Academic journal article ABA Banking Journal

Bankers Will Carry Red-Tape Warning to New Congress

Academic journal article ABA Banking Journal

Bankers Will Carry Red-Tape Warning to New Congress

Article excerpt

By most standards--except Uncle Sam's--10.7 billion is a lot of money. It's the amount ABA estimates that banks spent on government paperwork in 1991. That's nearly two out of three dollars the industry earned last year.

It's no wonder bankers are alarmed at the rising cost of red tape. And why nearly 1,000 of them participated in ABA's much-cited survey of the regulatory burden.

Make it real. But more meaningful, even, than the huge dollar figures that came out of the study have been the personal stories of bankers, who, fed up, are telling their stories to Congress and other influential officials.

Take Joe Scallorns, president, The Farmers and Traders Bank, California, Mo. He invited his congressman, Ike Skelton (D.-Mo.) to visit the bank. He showed Skelton firsthand what's involved in filling out government paperwork. And he told the representative that a reduction in compliance requirements would permit his bank to hire another loan officer, generating another $2 million in loans.

Government paperwork bites smaller banks hard. And as former ABA president, C.G. "Kelly" Holthus, president, First National Bank of York, Neb., told a group of ag economists recently, many smaller banks pay a higher percentage of their operating costs and profits on compliance than do large banks.

Holthus told the economists what bankers in Nebraska think about the red-tape hassle, especially the Community Reinvestment Act. He quoted one who said, "Hell, if we do not invest in our community, it dies and the bank dies with it. We do not need a law and paperwork to understand this. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.