Washington, D.C. , 30 August 2016 — The Independent Community Bankers of America® (ICBA) today urged the U.S. Senate to seize on consensus support for tailored community bank regulation. In a letter to 70 senators who recently called on the Consumer Financial Protection Bureau to consider the impact of its rules on community-based financial institutions, ICBA outlined a list of pending bills that support local economic and job growth.
“Your letter was signed by an impressive bipartisan coalition of 70 senators, which is testimony to the powerful consensus behind tailored, or tiered, regulation,” ICBA President and CEO Cam Fine wrote. “ICBA urges the Senate to seize on this rare consensus by enacting legislation before the close of the 114th Congress that would promote tiered regulation of community banks.”
While CFPB Director Richard Cordray recently responded to the senators by listing several agency rules with community bank accommodations, his letter doesn’t tell the full story, ICBA wrote. What’s missing is any recognition of the cumulative impact of the CFPB’s more than 5,000 pages of rules and regulations on local institutions and the communities they serve. The nation has lost nearly 2,000 community banks in the past seven years, and only four new banks have been formed, indicating that rising regulatory burdens have increased concentration in the financial industry.
“Every regulatory change requires software updates, testing, and training, as well as legal and audit expenses,” Fine wrote. “The process of reading, evaluating, and determining the organizational impact of a 1,000-page rule is in itself a significant expenditure of staff time. And even rules that include community bank exemptions generally still require some form of compliance.”
Several pending Senate bills would implement provisions from ICBA’s Plan for Prosperity legislative platform to relieve community banks of excessive and unnecessary regulatory burdens. In its letter, ICBA cited the CLEAR Relief Act (S. 812), CLEAR Relief Plus Act (S. 927), Community Bank Access to Capital Act (S. 1816), CFPB Examination and Reporting Threshold Act (S. 482) and other Senate bills that would help community-based institutions reinvest and create jobs in their communities.
The Independent Community Bankers of America®, the nation’s voice for more than 6,000 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.