The role of community banks in advancing and sustaining the recovery is jeopardized by the increasing expense and distraction of regulation drastically out of proportion to any risk we pose.
Washington, DC (PRWEB) July 15, 2014
The Independent Community Bankers of America® (ICBA) today called on Congress to pass legislation to rein in excessive government regulations that are inhibiting economic growth, including the Justice Department’s Operation Choke Point initiative. Testifying before the House Financial Services Subcommittee on Financial Institutions and Consumer Credit, ICBA community banker Sam Vallandingham continued ICBA’s call for tiered regulations that are tailored to the size and complexity of financial institutions.
“As the economic recovery strengthens, small businesses will lead the way in job creation with the help of community bank credit,” said Vallandingham, president and CEO of The First State Bank in Barboursville, W.Va. “But the role of community banks in advancing and sustaining the recovery is jeopardized by the increasing expense and distraction of regulation drastically out of proportion to any risk we pose. Community banks didn’t cause the recent financial crisis, and we should not bear the weight of new, overreaching regulation intended to address it.”
Vallandingham said ICBA appreciates Congress’ focus on community bank regulatory relief and expressed the association’s support for three bills before the committee designed to mitigate government overreach in the realms of law enforcement, arbitrary capital requirements, and rigid and expensive appraisal rules. The ICBA-advocated measures include:
- The End Operation Choke Point Act of 2014 (H.R. 4986), which would rein in the Justice Department’s abusive use of subpoena authority and help preserve the ability of banks to serve legal and legitimate business customers without undue pressure from law enforcement or examiners,
- The Community Bank Mortgage Servicing Asset Capital Requirements Study Act of 2014 (H.R. 4042), which would require the banking regulators to stop and study ill-conceived Basel III mortgage-servicing rules scheduled to take effect in less than six months, and
- Draft legislation to exempt certain loans held in portfolio from new appraisal requirements to promote the continued flow of mortgage credit to moderate-income borrowers and strengthen the housing recovery.
All three measures are sponsored by Rep. Blaine Luetkemeyer (R-Mo.), a former community banker who understands the impact of government overreach and regulation on community banks, their customers and their communities. ICBA thanks Rep. Luetkemeyer for his continued attention to Main Street communities and locally based economic growth and Chairman Shelley Moore Capito (R-W.Va.) for holding today’s hearing. The association also looks forward to continuing to work with Congress on these bills as well as measures inspired by ICBA’s Plan for Prosperity regulatory relief platform.
The Independent Community Bankers of America®, the nation’s voice for more than 6,500 community banks of all sizes and charter types, is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education and high-quality products and services. For more information, visit http://www.icba.org.