FOR IMMEDIATE RELEASE
ICBA Applauds Congressional Call for ILC Moratorium
98 Members of Congress Ask the FDIC to Hold ILC Approvals
Washington, D.C. (June 8, 2006)—The Independent Community Bankers of America (ICBA) applauds Rep. Paul Gillmor (R-Ohio), Rep. Barney Frank (D-Mass.) and the 98 members of Congress who have asked the Federal Deposit Insurance Corp. to put a hold on approving any applications for deposit insurance for commercial enterprise-owned industrial loan corporations (ILC) until Congress has an opportunity to consider the issue.
"ICBA continues to be concerned that ILCs owned by commercial enterprises breach the wall that separates commerce and banking," said Terry J. Jorde, ICBA chairman and president and CEO of CountryBank USA, Cando, N.D. "These members of Congress recognize the potential dangers to our nation's communities and the need to fully examine how the ILC charter is expanding beyond Congress' original intent." Congress intends to examine the ILC issue later this year.
In a letter to the FDIC, 98 members of Congress asked for the moratorium because they are concerned that opening the ILC floodgates to let commercial enterprises into banking will send U.S. economic policy down a destructive and irreversible course. "Their concern is understandable considering the pending ILC applications filed by Wal-Mart and Home Depot, the nation's two largest retailers. If the giant retailers are allowed into banking using the ILC loophole, a parade of commercial companies will surely follow and change the banking landscape completely," said Camden R. Fine, ICBA president and CEO.
ICBA has been leading the way in efforts to maintain the separation of banking and commerce and to close the ILC loophole in the Bank Company Holding Act. The principle and practice of keeping banking and commerce separate has served the nation and local communities well by guarding against excessive concentration of economic power, ensuring the impartial allocation of credit and safeguarding against improper extension of the bank insurance safety net and risks to the Deposit Insurance Fund.
For more information on this issue and to view the letter, visit www.icba.org.