Community Bankers Association of Illinois

Ghiglieri Addresses Delegation on "Who Speaks for You?"

    Note: On Friday, September 28, 2007, ICBA Chairman Jim Ghiglieri of Toluca addressed the community banker delegation during CBAI's 33rd annual convention in Memphis. Here are excerpts from his speech titled, "Who Speaks for You?"

     I'm proud to be a community banker. And I'm proud of what ICBA [Independent Community Bankers of America] is doing for community banking.

     This is a day that I have looked forward to since I moved into the chairs of ICBA. To be here with all of our friends from Illinois, speaking to you as Chairman of ICBA is a very special moment for Mary Kay and me.

     I would never have had this opportunity to serve our industry as Chairman of ICBA had it not been for the wonderful experiences I had at the state level with CBAI. I served as President of CBAI 10 years ago after having served on CBAI committees for many years. The life-long friendships that I have made with so many of you is something that I will always cherish…

     Banking is in my blood and in fact, I'm a third generation community banker… Being a community banker means I'm able to be with you here today, my fellow community bankers from the great State of Illinois…

     So let's talk a little bit about our association… Independent Community Bankers of America is a mouthful, but it says it all! ICBA embodies the hopes, dreams, and diverse values of thousands of community banks of all charter types, and, by extension, the communities and customers they serve.

     ICBA is the largest community banking association in the United States representing a significant majority of the chartered banks in this nation. Our nearly 5,000 member banks can be found in every state in the nation and in two U.S. territories...

     Consider for a moment a nation without ICBA's exclusive representation of the community bank franchise. Reminiscent of Bedford Falls without George Bailey in "It's A Wonderful Life", what would the U.S. Banking System look like without ICBA? Would our hometowns be controlled by the Mr. Potters - the Wall Street mega banks and nonbank financial firms? Would there even be a Main Street?

     But what about the banking industry in America today? What does it look like? Let me share some information with you:

     According to the FDIC there are now over $11 trillion dollars of total assets in FDIC insured institutions. At the end of the first quarter of 2007 just three banking companies controlled over $5 trillion of the $11 trillion in banking assets - or nearly 42% in just three of 8650 insured banks. That means that less than one half of a percent of chartered banks control 42% of the nation's assets. The top 150 banking companies -- or just 1.75% -- control over 80% of the nation's banking assets.

   I'm often asked by fellow bankers why there needs to be an ICBA - wouldn't it be better if there were just one banking association and we all worked together? In fact, I'm going to repeat the mantra I've been hearing lately, "Wouldn't it be better if we all spoke with one voice?"

     My answer to that is, "Whose Voice?"

     Well, the reality is there are dozens of national and state financial trade associations representing the many different constituencies within our financial system.

     For example, the Consumer Bankers Association represents retail lenders such as credit card banks and auto finance lenders. The Mortgage Bankers Association represents mortgage lenders and the National Bankers Association represents minority-owned and women-owned banks.

     And did you know that the 100 largest financial institutions have their own trade association? It's called the Financial Services Roundtable and its members include Bank of America, Citicorp and Merrill Lynch. You can't get in if you are not in the top 100. None of us need apply even if we could afford the dues and PAC contributions.

     Has anyone suggested that they disarm these various associations and the individual lobby shops of the largest banks in the country so we can all speak with one voice?

     So, who speaks for the rest of us? Where is the voice of the community bankers among these behemoths? What about the issues unique to community banks? What happens when our views and the view from Wall Street clash?

     The bottom line is that it is impossible to have one voice for the industry. In today's rapidly changing and crowded world, everyone needs a voice speaking on their behalf and protecting their interests.

     ICBA works together with other trade associations on issues where it best serves our members interests - but on issues where community banks need a separate voice…ICBA speaks as a clear, distinct, and independent advocate for our issues and I don't think we need to apologize for it.

     This has nothing to do with being modern or progressive. And don't let anyone tell you that you're stuck in the past if you don't believe in the one voice myth.

