Washington, D.C (June 29, 2018)—The Independent Community Bankers of America® (ICBA) today called on the Treasury Department to recommend prohibiting an expansion of banking services at the U.S. Postal Service.
Today’s letter calls on President Donald Trump’s special task force on postal reform to include the recommendation in its review of the Postal Service. It follows this week’s ICBA-supported letter to Treasury from House Financial Services Committee Vice Chairman Patrick McHenry (R-N.C.) noting that Congress in 2006 barred the Postal Service from offering new, non-postal services.
“The Postal Service’s inability to manage its own primary business of selling postage and delivering mail suggests it is ill-equipped to handle any banking function,” ICBA President and CEO Rebeca Romero Rainey wrote. “The Government Accountability Office last year said the USPS reported a net loss of $5.6 billion in fiscal 2016 — its 10th consecutive year of net losses.”
Financial services are best provided in a competitive, private, and free marketplace so they can openly and efficiently benefit customers. According to the FDIC, 88 percent of banks offer small-dollar loans and 81 percent offer free counseling to underserved consumers. Community bank professionals are educated, trained and experienced in the many and often complex facets of banking, which would not be the case at the Postal Service.
The Postal Service has roughly $121 billion in unfunded liabilities worth 169 percent of its 2016 revenues, experienced a massive 2014 data breach affecting nearly 1 million customers, and was audited for having insufficient fraud controls. Entering the struggling enterprise into banking would place taxpayers at risk of having to subsidize or rescue it.
ICBA looks forward to working with Congress and the Trump administration on this issue.
The Independent Community Bankers of America®, the nation’s voice for nearly 5,700 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 ICBA’s website at www.icba.org.