Beware of the risks of regulatory “overreach” and the all-purpose approach to community banking oversight, several industry participants testified at a hearing on Wednesday (February 5).
The 119th Parliament has begun and The latest iteration of the House Committee on Financial Services has been seated,, Chairman's hearing R-Ark. French MP Hill was entitled “Make Community Banking Great Again.”
Testimony and question-Answers with rough marks 4 hours Hearing, bankers and state banking regulators told lawmakers that steps should be taken to facilitate the path to a new banking system (de novo bank). and Testimony from some participants said Congress should also look to abolish the Consumer Financial Protection Bureau (CFPB) rules related to overdraft fees and collection of lending data for small and medium-sized businesses, and open banking rules We need to argue that we should also be delayed.
in His opening statement, Hill said, “”I want to bring the vision of bankers and businessmen to the committee. And he said the bank roster has been shrinking in the US over the past decades, with 82 De Novo Bank Charters being issued since 2010.
“The increased regulatory requirements force community banks to devote more resources to lawyers and checkbox compliance programs instead of serving customers,” Republicans said. I insisted.
And along those lines, starting a new bank means walking around throughout the years and being expensive A process that spans several institutions. Witness Patrick J. Kennedy Jr. Kennedy Sutherland's founding partner and executive chairman of Transpecos Bank, Decrease in bank charters This was the trigger for the Dodd Frank Act in 2010.
Testimony from Rebeca Romero RaineyPresident and CEO of Independent Community Bankers in America,, I assumed that Regulatory obligations designed for systematically dangerous and mass-based; Transaction-based The agency “is a poorly suited and actually a disruptive community bank.”
She warned of the “all-all” regulatory approach that bears small banks It has They have relatively fewer resources on hand, including legal and compliance teams than major banks (and consolidation is inflated the ranks of large banks).
Proposals to lawmakers
Her testimony also highlighted her opposition to her organization's credit card routing mandate. thatadding additional cost burdens through compliance as part of the law that could come before the current legislation.
Susanna MarshallThe Arkansas Bank Director General said community banks face growing regulatory requirements. she I recommend it Federal regulators will “directly engage” with state supervisors in developing regulatory frameworks.
R-Mich. When asked about risks and regulations by Rep. Bill Huizenga of Marshall, noted that community bank regulations are “the best of the heart.” and Later in the session, Romero Rainey responded to the issue of nuance, due to de novo banking, and One size fit –all The charter doesn't reflect that “the Oklahoma community doesn't look the same as downtown New York.”
Kathy OwenPresident, CEO and executive chair of the state holding company of Eagle Bank & Trust Company in Little Rock, Arkansas New rules hosts have been introduced CFPB proves harmful to community banks for the past few monthsand the council As a result, banks will naturally be forced to complete overdraft services, and therefore need to move CFPB's efforts to cap overdraft fees to stymie. The industry's “rational regulations” also involve placing the CFPB under the legislative spending process, she said.
Take another tack, Mitoria Wilson Spottervice president, center For responsible loans, That committee In CFPB, in fact, Rules (such as overdraft and business data collection rules) are tailored to the size and complexity of the various FIs.
Between her His own The recommendation was to raise the deposit insurance cap for SMEs accounts. Need FinTech complies with existing consumer compliance laws. This levelles the playing field between these digital startups and community banks.
