July 2, 2013
CBAI leadership bankers and staff met with Illinois Senator Richard Durbin to discuss issues of importance to Illinois community banks. Bank of Springfield hosted this roundtable discussion during the Senate’s July 4th recess.
The common theme expressed by leadership bankers from CBAI’s first Chairman, Art Murray of Citizens State Bank in Milford (1974-1975), to CBAI’s current Chairman, Rick Jameson of Morton Community Bank (2012-2013), was the stifling impact of over regulation/examinations and unfair competition on the ability of community banks to serve their communities.
CBAI bankers thanked Senator Durbin for co-sponsoring the Terminating Bailouts for Taxpayers Fairness Act (S. 798) and encouraged him to take a strong leadership position in moving this important legislation forward. The Brown-Vitter bill would establish more appropriate capital standards for the nation’s largest financial institutions and provide much needed regulatory relief for community banks. CBAI’s top Federal Policy Priority is addressing the issue of too-big-to-fail. Taxpayer bailouts must never happen again.
CBAI bankers encouraged additional progress by both regulators and legislators on differentiating community banks from too-big-to-fail financial institutions. The group emphasized that the business model and risks of large, complex and interrelated financial institutions is completely different than community banks, and painting the industry with a broad regulatory brush is inappropriate; community banks are nothing like the large financial behemoths and future legislation and regulation should reflect that fact.
CBAI’s past Chairman Robin Loftus (Security Bank, S.B., Springfield) shared her recent experiences as the current Chairman of the Consumer Financial Protection Bureau’s (CFPB) Community Bank Advisory Council. While the CFPB’s examination and enforcement authority is limited to banks in excess of $10 billion in assets (and the shadow financial industry), input from the Advisory Council is vital to the Bureau’s rule writing. Loftus identified several areas where their input has already been beneficial in avoiding inappropriate regulation.
CBAI staff also addressed other opportunities for Senator Durbin to co-sponsor legislation in the Senate which would help reduce the regulatory burden for community banks. David Schroeder, Vice President Federal Governmental Relations, will be discussing these opportunities in greater detail when he visits members of the Illinois Congressional delegation in Washington later this month.
CBAI leadership bankers and staff thanked Senator Durbin and his capable staff for attending the roundtable discussion.