From afar, America looks like the land of opportunity – and for no one more so than European banks. With its large population, a banking sector fragmented into thousands upon thousands of institutions, and fee-friendly consumers who think nothing of paying $30 for a new set of cheque books, it seems to offer everything Europe doesn’t: high margins and room for growth. Never mind that its lure has proved fatal in the past. “Historically the US has been a graveyard for foreign bank capital,” says Chris Ellerton, an analyst at UBS. “In the 1980s, the UK banks all bought US banks and generally sold them again at a loss.”
But now European banks are back and, helped by the weakness of the dollar, are participating in the frenzy of US bank consolidation with aplomb. Retail banking is in – and the Europeans are determined to be a part of it.
