Restricting the Power to Promote Competition in Banking: A Foolish Consistency Among the Circuits

In several recent decisions the federal appeals courts have adopted a standard for reviewing denials of proposed bank combinations which substantially restricts the ability of federal bank regulators to reject anticompetitive combinations. Professor Carstensen analyzes the three leading decisions and the litigating positions of the parties. He argues that the results in these cases, although predictable, are inconsistent with express statutory language, legislative history, past Supreme Court construction of the relevant standard, and the fundamental public policy of avoiding unnecessarily anticompetitive combinations. He suggests two ways in which the statute could be read which would preserve reasonable judicial review of agency decisions without sacrificing the substantive public interest in promoting competition.