Regional banks have shelled out more and more to depositors to get them to stick around. For many, that still hasn’t been enough.

After an ugly third quarter, banks rolled out plans last week to try to shrink themselves back to health. Profits dropped by double digits from a year earlier at a number of them, including 44% at KeyCorp, 32% at Citizens Financial and 28% at Truist Financial. …

Megabanks have also had to pay more for deposits, but so far it hasn’t been nearly as painful for them. JPMorgan Chase, Bank of America, Wells Fargo and Citigroup collectively earned about $30 billion in the third quarter, a 27% increase from a year earlier. They have the cushion of big operations in businesses such as trading, investment banking and wealth management.

[Gee, remember when the solution to “too big to fail” was to add more government regulation through Dodd-Frank? We warned repeatedly at the time that this was rent-seeking regulation that would penalize smaller banks through compliance costs and force even more consolidation in the industry. And here we go again, now catalyzed by the rapid increase in Federal Reserve interest rates. — Ed]