The large banks are more heavily regulated. Trump raised the limit at which a bank is called large from 50bil to 250bil. The small banks value their freedom from regulation more than they would value full FDIC coverage. The fed would love to make that trade:more regulation of small banks in exchange for full FDIC coverage for small banks.

Canada is dominated by five enormous banks, they are closely regulated, and Canada has had a better experience than USA with both fewer bank failures and higher real interest rates paid to customers.