Financial groups: 'Too big to fail' is dead and buried

But the financial groups say those fears are misplaced, and argue a recent study that found big banks enjoy a roughly $83 billion subsidy is "based on flawed methodology, and on the extrapolation of stale and unreliable financial market data."

That study, an International Monetary Fund working paper, calculated that big bank size drove down borrowing costs by roughly 0.8 percentage point. A Bloomberg editorial applied that savings rate to the total liabilities of the nation's 10 largest banks, and determined that big banks are reaping an annual subsidy of $83 billion a year thanks to their size.

Those findings hit the spotlight when Sen. Elizabeth WarrenElizabeth Ann WarrenOvernight Finance: Lawmakers grill Equifax chief over hack | Wells Fargo CEO defends bank's progress | Trump jokes Puerto Rico threw budget 'out of whack' | Mortgage tax fight tests industry clout Michelle Obama is exactly who the Democrats need to win big in 2020 Wells Fargo chief defends bank's progress in tense Senate hearing MORE (D-Mass.) used them to grill Federal Reserve Chairman Ben Bernanke on the state of big banks and "too big to fail," arguing that those banks should be required to pay back that perk to the government.

"These big financial institutions are getting cheaper borrowing to the tune of $83 billion in a single year simply because people believe that the government would step in and bail them out," she said a Senate Banking Committee hearing. "And I'm just saying, if they're getting it, why shouldn't they pay for it?"

Bernanke conceded that markets do still perceive major financial institutions as in line for a government bailout if they collapsed, but called those expectations "incorrect."

The Fed chairman said the the Dodd-Frank financial reform law gives regulators tools they didn't have during the last crisis to take apart failing financial institutions, eliminating the need for future bailouts for the good of the financial system. Over time, markets would come to realize that, he said.

He also cast doubt on the accuracy of that study in question.

"That's one study, senator," he said. "You don't know whether that's an accurate number."

"Chairman Bernanke's skepticism regarding the editorial's headline number is well-founded," the industry groups argued in their takedown.

The groups cited another IMF study, which found big banks enjoy a funding advantage of about 20 basis points, or 0.2 percent. And even that study fails to take into account Dodd-Frank reforms, which further eliminated the subsidy, and may even be driving a funding penalty on big banks, they contend.

Monday's statement was signed by the Financial Services Forum, Financial Services Roundtable, American Bankers Association, Securities Industry and Financial Markets Association and The Clearing House.

Sens. Sherrod BrownSherrod Campbell BrownDems plan to make gun control an issue in Nevada Mandel leads GOP primary for Ohio Senate seat: internal poll Red-state Dems need more from Trump before tax embrace MORE (D-Ohio) and David VitterDavid VitterYou're fired! Why it's time to ditch the Fed's community banker seat Overnight Energy: Trump set to propose sharp cuts to EPA, energy spending Former La. official tapped as lead offshore drilling regulator MORE (R-La.), who have advocated for the break up of the nation's largest banks, were unconvinced by the industry effort.

The two said there is ample proof big banks still enjoy a subsidy thanks to their size, and an industry push to dissuade that should have no impact.

"Despite the claims made by the paid cheerleaders of the megabanks, Too Big To Fail is alive and well, and the banks receive taxpayer subsidies,” said Vitter. “Chairman Bernanke knows it, the market knows it, and the taxpayers know it."

This post updated at 2:50 pm.