Magazine article Independent Banker

Fine Points

Magazine article Independent Banker

Fine Points

Article excerpt

Giving Diligence Its Due

Sometimes it takes a while for a good idea to take hold. That's particularly true for cautious Washington, where the lumbering apparatus of big government grinds slowly on consensus and compromise.

The nation's capital is burgeoning with innovative ideas and good intentions. But it's an inherently deliberate, ponderous place. Washington's ethos is not boldness. Along the Potomac change takes time-and careful study defends against setting off chain reactions of unintended consequences.

About 11 years ago, ICBA, while promoting the idea of tiered regulation that proportionately matches an institution's scope and complexity, conceived of establishing simplified Community Reinvestment Act exams for community banks. Two years later, ICBA convinced the federal banking agencies of the concept's merits-allowing community banks to devote more productive resources to their customers and communities.

Since then, ICBA has steadily urged regulators to expand streamlined CRA exam access to community banks landing above the original $250 million-asset qualifying cap. We've suggested $1 billion or $2 billion, preferring the later figure. Through an ICBA/Grant Thornton study comparing the exam and compliance costs for "large" versus "small" community banks, ICBA demonstrated the unnecessary burden of the large bank exam.

With your help, ICBA is working diligently to achieve our long-sought goal to further lighten the CRA exam load for community banks-just one facet of our efforts in promoting regulatory relief. Encouragingly, policymakers have begun to see the light, and their most recent actions show it.

The OTS this month will allow all the community banks it supervises with $1 billion in assets or less - regardless of their holding company affiliation- to undergo streamlined CRA exam procedures. …

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