Nov. 9 (Bloomberg) -- French Finance Minister Christine Lagarde asked Financial Stability Board Chairman Mario Draghi to look into whether consolidation in the banking industry stemming from the global financial crisis is hurting competition, particularly in the U.S.

The FSB must look into “competition in a situation which is consolidating and forming real oligopolies for some products and some markets,” Lagarde said today at a press conference in Brussels after a regular meeting of euro-area finance ministers. In the U.S., the number of large investment banks has shrunk to three from six before the crisis, and more than 100 retail banks have gone bankrupt or are seeking protection from creditors, boosting market shares for survivors, she said.

“All this isn’t without an impact on competition,” Lagarde said, adding that the way banks apply recommendations on bankers’ pay adopted by the Group of 20 nations must also be looked into by the FSB. “All this is worth looking into, especially in a backdrop where some of these large operators over there, or here, are on steroids, that is to say constantly on public-fund injections,” Lagarde said.

Leaders of the G-20 nations have turned to the FSB, which two years ago was just an advisory group, to draw up a blueprint for revamping the financial industry after the worst crisis since the 1930s. In September, the G-20 adopted proposals from the FSB on limiting bankers’ pay and tighter bank capital rules. Draghi is due to report on the implementation of G-20 decisions in March, according to Lagarde.

Record Bonuses

Goldman Sachs Group Inc., Morgan Stanley and JPMorgan Chase & Co.’s investment bank will hand out a record $29.7 billion in bonuses, according to analysts’ estimates. That is up 60 percent from last year and more than the previous high of $26.8 billion in 2007.

On Nov. 7, Draghi said some banks became dependent on measures by governments to cope with the financial crisis and authorities should not make the mistake of supporting them indefinitely. Governments around the world spent more than $400 billion to bail out banks over the past two years, as the global crisis caused $1.7 trillion in credit losses and writedowns.

To contact the reporter on this story: Francois de Beaupuy in Brussels at fdebeaupuy@bloomberg.net

Last Updated: November 9, 2009 17:30 EST