Big banks should hope that Kenneth C. Griffin, the founder and chief executive of Citadel, never gets his hands on a magic wand.
“We don’t have a good legal justification for breaking up the banking system,†Mr. Griffin said during a discussion of universal banks, the large banks that offer an array of financial products and services. “But if I could wave a magic wand, I’d break up the banking system.â€
Mr. Griffin, who has previously criticized the way big banks spent their money during the credit boom, spoke during DealBook’s Opportunities for Tomorrow Conference on Tuesday, where he discussed regulation and other topics with the columnist Andrew Ross Sorkin. Mr. Griffin said the size of some of Wall Street’s largest institutions had created management challenges and compliance and regulatory difficulties.
Asked whether the big banks had gotten too big to fail, or too big to manage, Mr. Griffin answered “They’re both. When asked about how he’d break up some of Wall Street’s largest institutions, Griffin suggested pulling the securities businesses out of the banking system.
“I would, in a sense, de-bank Goldman Sachs or Morgan Stanley,†Mr. Griffin said.
Mr. Griffin also said that he would enforce deposit ceiling caps and would even consider lowering those caps to foster the creation of more midsize banks, which can compete for local business loans.
