Powerhouse banking companies are rapidly gaining share in California as buyers of last resort for failed banks, potentially setting the stage for fierce competition in the nation's most populous state.

But key players involved — including U.S. Bancorp and Wells Fargo & Co. — said they welcome the change in the competitive landscape because it comes with what they view as a notable benefit: the exit of struggling competitors that specialized in risky mortgage lending and irrational deposit pricing.

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