I have a couple of larger banking customers and this is 100% what happens. One of mine is so good at doing it, that the govt essentially gives them first right of refusal in purchasing these failed banks because they can integrate and take over quickly.

Wife’s grandfathers is on the board at a small bank. FDIC loves them now because stayed small and makes good loans. Same strategy was gettin true chastised in 2005.

Oh great. Further centralization and bigger monopolies

How about Credit Unions? Are they considered small industry-specific players?

This consolidation towards the top is described as a feature for the Federal Reserve cartel in The Creature From Jekyll Island by Edward Griffin. When formed, one of the key tenants of the Fed was to stop the growth of competitive banks. These failures are a part of their cartel plan.