The U.S. House of Representatives, the U.S. Senate and the White House have agreed on financial regulatory legislation. But bankers warn that the proposed law could force many small institutions to throw in the towel.
After an all-night session, lawmakers this morning came to an agreement on financial regulatory overhaul legislation.
One group that is “strongly opposed” to the proposed law is the American Bankers Association.
“This bill will, in the end, add well over a thousand pages of new regulations for even the smallest bank,” ABA President and Chief Executive Officer Edward L. Yingling said in a news release today. “As a result of this volume and the new restrictions, many small banks are telling us they will simply have to sell out to larger institutions that have the staff to deal with the massive volume of new reports and rules.”
Yingling noted that bankers support key reform principles including the creation of a systemic risk council. The trade group is also behind creating a system for handling the failure of large institutions and ending the concept of too-big-to-fail.
ABA would additionally like to see gaps in regulatory oversight closed and consumer protection enhanced.
“The consequences involved are very real and will have a very negative impact on traditional banks, on consumers and on the broader economy,” the ABA chief stated. “In the final analysis, the legislation in question simply does more harm than good and will make it exceedingly difficult for banks to be the drivers of economic growth and recovery going forward.”
