Banker Op-Ed: Over-Regulation Limits New Bank Startups

Excessive regulation is keeping people from starting new banks, A. Scott Anderson said in a Deseret News op-ed published today. Anderson is president and CEO of Zions Bank, Salt Lake City. “From my experience, onerous federal regulations are playing a large role in destroying incentives to engage in the banking business,” he wrote.

Anderson cited recent news coverage of the fact that only one de novo bank has opened since the Dodd-Frank Act was passed (with one more having received conditional approval). He also quoted ABA Community Bankers Council member Tyrone Fenderson’s recent testimony before the House Financial Services Committee on the challenges bankers face meeting their customers’ needs in today’s regulatory environment.

“Over-regulation often reduces bank flexibility to meet the unique circumstances of customers,” Anderson wrote. “Common sense is replaced by complex rules. Fear of violating regulations and potential lawsuits leads to fewer loans, hurting customers and their communities.”