Too Big to Fail & Systemic Risk (Including Systemic Risk)

The Wall Street financial crisis and government intervention of 2008 affirmed that the nation’s largest megabanks are “too big to fail”—so big and interconnected that the government will not allow them to fail.

As ICBA details in its “End Too-Big-To-Fail” study, too-big-to-fail distorts free markets, incentivizes risky behavior, leaves taxpayers on the hook, and creates unfair competitive advantages for the largest banks. Meanwhile, community banks face oppressive regulatory burdens as a direct result of megabank misdeeds.

A less concentrated and more diverse financial system would decrease systemic risk, improve competition and innovation, and increase the availability of consumer credit. ICBA and the nation’s community banks are dedicated to ending too-big-to-fail.

Articles & Press Releases

ICBA: Hold Wall Street Bad Actors Personally Accountable

Sep 30, 2013
NewsReleaseHeader2015


Washington, D.C. (Sept. 30, 2013)—Camden R. Fine, president and CEO of the Independent Community Bankers of America® (ICBA), released this statement following the recent meeting between JPMorgan Chase chief executive Jamie Dimon and U.S. Attorney General Eric Holder amid continued reports of misconduct on Wall Street.

“While JPMorgan Chase and other Wall Street firms negotiate the terms of their penalties for misconduct and violations of the law, ICBA and the nation’s community bankers urge financial regulators and the Justice Department to ensure megabank officials are held to the same personal accountability as community bankers.

“The seemingly endless number of fines and penalties that regulators continue to impose on the nation’s largest financial institutions reflects serious and harmful behavior from Wall Street to Canary Wharf. This misconduct is manifest in the fraudulent packaging and sale of mortgage-backed securities, a loss funded in part with federally insured deposits, and collusion to rig LIBOR interest rates. 

“Nevertheless, financial penalties that can be paid in full out of these megabanks’ quarterly profits are not enough to deter wrongdoing and minimize the threats these institutions pose to our nation. Unlike community bankers, who are held publicly and personally accountable by their regulators when things go wrong, not one senior Wall Street executive or board member has been held personally responsible for the 2008-10 financial collapse and the repeated scandals that have followed.

“To truly combat Wall Street’s excessively risky and reckless behavior, regulators and the Justice Department must bring financial bad actors to justice.”

About ICBA 
The Independent Community Bankers of America®, the nation’s voice for nearly 7,000 community banks of all sizes and charter types, is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education and high-quality products and services. For more information, visit www.icba.org.


Letters to Congress

Title Recipient Date
Senators Crapo and Brown
09/12/2017

Letters to Regulators

Title Recipient Date
Federal Reserve, OCC
06/12/2018
Federal Reserve, OCC
05/08/2018
Federal Reserve Bank of Minneapolis
01/17/2017
OCC, Federal Reserve, and FDIC
08/03/2016

Testimonies

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Summaries

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