Maher is right. Generally speaking, a wider distribution of funds ought to ensure more competition and more informed local decision making.

But I can see some potential downsides. BofA, for example, has branches all over the country. That makes it cheaper to use ATM's if you still do so. Also, they have a fantastic online banking system that is a big help with paying bills. Some people may not want to give up these bells and whistles to go back to a credit union who may not have all of them. Also, I looked into loan rates at my credit union for each of our last two cars and for our house. In all three cases, the credit union rate offered was higher than what I got after shopping around from banks. On the house, for example, I ended up getting a rather spectacular 4.25% from a very large bank (National City, now PNC) for a 15 year fixed. The credit union was able to offer something like 5.5% in the same time-frame.

There used to be many more local banks. I remember a rash of mergers and acquisitions during the 1990's (Clinton years) as the big banks went shopping for deals. And I think in terms of numbers of bank failures, some smaller banks like WaMu were hit harder than the big banks. I'm wondering if some of the bigger banks even needed stimuli? In the case of BofA, I remember articles suggesting that there were people saying they shouldn't take any.