Newspaper article THE JOURNAL RECORD

Lack of Branch Banking Law Led to Bank Failures / in Many Cases, Says Osborn

Newspaper article THE JOURNAL RECORD

Lack of Branch Banking Law Led to Bank Failures / in Many Cases, Says Osborn

Article excerpt

There would have been fewer bank closings in Oklahoma if laws to allow branch banking had been in place sooner, according to Wayne Osborn, acting Oklahoma bank commissioner.

Osborn also said there will be more bank failures through 1987 but by early next year the number of failures will begin to slow down because of recent signs of a turn around in the state's economy. There have been 26 bank failures in Oklahoma so far in 1987 and 64 since July 1982.

Gov. Henry Bellmon announced Tuesday he has filed the necessary paperwork to appoint Osborn officially to the banking commissioner post, for a term which ends Jan. 1, 1990.

The appointment requires approval of the five-member Oklahoma Banking Commission and confirmation by the Oklahoma Senate.

Osborn has been the acting bank commissioner since July 1, the date when Robery Y. Empie, former commissioner, agreed to step down from that post.

In a controversial move last March, Bellmon accused Empie of using insider information to sell his stock in United Oklahoma Bank in Oklahoma City and removed him from office. However, the attorney general's office could find no evidence of wrongdoing by Empie and the Bellmon order was removed. Empie then announced he would resign from the department.

Osborn discussed the banking commission, Empie's work as bank commissioner and the causes for Oklahoma's 64 bank failures beginning with Penn Square Bank on July 2, 1982, at a press conference Tuesday when Bellmon made the announcement of the appointment.

The state's economic slump over the past few years has been the primary reason for the number of bank failures, Osborn said. Though poor management practices has played a part in some failures, Osborn said that wasn't always the case because oftentimes a bank which had been declared insolvent had the same management for over 20 years.

Asked if there would have been fewer bank failures in recent years if Oklahoma had established laws allowing branch banking sooner, Osborn said:

"Yes, I think branch banking would have made a significant difference. …

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