Our anonymous bank CEO writes on the latest news from the financial “reform” wars:
I have been trying to find some time to comment on President Obama’s banker bashing efforts. It started with his comments on 60 Minutes, “I did not run for office to be helping out a bunch of fat cat bankers on Wall Street.” (The I word again! I thought he won and is now President and should be governing for the best interests of all Americans, but I digress.) The bashing continued on Tuesday when he said the bankers should make an “extraordinary commitment” to help the economy. I now understand he will have another meeting with ‘community” bankers on Tuesday to continue his efforts.
All of this is about getting regulatory reform passed. H.R. 4173 and the Dodd bill are high on his agenda. President Obama is attacking on several fronts. He is using the media to maintain the populist view that bankers are greedy. With over 8,000 of us left, there are a few who fit that description, but the vast majority of us are very much like the owners of the small- and medium-sized businesses we serve. We couldn’t be more different than the stereotypical Wall Street banker. (For what it’s worth, there are no banks on Wall Street anymore!)
Besides attacking us as greedy, he is saying that we are not lending. Most of us are trying very hard to lend, which is how we make money. (Only a few of the very large banks are able to take to individuals and businesses in our area. Since the collateral that most businesses have is real estate, our ability to lend is limited. The regulators limit the amount of commercial real estate loans to no more than three times the bank’s capital. Most are there or above, so lending is limited and the administration knows it.
Lastly President Obama is driving a wedge between the large bank and the small banks and their associations. For most bankers our only voice in Washington is through our state and national associations. The administration and its surrogates (SEIU) have attacking the national associations and tried to pit one association against the other.
All this is an effort to take control of the financial industry. If you don’t believe me, read the transcript of an interview Bill Moyers had with the prime movers behind this effort, Heather Booth, Director of Americans for Financial Reform (see who is behind this group) and George Goehl, Executive Director of National People’s Action, both community organizers from Chicago. Both of them were at the White House when the financial reform bill was proposed. The control comes through the Consumer Financial Protection Agency and its director, appointed by the President, who can make rules about financial products and enforce those rules.
While I know it is fashionable to beat up on bankers like me, I cannot image that the American consumer is going to like the consequences of a Washington Czar dictating how many of their overdrafts the bank can pay or what the down payment is for their next mortgage. I am for fixing the problems that created the recession-Fannie Mae, government mandated lending for low and moderate income homeowners, unregulated mortgage brokers, unregulated off balance sheet activities, and too much risk, too much complexity, and too little capital by very large institutions. But this isn’t about fixing the problems, this is about control.
I can be contacted at BankerGuy2009@gmail.com.