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Treasury Secretary Janet Yellen said her department is committed to ensuring the ongoing health and competitiveness of the community banking system, reflecting ICBA’s calls for policymakers to ensure deposit insurance policy does not pick winners and losers in the banking system.
Yellen Remarks: Speaking in Washington, Yellen said community banks provide vital credit and financial support to families and small businesses, increase competition in the banking sector, and often have specialized knowledge and expertise in the communities they invest in.
ICBA Response: In a national news release, ICBA President and CEO Rebeca Romero Rainey said Yellen’s remarks “recognize that if policymakers decide to provide unlimited deposit insurance to some institutions, they cannot leave others out—certainly not the community banks that have, as always, operated on a safe and sound basis.”
Previous Statements: ICBA last week denounced Yellen’s statements that uninsured deposits will be protected only at systemically risky financial institutions. In a statement, Romero Rainey said this policy “rewards mismanagement and risky behavior to the detriment of community banks and the communities they serve.”
Continued Media Coverage: Meanwhile, ICBA’s efforts to differentiate community banks from larger entities continued making headlines. Following ICBA’s op-ed in The Hill calling on policymakers to ensure any response to recent closures does not affect community banks, ICBA cited the community bank difference in The New York Times, Reuters, Fox Business, and other outlets.
Ongoing ICBA Efforts: ICBA will continue educating the public about the stability of the community banking industry while opposing any efforts to rope community banks into the policy response to recent bank closures.