Competition in the banking industry is taking a back seat to survival.

Amid the most tumultuous market since the Great Depression, the safeguards that typically make merging banks and financial institutions wait while federal regulators sift through millions of pages of documents, solicit comments from affected customers and, frequently, hold hearings on a merger's impact have been tossed out the window.

Mergers of industry giants -- which once would have needed months to win approval -- are waved through in days. Before the market tanked, regulators took almost six months to review Bank of America Corp.'s acquisition of Countrywide Financial Corp.

The Department of Justice didn't issue a separate approval of the deal but analyzed the markets one by one where both institutions operate and only then advised the Federal Reserve Board that it had no competitive concerns.

The Fed approved the merger June 5.

Now, with the markets in disarray and regulators desperate to shore up collapsing balance sheets, giant deals are being approved like greased lightning. Fed approval of Wells Fargo & Co.'s acquisition of Wachovia Corp. was announced Oct. 12, 10 days after the deal was signed and three days after Citigroup Inc. dropped a rival bid. Mitsubishi UFJ Financial Group Inc. won Fed approval to acquire a 20% stake in Morgan Stanley on Oct. 6, just one week after the investment was announced.

The priority on speed is particularly evident at the Department of Justice, which reviews bank mergers for antitrust concerns. In both the Wachovia and Morgan Stanley deals, the Justice Department expedited antitrust approval at the request of the companies.

The DOJ ostensibly has the authority to block a bank merger, but in reality its examinations are limited to the impact on local markets. If the agency sees a problem, it will recommend branch divestitures to the Federal Reserve Board or other banking regulators rather than ordering sales itself.

With the Federal Reserve and the Treasury Department preoccupied with keeping the nation's economic heart pumping, there's little concern right now about the number of branches in any given town.

Bank regulators keep a close watch over the industry, and there's rarely a conflict with the Justice Department, says Donald Russell, a former DOJ regulator and a founder of Robbins, Russell, Englert, Orseck, Untereiner & Sauber LLP in Washington. "Theoretically, DOJ can sue to block a merger or require divestitures," Russell says. "But I'd be pretty surprised if it did."

Indeed, the DOJ hasn't brought a bank merger case since 1993.

According to DOJ staff economist Gregory Werden, the agency reviews about 600 bank mergers each year. The DOJ even has a step-by-step worksheet on its Web site that will help banks predict the antitrust outcome of a potential deal. Only about once a year does the agency order a divestiture, according to Werden.

The Justice Department wasn't always so easygoing. In fact, a seminal antitrust case resulted from the DOJ's challenge of a bank merger in the early 1960s.

When Philadelphia National Bank sought to acquire rival Girard Trust Corn Exchange Bank, the government went to court, arguing that the buyer's market share would balloon from 25% to about 39%. The case went to the Supreme Court, which ruled in 1963 that local bank competition is the appropriate market for antitrust regulators' focus because people were unlikely to travel for banking services.

The Supreme Court issued a similar ruling in another case four years later.

Today the Internet has made the assertion that deposits and lending don't travel seem laughably out-of-date. Indeed, neither federal banking case could be successful today because the relevant markets are now much broader. As a result, it's no surprise that federal regulators have approved much larger, sweeping consolidation in the financial industry.

In this time of chaos, perhaps it's time for the DOJ to update its bank merger policy.

Cecile Kohrs Lindell covers antitrust for The Deal.