In remarks on the Senate floory, Senator Bob Corker joined a number of colleagues to urge passage of the Economic Growth, Regulatory Relief, and Consumer Protection Act (S.2155). The bipartisan legislation, authored by Chairman Mike Crapo (R-Idaho) and cosponsored by Senator Corker, is targeted toward helping community banks, credit unions, mid-sized banks, regional banks and custody banks. The bill also includes important consumer protections, particularly for veterans, senior citizens and victims of fraud.
Here are excerpts of the senator’s remarks:.
“I was here when Dodd-Frank was passed. I was on the banking committee at that time. I didn't support it, and the reason I didn't support it is for the many things that we’re doing today to correct it.
“And whenever regulation passes, it begins at the targeted group – which was the larger institutions in our country, which failed – but then over time, the regulatory processes seep down to the smaller entities, the smaller banks that are enhoused in the communities all across our respective states. [These are] the members of the Rotary Club, the Kiwanis Club, the Lions Club, the Chamber of Commerce, the people who make things happen in our communities back home.
“And so we’ve ended up in a situation now where our community banks and credit unions that serve our communities, that cause economic growth to occur, now have these large back-office operations that are spread over a smaller asset base.
“[It] has made them noncompetitive and has made it very difficult for them to do the jobs that we all cherish that they do back home, which is help to grow those economies. And so this bill is focused on them.”
“But what we’re doing here is giving relief to those institutions, and it’s about time. We've had enough time to see what needs to happen.
“This was done in a bipartisan way, which I’m thankful of. And Senator Crapo… I would just like to thank you for your leadership here and working with people on both sides of the aisle to create a responsible bill that’s not an overreach.
“What we’re doing is taking a very constructive step to make sure that these smaller institutions, which represent a very small amount of the assets in our nation but have such outsized impact on the communities that they are in, have the ability again to flourish and do the things that are necessary for our economies back home to grow.
“So, I thank you. I’m proud to be a part of this and a cosponsor. I thank you for letting us be a part of it, and I hope that collectively we will ensure this is a very successful effort. Thank you.”
U.S. Senator David Perdue urged support for the financial regulatory reform legislation.
Senator Perdue said, "My hometown bank has been bought and sold a few times. My father who was a school superintendent was on that board. It was my first exposure to how banking works. I remember going with my dad, who didn't make a lot of money, when he wanted a loan to buy a car. I remember sitting off to the side and listening to the conversation. I knew the lending officer because he taught me in Sunday school. We saw him every week in church and his children went to the school where my dad was principal. This is a different time today. I understand that. The facts still remain that relationship lending should be at the core of what we consider here. This is a lending institution making a transaction with an individual who will then pay that loan back.
“Since Dodd-Frank became law, about 1,700 banks have shut down. Most of these are community banks and regional banks, entities that had nothing to do with the financial situation in 2008. Some in this body may see that as an encouraging sign that big government is now getting more control of the lending principal and the banking industry, I think they're misguided.
“Local banks, credit unions, and regional banks, are the banks supporting our local main street, providing small businesses with capital, and sponsoring little league baseball games. For nearly eight years, small-town banks have been hammered by big government regulations enacted by Dodd-Frank.
“Compliance costs for community banks have risen by more than four or five percent. I met with a regional bank from Georgia. Their compliance costs have gone up because of Dodd-Frank. That's money that could be in the community in the form of loans. Instead, it's now in the form of higher compliance costs and fines paid to the federal government.
“We address government restrictions on reciprocal deposits in this bill. Reciprocal deposits have created uncertainty around the critical lifeline for community banks and especially minority-owned banks that have specialized in serving customers with limited discretionary access to capital. Dodd-Frank has crippled these banks when it comes to serving their communities.
“In my state, Citizens Trust Bank, a minority-owned bank in Atlanta, has been forced to drawback it's business because of the regulatory imposed by Dodd-Frank. This is counter intuitive. Thanks to the action we're taking this week, Citizens Trust will be able to grow their business because of safe harbor provisions. They are not alone. Carver State Bank, a minority-owned bank serving Savannah, Georgia, for 90 years, will also benefit.
“Small banks often spend too much time and resources dealing with the regulations and compliance costs that Dodd-Frank has created. Put simply, Dodd-Frank is another one-size-fits-all, Washington, bureaucratic policy that hurts the very people it claims to champion, the middle class, working poor, and those communities that have the least access to capital. Fortunately, we have an opportunity to do something today to fix these problems.
"This bill has 12 Democratic cosponsors and I applaud them for the courage it's taken to work with us to get a bill where both sides give and take. People back home want both sides in the Senate to work together to get things done. Here's a shining example. If we can get it across the finish line, this will have a dramatic impact on main street back home.”