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Dear Community Banker:

Let's all be absolutely clear: ICBA firmly believes in the fundamental importance of maintaining the dual banking system and charter choice. These are policy principles we vigorously uphold every day as the debate over financial regulatory restructuring builds steam in Washington.
In recent days, national news reports speculated that the administration might propose a monolithic banking regulator that would oversee the nation’s financial system. ICBA acted immediately by issuing a blistering public statement opposing the idea. Our press release was picked up by news and media outlets throughout the country.

We expect this issue to dominate ICBA’s advocacy agenda this year and next year as well. Rest assured that ICBA is engaging directly with policymakers at the highest levels in Congress and the administration to make sure they fully understand the dangerous repercussions that a total concentration of financial regulatory power into one agency would have on the nation's community banks and our banking system at large. 

Having both state and federal regulators creates a flexible system of checks and balances that promotes innovation, preserves consumer choice and fosters overall systemic resiliency. In fact, our dual banking system has served our nation in times of prosperity and crisis remarkably well for nearly 150 years. Like maintaining a strong and trusted federal deposit insurance system, the dual banking system and charter choice are among the core principles of ICBA. They are central to the franchise value of the nation’s community banks. These are principles upon which we will never compromise. ICBA is totally focused on the best interests of our nation's community banks and Main Street America.

As policymakers begin to debate the direction of financial regulatory reform, ICBA remains the only national banking trade association that has offered specific proposals as to what steps should be taken and what steps should not be taken to enhance and protect the community banking franchise within any new regulatory structure that might be created. ICBA supports the creation of systemic risk regulations to end excessive financial concentration, which includes downsizing the largest financial institutions, creating a systemic-risk regulator and establishing a separate systemic risk fund, so that community banks are never again asked to pay for the sins of Wall Street.

Advocacy in Washington is an ongoing process. ICBA meets continuously with key policymakers to explain why multiple federal regulators and strong state banking systems are essential to our nation’s financial health and prosperity. We presented our recommendations in testimony before Congress four times during the past eight months, and we are in regular and frequent contact with the Obama administration on the issue, including Treasury Secretary Timothy Geithner, FDIC Chairman Sheila Bair and even President Obama himself.

In fact, ICBA has been working very closely with President Obama and his top advisors since the Inauguration to tell the community banking story. ICBA has been heartened by the broad support the administration has given to community banks and core community banking issues—from the administration's understanding and acknowledgement that community banks were not the cause of our current financial crisis, to the administration's appreciation that community banks can be the solution to getting our nation out of the crisis.

While remembering that Washington is a city filled with both information and misinformation, and that any proposal to create a single banking regulator will have a very long, uphill climb and many obstacles to overcome, we are taking nothing for granted on this issue—and neither should you. Join with ICBA to help create a bank regulatory system that recognizes the importance of community banks and Main Street America, and gives all community banks enforcement parity, proportional regulation and equal access with the Wall Street firms. With the help of our member banks, ICBA will continually remind policymakers in Washington that "Wall Street is not the only street in America that counts." 

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