FOR IMMEDIATE RELEASE
ICBA Says Bold Action Needed to End Too-Big-to-Fail, Regulate Systemic-Risk Institutions
Washington, D.C. (March 24, 2009)—The Independent Community Bankers of America (ICBA) today urged Congress to take bold and immediate action to address systemic-risk institutions while also calling for an effective systemic-risk regulator and ongoing support for our nation’s dual state and federal banking system.
“Community bankers have spent the past 25 years warning policymakers of the systemic risk presented by the unbridled growth of the nation’s largest banks and financial firms,” said Bill Attridge, president and CEO of Connecticut River Community Bank, Wethersfield, Conn., in his testimony to the Senate Committee on Banking, Housing and Urban Affairs. “Congress should require the financial agencies to identify, regulate, assess and eventually break up institutions posing a risk to our entire economy. This is the only way to protect taxpayers and maintain a vibrant banking system where small and large institutions are able to compete fairly.”
The majority of our nation’s more than 8,000 Main Street community banks are well-capitalized, highly regulated and poised to overcome the economic crisis because they didn’t participate in the high-risk practices that led to the economic crisis. Attridge said that ICBA strongly supports the creation of an effective systemic-risk regulator for larger institutions because such an agency would provide valuable regulatory checks-and-balances and could promote best practices among the agencies. Congress should direct the systemic-risk regulator to block any merger that would result in the creation of a systemic-risk institution.
ICBA also called on Congress to maintain the dual banking system. “The U.S. banking regulatory structure has served this nation well for over three generations,” Attridge said. “Multiple charter options, both federal and state, are essential to preserve and innovate a resilient regulatory system.”
ICBA appreciates the opportunity to testify today and looks forward to working with Congress on these critical issues.
Read the full testimony at www.icba.org.