I have owned
and operated a small bank in Southern Minnesota for over 30 years and am
quite concerned about Regulatory burden and the increase of the burden
that is not related to banking. The issues are either to solve social
issues or chase bad guys for other agencies. All of which is unfunded
mandates. Yet at the same time there are more charters, branches, and
non-banks entities eating away at our profit margins.
Just
yesterday I received a ICBM flyer in conjunction with FDIC on a BSA
seminar, the agenda included issues on Money Laundering and Terrorist,
other issues on BSA, OFAC, the Patriot act, SAR's, and on and on. The
banking industry has mostly honest people, but the failure to comply or
accidentally miss a report or make a small honest error on any of these
the regulatory penalty is very severe. There is no balance.
We cannot
make rules or laws for every little error or injured customer somewhere in
the world. Although I do see problems, just yesterday a customer dropped
off a brochure about Countrywide having a 3.99% HELOC and was wondering
why our rate was so high? Ah! after reading the "small" print their
special rate was for a whole 30 days and required minimum usage. At our
last examination our bank was criticized for having "Overdraft Charge" on
a brochure and "OD Charge" on the customers bank statement. Our
computer technology still has space limitation that occasionally require
abbreviations, but a written criticism!!!
Overall my
biggest vent is and continues to be the enormous amount of paperwork
generated to service others, a mortgage loan closing has so many copies
and requirements fro both state and federal issues that it is beyond the
customer comprehension to read. Then we report it 8 ways from Sunday,
sliced and diced in call reports, HMDA reports, real estate reports, IRS
reports, to generate work for some analyst to crunch numbers that means
very little to anybody other than the analyst. All of this watchdog
checking and rechecking to file reports for other agencies is a burden on
the capital and earnings of a banking industry. We spend as much time with
these issues as we do trying to run a bank, make money, and service our
communities and customers.
As soon as
possible the Patriot Act, HMDA, and BSA should be put on the shelf and/or
eliminated among others.
