Community Banking Victory!!
Wal-Mart Pulls Its Industrial Loan Company Application
ICBA and the nation's community banks are cheering Wal-Mart's decision to withdraw its application for federal deposit insurance for a Utah-based industrial loan company (ILC).
"America's consumers and America's communities are the true winners," said James P. Ghiglieri Jr., ICBA chairman and president of Alpha Community Bank, Toluca, Ill. "ICBA has fought long and hard to preserve the economic diversity necessary to sustain vibrant and dynamic communities and to protect the safety and soundness of America's deposits."
"A Wal-Mart bank-owned by the world's largest commercial retailer—is the poster child for what could go wrong and would pose significant risk to the safety and soundness of the Deposit Insurance Fund and to the stability of our financial and economic system by breaching the long-standing wall between banking and commerce," said Camden R. Fine, ICBA president and CEO. "Congress now needs to act quickly to address other pending commercial ILC applications and possible future applications by closing the ILC loophole and passing the Frank-Gillmor legislation."
Despite Wal-Mart's decision to withdraw its ILC application, ICBA will continue to fight to close the ILC loophole and work diligently with Congress to pass the Industrial Bank Holding Company Act (H.R. 698) introduced by Reps. Barney Frank (D-Mass.) and Paul Gillmor (R-Ohio) and co-sponsored by 86 members of Congress. The measure would close the ILC loophole in the Bank Holding Company Act and prohibit Wal-Mart, Home Depot and other non-financial companies from using an ILC charter to skirt the law preventing commercial firms from owning FDIC-insured financial institutions.
ICBA continues to urge community bankers and their staff to send letters and e-mails to their House representatives to co-sponsor H.R. 698. Take advantage of ICBA's online resources on the ILC issue, which includes a link to send a letter to a member of Congress. Read ICBA Statement.