Over the past few years, there have been more than 5,000 pages of new regulations introduced—and more are in some stage of finalization, without taking into account supervisory guidance, Financial Institution Letters, blog posts or enforcement actions that have the effect of creating policy.
The impact is hindering the ability of community banks to meet the needs of their small business customers and consumers, who are the collateral damage of such harmful overreach.
To address excessive regulations harming local communities, we are requesting repeal, reissuance, and/or revisions of the following rules, regulations and rhetoric:
Consumer Protection
Section 1071
CRA
Fair Lending/Redlining
Section 1033
NSF
Overdraft
Representment
All other “junk fee” rhetoric
UDAAP guidance
Reg E opt-in circular
Medical debt
Fair Credit reporting
EWA & BNPL
Larger participant rule
Housing
GSE Reform
FHLB Mission Reform
Prudential
Brokered deposits
Custodial accounts
Corporate governance proposal
ILC Charter Applications
Bank Merger Policy
Innovation
Bank-fintech supervisory environment
BSA/AML
Corporate Transparency Act (31 U.S.C. 5336)
Customer Due Diligence Rule (31 CFR § 1010.230)
Payments
Credit card late fee
Reg II
Master Account access
Personnel
Overtime Rule (DOL)
Non-Compete Rule (FTC)
Community banks play a vital role in driving the U.S. economy by providing critical banking services and credit access to consumers, small businesses, and farmers across America. Unfortunately, current policies have created an uneven playing field that prioritizes the too-big-to fail megabanks over local community banks.
Additionally, the path for community banks to establish new charters, raise capital, expand into new markets, or develop new partnerships has been anything but straightforward or certain.
A strong U.S. economy depends on strong community banks, and we are seeking to strengthen the ability of community banks to support local communities through the following:
Eliminate obstacles to de novo bank formation
Support tax policy that is conducive to leveling the playing field and supporting market growth and competition
Revisit current deposit insurance and resolution requirements so that community bank customers have the same protections as the largest players in the market
Supporting the community bank charter itself is essential to maintaining the backbone of local economies and ensuring financial access for underserved communities.
Unfortunately, community banks face mounting challenges from regulatory agencies structured to serve larger, complex institutions and from external threats such as the rapid rise of nonbank financial institutions and growth-obsessed credit unions that are not subject to the same regulatory oversight and that erode the competitive landscape.
To ensure community banks are able to serve their local communities for years to come, ICBA is seeking to bolster the community bank charter through the following:
Addressing the structural deficiencies in the agencies, including the lack of official community bank representation on federal agencies such as the FDIC, the CFPB, Treasury, and the FFIEC, among others.
Reevaluating the shortcomings of legislatively prescribed processes for bank failures and receivership by which winner and losers are picked without regard to community impact.
Developing thoughtful incentives and education to eliminate the barriers community banks face in succession planning and by way of misguided corporate governance requirements of supervisory agencies.
Preventing the erosion of the financial system and disintermediation of banking services that are the result of novel charters and tax exempt credit unions.
Supporting and strengthening the payments system and preserving the community bank position as primary payments provider while addressing fraud risk and liability.
Ensuring an even playing field that limits government sponsored entities unfair advantage in rural America and other communities across the country.
