Banking advocates called for unity and said the industry message needs to be customer focused in order to make an impact on lawmakers.
“SDBA and other associations are increasingly couching the need for Dodd-Frank reform around the problems this bill is creating not just for banks but for our customers and for the communities that you are all trying to serve,” commented Curt Everson, president/CEO of the SDBA.
“I think it is time we let our customers carry that message,” said 2016-17 SDBA Chairman Paul Domke, Heartland State Bank, Redfield, S.D. “How we feel about the regulations and how they are affecting us doesn’t really matter. What matters to elected officials are the stories of our customers and our communities, and how they are affected. They don’t want to hear from whiny bankers; the heartstrings are pulled by customers telling those stories.”
ABA Chair Dorothy Savarese urged bankers to talk to elected officials. “Let your senators know we don’t want to pull back and repeal Dodd-Frank; we want to enable our banks to serve our customers and communities by doing common sense reforms that address over-reach.” Savarese is chairman, president and CEO of The Cape Cod Five Cents Savings Bank in Orleans, Mass.
“I sometimes wonder if legislators understand what we face every day,” said NDBA 2016-17 Chair Tom Stennes, Harwood State Bank, Harwood, N.D. “I remember when I used to feel that I helped someone every day, whether through a loan to help start a business or to buy a new vehicle. We used to go by our gut feel and it was good for the community we supported.
“Now I feel like all we do is make sure all the t’s are crossed and the i’s are dotted,” Stennes continued. “We have disruptors to our business coming from all sides, whether it’s fintech going after the payment systems or online lenders taking from our loans. None of these care about the local area. In my opinion, we have agencies trying to socialize the whole banking industry and change the business model of the industry.”
Savarese, Domke and Everson all stressed the need for industry unity.
“We wish to collaborate with the other banking and financial service organizations within our state and surrounding states,” Domke said, referring to the SDBA strategic plan. “We want to speak to our federal elected officials about several items. When we are fragmented as an industry it gives them an opportunity to say ‘no’.”
Everson referenced a recent directors’ college, which the SDBA co-sponsored with the Independent Community Bankers of South Dakota.
“If we are not on the same page, it is very easy for the legislators to just throw up their hands, or for them to go for something less than what we are asking for,” Savarese commented.
“The attitude of the Senate Democrats is to position themselves as being against most changes to fundamental elements of Dodd-Frank. To the extent they might consider changes, in areas such as rural home mortgages, they only want to change the rules for banks under $10 billion in assets,” Everson said during comments at the SDBA annual meeting luncheon. “My fundamental question is whose interests are they trying to serve by taking that position? Ironically, the answer does not appear to be the interests of the consumers.”
Everson cited the example of a bill designed to increase access to affordable qualified mortgages for entrepreneurs and farmers. “That bill is fundamentally sound but it only extends QM status to those types of loans if they are made by a bank with less than $10 billion in assets,” Everson said. Any change that would expand the availability of qualified mortgages should apply to all customers, regardless of the size of the bank they use, Everson argued.
He cited the example of Great Western Bank. “They are sitting at about $11 billion in assets,” Everson said. “They are the only bank right now in this state that is serving the South Dakota communities of Colman, Crooks, McIntosh, Morristown and Rosholt. These towns all have fewer than 500 people. But my contention is, shouldn’t their customers living in those communities have the same access to a qualified mortgage as a customer living close by where there is a bank with less than $10 billion in assets operating? This should be a pro consumer bill; the size of the institutions shouldn’t matter.”