A Do-Something Washington

by Rob Nichols, American Bankers Association

Partisanship in Washington in recent years has led some to believe that Congress doesn’t “do” collaboration anymore. One party’s gain is seen as the other’s loss, making deals hard to come by.

But many bankers who came to Washington in March for ABA’s Government Relations Summit and other meetings got a slightly different vibe from the policymakers they met with. Yes, some members of Congress predictably held firm against significant changes to the Dodd-Frank Act. Yet others, informed – and perhaps worn down – by bankers’ true stories of how over-the-top rules were harming their customers were positive about the possibility of finally doing something for community banks.

There’s a similar realistic yet optimistic attitude behind an effort by the two leaders of the Senate Banking Committee – Chairman Mike Crapo (R-Idaho) and Ranking Member Sherrod Brown (D-Ohio) – to identify legislative changes that could help spur economic growth. They won’t pursue changes they don’t believe in, of course, but both see an opportunity to find and pursue common ground.

These encouraging signs are made all the more hopeful by administration officials who have proactively reached out to community banks to learn what rules are acting as roadblocks to growth. In March, President Trump invited nine community bankers to the White House for a roundtable discussion of the industry’s regulatory challenges.

Though the bankers represented institutions with different business models, operated in different parts of the country and were affiliated with different national trade associations (six were part of ABA’s delegation; three were with the Independent Community Bankers of America), there was remarkable alignment in our policy positions and priorities.

The same can be said for the follow-up meeting that Treasury Secretary Steven Mnuchin held with 16 community bankers in April. That’s where the secretary made clear how serious the administration was about helping banks perform their critical role in promoting economic growth. And it’s where we dug into the specifics of issues related to mortgage, agricultural and commercial lending, as well as Consumer Financial Protection Bureau rules that are ill-tailored for community banks. There again, ABA and ICBA members were side-by-side, advocating practical solutions.

Such alignment is critical to success in Washington. I’ve said before that Washington has enough challenges without trying to legislate issues on which an industry is divided. Policymakers up and down Pennsylvania Avenue are interested in addressing our problems – so long as we can agree on the best solutions.

And I am confident that the solutions we have proposed – as detailed in white papers ABA shared with Secretary Mnuchin following the meeting – are what’s right for America’s banks and the communities they serve. The white papers (which can be found at www.aba.com/executive-orders) articulate how regulation in areas like capital, liquidity, fair lending and stress testing can be improved. They were informed by the deliberations in recent years of bankers who serve on our many councils and working groups and who represent banks of different business models and asset sizes. Solutions born of such diverse perspectives are always stronger by ensuring that they make sense for all banks.

Given how intent this administration is about using banks to spur growth, and given the interest Congress has shown in providing some community bank regulatory relief, having strong solutions with unified industry backing could just make something happen in Washington again.

The bankers representing ABA at the White House meeting were ABA Chairman Dorothy Savarese, chairman, president and CEO of Cape Cod Five Cents Savings Bank, Orleans, Mass.; Chairman-Elect Ken Burgess, chairman of FirstCapital Bank of Texas, Midland, Texas; Vice Chairman Jeff Szyperski, chairman, president and CEO of Chesapeake Bank, Kilmarnock, Va.; Leslie Andersen, president and CEO of Bank of Bennington, Bennington, Neb.; Luanne Cundiff, president and CEO of First State Bank, St. Charles, Mo.; and Laurie Stewart, president and CEO of Sound Community Bank, Seattle.

The bankers representing ICBA were ICBA Chairman Rebeca Romero Rainey, chairman and CEO of Centinel Bank, Taos, N.M.; ICBA Chairman-Elect Scott Heitkamp, president and CEO of ValueBank Texas, Corpus Christi, Texas; and ICBA Vice Chairman Tim Zimmerman, president and CEO of Standard Bank, Monroeville, Pa.

The bankers representing ABA at the Treasury meeting were ABA Chairman Dorothy Savarese, chairman, president and CEO of Cape Cod Five Cents Savings Bank, Orleans, Mass.; Chairman-Elect Ken Burgess, chairman of FirstCapital Bank of Texas, Midland, Texas; Treasurer George Hermann, president and CEO of Windsor Federal Savings, Windsor, Conn.; Government Relations Council Chairman Stan Jenks, president and CEO of Security Savings Bank, Monmouth, Ill.; Leslie Andersen, president and CEO of Bank of Bennington, Bennington, Neb.; Stacey Bentley, president and CEO of Community Bank and Trust, Waterloo, Iowa; Shan Hanes, president and CEO of First National Bank of Elkhart, Elkhart, Kan.; Patti Husic, president and CEO of Centric Bank, Harrisburg, Pa.; and Bill Wagner, chairman, president and CEO of Northwest Bancshares, Warren, Pa.

Representing ICBA at the Treasury meeting were Jeff Dick of MainStreet Bank, Fairfax, Va.; Steve Handke of Union State Bank, Everest, Kan.; Jack Hartings of Peoples Bank Co., Coldwater, Ohio; Ronald Paul of EagleBank, Bethesda, Md.; Mark Schroeder of German American Bancorp, Jasper, Ind.; Sam Vallandingham of First State Bank, Barboursville, W.Va.; and Noah Wilcox of Grand Rapids State Bank, Grand Rapids, Minn.