The Independent Community Bankers of America (ICBA) addressed Congress in regard to the proposed Consumer Financial Protection Agency (CFPA), urging them to set the agency’s sights on the unregulated firms that hold systematic risk.
The ICBA has been very vocal over the past year as Congress looks to reform the banking sector and how it is regulated. The association is worried that many of the proposed changes put a further burden on their business as they compete with the major national banks.
The ICBA member banks have capital leverage and liquidity ratios that are on average above industry requirements and much better than the nation’s top ten banks. While too-big-to-fail firms have cost taxpayers about $7 trillion, community banks have not been a burden the economy through the financial crisis.
Menzies is concerned with the current draft of the CFPA, stating it would create an autonomous director and an advisory board with no real authority.
Additionally, the ICBA is urging Congress to forgo its expedited dates on the Credit CARD Act for Community Banks.
Congress is moving to push mandates from the CARD Act to be met by December 1, 2009, up from the originally dates of February and August of 2010.
“The recently enacted Credit CARD Act and its effective dates are already placing substantial burdens on the 74 percent of community banks that offer credit card programs as they change systems, train employees and implement procedures to comply with the new rules,” the ICBA said in a statement.
The ICBA is arguing that the nation’s more than 8,000 community banks are responsible lenders that offer credit cards on fair terms and are not guilty of the practices that the CARD Act seeks to prevent.
