Big banks may need to be broken into smaller pieces if they become too big to manage and are unable to fix significant regulatory lapses, a top federal banking regulator said in a warning shot across Wall Street on 17 January.

A bank’s failure to resolve longstanding deficiencies despite reprimands from its regulators and onerous restrictions such as caps on its growth are evidence that a firm is unmanageable and needs to be broken up, acting Comptroller of the Currency Michael Hsu said.