The Devil is in the Details

Congress is working to wrap up the financial regulatory reform bill in the next few weeks. 

Community bankers know better than anyone how important it is to make sure that we get the details right so that the final bill isn’t bedeviled by contradictions, overregulation and unintended consequences. 

There are critical sections in both the House and Senate versions that must be resolved in conference if we are to have genuinely meaningful reform.

Specifically, ICBA is focused on these legislative priorities (among others):

• Treating trust-preferred securities as Tier 1 capital,
• Halting any changes to the current interchange system,
• Expanding the community bank exemptions to the Consumer Financial Protection Bureau,
• Preserving the ability of states to establish lending limits for state-chartered community banks,
• Allowing new federal thrift charters,
• Permitting the CFPB to regulate payday lenders and other nonbank financial firms,
• Clarifying the definition of swap dealers in derivatives trading.

ICBA has a good chance of prevailing on these issues. ICBA has already won significant concessions for community banks in the legislation that many thought were impossible –increasing the FDIC assessment base to level the playing field and save community banks $4.5 billion over three years; preserving the Federal Reserve's authority to examine state-chartered community banks and small bank holding companies; and exempting safe residential mortgage loans from the 5-percent risk-retention requirement. So don’t bet against us.

The end-game is to enact a good, balanced regulatory reform bill that fixes what broke while not hurting the community banking industry. To do that we need your help. Contact your representatives  – we have made it easy for you to take action; please do take action today.  

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