FOR IMMEDIATE RELEASE
State Banking Associations Unite to Endorse Frank-Gillmor Bill to Close ILC Loophole
Measure Would Keep Commercial Firms Out of Banking
Washington, D.C. (March 21, 2007)—All 87 state banking trade associations representing all charter-types and sizes endorsed an Independent Community Bankers of America (ICBA)-supported measure that would close the industrial loan corporation (ILC) loophole to keep commercial firms out of banking.
"The Frank-Gillmor bill would maintain the separation of banking and commerce by preventing commercial firms from acquiring or establishing industrial loan companies," said James P. Ghiglieri, Jr., ICBA chairman and president of Alpha Community Bank, Toluca, Ill. "And while Wal-Mart has withdrawn its application to open a bank, there are still commercial firms waiting in the wings with pending applications. That's why state community bank associations throughout the country want Congress to quickly pass legislation to preserve the separation of banking and commerce."
The Industrial Bank Holding Company Act (H.R. 698), introduced by House Financial Services Chairman Barney Frank (D-Mass.) and Ranking Member Paul Gillmor (R-Ohio) - and cosponsored by nearly 100 members of Congress - would permanently close a loophole in the Bank Holding Company Act by prohibiting Wal-Mart - which recently withdrew its application for an ILC - Home Depot and other commercial firms from ever owning an industrial bank, and ensure that all industrial bank holding companies are adequately regulated.
ICBA has long supported our nation's policy of keeping banking and commerce separate to avoid economic concentration and conflicts of interest and to protect the safety and soundness of our financial system.
"The over concentration of economic power diminishes consumer choice and smothers small businesses and job creation," said Camden R. Fine, ICBA president and CEO. "ICBA stands for the separation of banking and commerce so that America's economy remains diverse and rich in choice for all consumers and businesses alike. It's time to close the ILC loophole and to provide proper regulation and supervision of ILC holding companies by the FDIC, which this bill would achieve."
Read the state associations' endorsement letter at www.icba.org.