Regulatory Review Meeting Focuses on Rural Bank Burdens

Rural banks face a number of challenges that are compounded by unnecessary, outdated and excessively burdensome regulations, Comptroller of the Currency Thomas Curry said today at the fourth of five outreach meetings for the decennial Economic Growth and Regulatory Paperwork Reduction Act review. The often small banks serving rural customers have faced “some serious challenges this year,” he explained, citing challenging economic conditions, rapidly changing technology and tax-advantaged competition from the Farm Credit System.

Curry also emphasized the danger of cumulative rulemakings for rural banks. “What worries me is the way that the regulatory rulebook builds up over time, adding layer after layer of requirements that can be quite onerous for small banks,” he remarked, repeating his call for Congress to pass several regulatory relief bills.

Also speaking at the meeting was FDIC Vice Chairman Thomas Hoenig, who discussed the importance of tailoring regulation to a bank’s activities, not its asset size. “U.S. banks engaged in core banking activities and operating with reasonable levels of capital should not incur the same regulatory burden as those that do not,” Hoenig said. As part of its Agenda for America’s Hometown Banks, ABA has strongly advocated for tailored regulation based on a bank’s size, business model, risk profile and other differentiating characteristics.