A recent tweet by democratic Sen. Mark Warner, a supporter of the Senate regulatory relief bill, S. 2155, that passed March 14, is worth sharing. He wrote: “Virginia only lost one community bank during the financial crisis. We’ve lost 21 since Dodd-Frank passed. Regulations should keep Wall Street in check, not run small community banks out of business.” That prompted me to find the same numbers for Louisiana banks. Which are: one bank failed during the financial crisis, and 38 bank charters have gone away sine Dodd-Frank’s enactment in 2010. Since Dodd-Frank passed there have been only seven new bank charters nationwide. As of the third quarter of 2017, Louisiana had 127 domiciled banks. Another 10 are domiciled in another state and have locations here. It is unclear now what the U.S. House of Representatives will do with S. 2155. Whatever they do, it must not overreach to the point it loses the democratic support necessary in the Senate.
The loss of community banks that has taken place in Louisiana and Virginia is representative of what is occurring nationwide. This trend began well before Dodd-Frank, and that law has certainly accelerated the trend. All bankers need to help blunt the aggressive nature of federal banking agencies and Congress to continually impose greater demands on community bankers. We must not let our congressional delegation believe that the relief contained in S. 2155 is the end of banking’s need for relief. We need to communicate it is the beginning. See the article by Joe in this newsletter for more details on the bill’s provisions. This year’s LBA Washington Visit is July 10-12. We are working to have meetings with key people, including Acting Director of Consumer Financial Protection Bureau Mick Mulvaney. Be present to finally hear from federal bank regulators some encouraging developments and to voice your need for more.