ACB: Press Releases

Contact:	Robert Schmermund (202) 857-3104 Jim Eberle (202) 857-3145	Jim Eberle (202) 857-3145 (work) (703) 893-2593 (home) [email protected]	For Immediate Release April 25, 2002 #02-25
E-mail: [email protected]

ACB SUPPORTS MANY PROVISIONS OF REGULATORY RELIEF BILL, RECOMMENDS ADDITIONS, OPPOSES CREDIT UNION EXPANSION

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WASHINGTON, D.C. — America’s Community Bankers said today that it supports many of the provisions of a regulatory relief bill introduced in the House, recommending additional provisions and deletion of items that would promote the expansion of credit unions.

Testifying at a hearing of the House Financial Institutions Subcommittee, ACB Chairman Curtis L. Hage said: “By eliminating unnecessary and costly regulations, these provisions will make it easier for financial institutions to better serve our customers and communities.”

Hage, who is also chairman and CEO, Home Federal Bank, Sioux Falls, S.D., listed the following priority issues strongly supported by ACB:

The bill’s language removing unnecessary restrictions on branching by national and state banks and repealing intrastate branch capital requirements. ACB recommended adding a provision eliminating unnecessary paperwork for well-capitalized banks seeking to open new branches.
A provision that would provide parity with banks for savings associations by exempting them from licensing and registration requirements of the Investment Advisors Act of 1940 and the Securities Exchange Act of 1934 when offering trust and fiduciary services.
The addition of several provisions to improve the ability of savings associations to engage in business and real estate lending in their communities.
The first amendment would raise the lending limit on commercial loans to 25 percent of assets. Currently, the limit is 20 percent, with a requirement that any excess over 10 percent must be in small business loans. The small business basket would be eliminated. The second would eliminate the $500,000 per unit cap on residential development loans to a single borrower. The third would increase the overall limit on commercial loans to 500 percent of capital, from the current 400 percent, with authority for the Office of Thrift Supervision to further increase the limit. None of these provisions would change qualified thrift lender requirements.
An expansion of reimbursement to financial institutions for producing records for law enforcement agencies, especially since additional records will be produced under the new anti-terrorism legislation, the USA Patriot Act. Currently, government reimbursement is made only for the production of records of individuals and small partnerships. ACB said reimbursement should be expanded to cover corporate and other organization records.

ACB also supported:

Giving federal savings associations the same authority as national banks and state member banks to make community development investments.
Replacing a statutory requirement capping the evaluation of purchased mortgage servicing rights at 90 percent with authorization for the banking regulators to increase the cap to between 90 percent and 100 percent.
Giving OTS the discretion to waive the requirement that subsidiaries of savings and loan holding companies give OTS 30-days’ notice of dividend payments (ACB recommended completely exempting well-capitalized institutions).
Adding to the bill authority for unitary thrift holding companies converting to multiple holding company status 10 years to divest nonconforming activities, up from the current two years.
Providing that, for purposes of jurisdiction in federal courts, a federal savings association is deemed to be a citizen of the state in which it has its home office.

ACB strongly opposed several provisions benefiting credit unions: allowing privately insured credit unions to join the Federal Home Loan Bank System; increasing the maturity limit on loans made by federal credit unions; allowing credit unions to increase check cashing services for non-members; and eliminating numerical membership limitations in voluntary mergers and conversions into multiple common bond credit unions.

America’s Community Bankers is the national trade association committed to shaping the future of banking by being the innovative industry leader strengthening the competitive position of community banks. To learn more about ACB, visit www.AmericasCommunityBankers.com.

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