Community Bankers Meet With Obama as Regulation Fight Heats Up

December 26, 2009

With tighter financial regulations looming in the near future, community bankers met up with President Barack Obama to state their concerns. The President took the opportunity to push his stance on bankers increasing lending to small businesses. Voicing his concern on the current situation he said “The pendulum may have swung too far in the direction of not lending”. However, on the complaint made by the bankers of “too much red tape which makes lending difficult”, Obama said that the White House was working on solving the issue. He did add that no intervention would be made on federal regulators who are often perceived by banks as being very strict. “We don’t have direct influence over our independent regulators” said The President.

The lack of unity in the banking community is a leading cause in the production of an unsatisfactory bill in Washington. The American Bankers Association (ABA) and the Independent Community Bankers of America (ICBA) are at loggerheads. Both claim to represent the community banks and each claims an impressive member list. The 134 year-old ABA claims that its members represent “95% of the total assets within the banking system” and the slightly younger ICBA, created in 1930, claims to have more than 5,000 dues-paying banks within its ranks.

The row between the two groups is looks set to deliver only one thing for certain – an unsatisfactory bill for the banking industry, a train of thought echoed by ABA Chairman Art Johnson when he said”(this) will invite the enactment of a bill that will truly hurt us badly for years to come”.