Interstate Banking Definition
Interstate Banking is
banking across state lines. Since the 1980s banks are allowed to acquire
out-of-state banks, thus regional and national banking chains could be
developed. The first phase of the process was forming regional banks when
smaller banks in a region merged to larger institutions. The next step took
place when mergers with banks in any other state were allowed. Nowadays banks
meeting certain capitalization requirements may acquire other banks in any
other state.