ABA Banking Journal - December 2013 - (Page 4)
BY Jeff Plagge
changes in bank regs
will help the economy
"Regulators and legislators
need details on how excessive
regulation is preventing
you from doing everything
you can to help the
President and CeO,
Northwest financial Corp.,
arnolds Park, Iowa
ABA BANKING JOURNAL
egulatory relief and a reduction in
our compliance burden are what
every bank needs-and what the
American economy requires if we're going
to get back to the business of banking and
start growing our way back to prosperity
and full employment.
We're probably not going to get any key
legislative solutions to excessive regulation
in the current Washington environment.
But with your help, we can work the issue
from the fringes through regulatory agency
corrections, reminding regulators and legislators that meaningful changes in bank
regulations can help get the economy off
its low-growth trajectory. Together, we can
make a difference.
Let me give you some background, and
tell you what you can do to help.
In early October, ABA President and
CEO Frank Keating wrote to the federal
regulators, enumerating six agenda items
they could take action on that would make
it easier for banks to serve customers,
grow communities, and create jobs. Here,
in brief, are the issues Frank identified:
1. Remove punitive regulation of mortgage servicing assets.
2. Implement the Volcker Rule in a way
that doesn't impose additional compliance
obligations for community banks.
3. Implement a more robust, independent ombudsmen program in each agency.
4. Simplify and refocus call reports
back to their original intent.
5. Allow limited distributions for S-Corp
bank shareholders to pay taxes on earnings.
6. Acknowledge the competitive and
systemic disadvantages that community
banks face in competing against credit
unions and the Farm Credit System.
As part of a continuing process, Frank
and I led two delegations of bankers
attending ABA's Community Bankers
Council fall meeting to the top of the
regulatory ladder. We met separately with
Comptroller of the Currency Tom Curry
and FDIC Chairman Martin Gruenberg.
Bankers participating in each meeting
offered specifics on how one or more of
the six regulatory issues affect their banks.
At the FDIC, for example, I spoke about
the impact of the restrictive Basel III
mortgage servicing rules and how they
would eventually straitjacket community
banks, like my own, and negatively impact
customer service and relationships.
As Frank put it, we were respectfully
noisy and insistently factual. The regulators listened to our concerns. Comptroller
Curry and Chairman Gruenberg-and their
staff members-took notes. Other bankers will be meeting with Federal Reserve
Board Gov. Jerome Powell in December.
The next step is up to you. We urge you
to get engaged and write to your regulators. Give them the specifics on how one
or more of these six items prevents you
from serving your customers and growing
your communities. Anecdotes, examples,
and details are vitally important.
Send copies of your letters to your congressional delegation. Regulators and legislators need to hear from you, and they need
specific details on how excessive regulation
is preventing you from doing everything you
can to help the American economy grow.
Utilize the recently introduced Amplify
tools to help (amplifybankers.com).
This is just the start of a drumbeat of
regulatory fixes that need to be brought
to light and corrected for the benefit of
consumers, banks, and our economy. If
you have other items that make no sense
and just confuse your employees and customers, email me at email@example.com. n
Table of Contents for the Digital Edition of ABA Banking Journal - December 2013
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ABA Banking Journal - December 2013