Academic journal article ABA Banking Journal

ABA: Making the Case for Traditional Banking

Academic journal article ABA Banking Journal

ABA: Making the Case for Traditional Banking

Article excerpt

AS CONGRESS MOVES FORWARD ON banking issues, ABA is continuing our promotion of the key elements of traditional banking so we can help our members maintain the trust of their customers and communities.

ABA represents banks of all sizes and charters because we are one industry, and whether we like it or not, our fortunes rise and fall together. Division invites our opponents to exploit an inability to speak with one voice. With that in mind, we are urging your support for the policy priorities for 2010 that your ABA Board of Directors has adopted.

Let me give you an overview of these issues:

The proposed Consumer Financial Protection Agency would have an enormous impact on our industry. It will affect our profitability, our regulatory burden, and our ability to serve our customers and communities. We continue to be very concerned about the administration's proposal because of its unworkable conflicts with a bank's prudential regulator, its new powers, and the lack of focus on the shadow banking system. Yet we agree with Chairman Dodd and Ranking Member Shelby of the Senate Banking Committee that consumer protection needs to be strengthened, and have been working with them on their proposal.

In another area, we also want to end the concept of "too big to fail" because, as our Board document declares, "it is expensive to the economy and to the government."

ABA is also supporting strong capital standards that will sustain the risk profile of financial institutions, both banks and non-banks.

Our Action Priorities for 2010 include an effective, efficient, and flexible financial regulatory structure and charter choice, dual banking and business flexibility. …

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