Community Bankers Warn Against Reg Reform

The American Bankers Association is warning that passage of a financial services regulatory reform bill by the Senate would overburden community banks and threaten their future. In a letter to members of the Senate, ABA president and chief executive Ed Yingling says the reform bill would impose 27 new or expanded regulations on banks that would have a "dramatic negative impact" on community banks. The Independent Community Banks of America hopes the Senate will start debate on the regulatory reform bill this Thursday. ICBA wants some of the regulatory burden shifted to nonbank lenders, which potentially would include residential funders. "If there is no bill, all of that heavy burden will continue to fall on community banks and not fall on the nonbanks. That's the world we are living in now," said ICBA's top lobbyist Steve Verdier. Senate majority leader Harry Reid, D-Nev., needs 60 votes on Thursday to start the debate and amendment process on the regulatory reform bill but there are only 59 Democratic senators. Sen. Reid must get at least one Republic senator to cross the aisle. So far, Senate minority leader Mitch McConnell, R-Ky., has done a good job of keeping all 41 Republicans in line, one lobbyist said.