     This has to do with state and national associations that exclusively represent our voice... the voice of the community banker. Associations that will ensure that your political representatives understand that while community banks represent only 15% of the total financial assets, they account for over 95% of the bank charters in this country!

     Time after time, ICBA has stood up for community bank interests and continues to stand up for them on the critical issues that really matter to community banks - ICBA is never shy about stating the community bank case even if all the other financial services players have very different views from you and me.

     Think about it.

     Who was the first to speak out about overwhelming and crushing regulatory burden? And the first to do something about it exclusively for community banks? Who was the first -- and at the time the only -- national bank trade association to sound the alarm about Wal-Mart's attempts to get into banking, not just now, but years ago during their first attempt to get their hands on a charter?

     Who took the lead in the fight for streamlined CRA treatment for community banks as far back as 15 years ago, when no other group was standing up against the consumer groups on the crushing burden of CRA?

     Who has fought for the rights of smaller publicly traded banking firms against Sarbanes-Oxley? Who has championed Subchapter S treatment for community banks? Who urged the Tax Foundation study on the unfair tax advantages of Credit Unions?

     The answer to every one of these questions is very simple: ICBA!

     The answers to these questions make clear who we are. ICBA IS YOU! ICBA is community banks!

     ICBA is FOUNDED on a very basic ideal - An association of community banks, for community banks and governed by community banks; an association where each bank has an equal voice - one bank, one vote; where board leadership is openly elected by its members - not appointed.

     ICBA's purpose is clear - We speak solely for community banks and only for community banks!

     This clarity of purpose allows ICBA's leadership to aggressively advance our active, positive, pro-community banking agenda in Congress and with the regulatory agencies.


     We support maintaining the separation of banking and commerce and believe in a balanced financial system that does not favor any one segment of the financial services sector over another. In that regard, we adamantly oppose excessive concentration of our nation's economic and financial resources - our industry is already concentrated enough don't you think?

     We support the dual banking system and a fair and competitive marketplace where all institutions are on equal ground and have equal access to the payments system and secondary credit markets.

     We will vigorously oppose any powers expansion for credit unions that wish to be banks until credit unions pay taxes like banks.

     Without ICBA's voice, the community bank franchise and point of view would be severely diminished or worse, not heard at all. ICBA is our advocate in Washington. That is why ICBA exists. ICBA is community banks! ICBA is YOU...

     I travel to our nation's Capitol often to represent our great association to members of Congress, administration officials, and other policymakers on your behalf. Every spring about 300 community bankers serving on ICBA Committees gather to visit with their representatives on Capitol Hill. It's important for us to do so. Direct member lobbying efforts are the most effective and the most powerful. Our political leaders want to talk with their constituents - the individuals who will ultimately be affected by the laws they enact.

     There is nothing more effective and credible to a policymaker than having everyday community bankers explain the real-life consequences of a government decision on our institutions, our customers and our communities.

   Of course, we all know there are two-sides to every issue. A lawmaker, acting in good faith, can easily, without realizing it, make a terrible decision regarding community banking if he or she isn't aware of our side of the story. So we need to be there to tell our story.

     You need to do more than just know who your elected officials are - you need to get to know them and to personally stay in touch with them at home and when they are in Washington. You need to respond to the regulatory agencies' calls for public comment. Our public officials want to hear from you, and believe me, they listen when you speak...

     Yes, there is strength in numbers and in community bankers speaking together with one voice...

     What happens in Washington while we're back home running our community banks matters enormously, but only through the efforts of each one of us can our industry remain competitive...

     In closing, let me say that my experiences of these past few years have convinced me more than ever that we have the best financial system in the world. We are well served by a country that is home to large multi-national banks as well as thousands of community banks in every corner of America. It is a unique and well-balanced system that must be carefully maintained. It is a financial system that is the envy of the world... I can say with confidence that there is no finer group of people in the world than our nation's community bankers. You represent the very best in our financial system.

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