest of the nation and is that the type of financial system that is going to provide small businesses nationwide with ready access to credit?”

Free and open to the public, the lecture begins at 7 p.m. in the Orgill Room of Clough Hall.

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