Nichols calls on banks to work together on current challenges

ABA President and CEO Rob Nichols today called for unity in the banking industry as bankers confront present challenges. In his opening address at the ABA Annual Convention in Nashville, Nichols noted that “we are strongest and most effective in our advocacy when we are able to come together. That’s how we will achieve a policy environment that will support economic growth—not restrict it—so that bankers like you can continue doing the most important job you have: serving your customers.”

Among the challenges that are top-of-mind for the association are the so-called “Basel III endgame” proposals to increase the amount of capital banks are required to hold in reserve. “There is a cost to too much capital, and it’s paid by both consumers and businesses who need credit, and ultimately, this proposal puts economic growth at risk,” Nichols said. “It would be a self-inflicted wound at a time when our economy is already feeling the effects of high interest rates—and it doesn’t make sense.”

Nichols also recapped ABA’s current litigation against the CFPB, emphasizing that the association will continue to push back against attempts by regulatory agencies that exceed their authority. ABA has challenged the bureau over a 2022 update to its examination manual that would have greatly expanded its ability to examine banks for alleged discriminatory conduct, and over its 1071 final rule relating to small business data collection.

“We don’t like suing regulators. We want to have productive working relationships with all of the banking agencies, and we will continue to work constructively with the CFPB where we can,” Nichols said. “But we will not allow blatant regulatory overreach to go unchecked. Should the bureau—or any other agency—issue another rule that clearly exceeds the statutory limits set by Congress, they can count on seeing us in court.”