Washington, D.C. (July 10, 2023)—Independent Community Bankers of America (ICBA) President and CEO Rebeca Romero Rainey issued the following statement on Federal Reserve Vice Chair for Supervision Michael Barr’s remarks on pending regulatory capital rules.
“ICBA and the nation’s community banks commend Vice Chair Barr for affirming that pending regulatory capital standards will target the largest and riskiest financial institutions, and we caution regulators to ensure new capital standards have no trickle-down effect on institutions below $100 billion in assets, including community banks. Speaking today in Washington, Barr said new capital and debt requirements should apply to banks and bank holding companies with $100 billion or more in assets.
“Barr’s remarks reflect previous statements from Federal Reserve Chairman Jerome Powell, Federal Deposit Insurance Corp. Chairman Martin Gruenberg, and Fed Governor Michelle Bowman that new regulatory capital standards should not affect community banks.
“As demonstrated by the recent failures of large, risky banks, including Silicon Valley Bank and Signature Bank of New York, community banks are different and operate under a vastly different model than these large financial institutions, and any regulatory reforms designed to rein in large bank risk should not be applied to community banks. Policymakers should ensure that any changes to the capital framework are tailored to appropriately distinguish large banks that pose systemic risk to the financial system from the thousands of community banks that serve local consumers and small businesses.
“ICBA will continue working with policymakers to ensure Washington’s policy response does not affect the community banks that continue to appropriately manage risk and do right by their customers and communities.”
The Independent Community Bankers of America® creates and promotes an environment where community banks flourish. ICBA 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.
With nearly 50,000 locations nationwide, community banks constitute roughly 99 percent of all banks, employ nearly 700,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding nearly $5.9 trillion in assets, over $4.9 trillion in deposits, and more than $3.5 trillion in loans to consumers, small businesses and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities throughout America. For more information, visit ICBA’s website at www.icba.org.