Although last summer's financial reform bill was heralded by its supporters as a crackdown on the big banks, community bankers aren't convinced. Although some of the measures may help to level the playing field, like the non-bank resolution authority intended to end the too big to fail problem, other new rules will benefit the big banks even more. Those would include changes resulting in higher costs more easily absorbed by big banks due to their larger scale. The dislike of last summer's regulation package comes as a big surprise to Federal Deposit Insurance Coporation Chair Sheila Bair. Dave Clarke reports that she was taken aback by their snorts and groans about the new rules at an American Bankers Association event Wednesday. Here's some of the report:
Since the law was enacted, community banking groups have complained it will raise compliance costs even if larger banks are the specific targets. As prime examples they cite a crackdown on debit card fees and the new consumer bureau.
"The only thing these new regulations are doing for us is raising our costs," a Vermont banker told Bair.
Bair asked if the community bankers in the room wanted to repeal Dodd-Frank and give up the benefits targeted at them.
The question got huge cheers.
"I can't believe this. I really can't believe this," Bair said.
Read the full story at Reuters.