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FDIC Vice Chairman John M. Reich Recommends Legislative Changes to Reduce Regulatory Burden
FDIC Vice Chairman John M. Reich testified before the Senate Banking Committee today and outlined proposals to revise several statutes governing the banking industry. While strongly reiterating his personal view that regulatory burden has a disproportionate impact on community banks, Reich said, “Banks, large and small, labor under the cumulative impact of regulations that divert resources and capital away from economic development, credit extension and job creation.”
Reich is leading an interagency initiative, required by the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA), to review all federal bank and thrift regulations in an effort to eliminate any regulatory requirements that are outdated, unnecessary or unduly burdensome. An Interagency Task Force, which includes representatives from the FDIC, Federal Reserve System, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision, has sponsored several banker outreach events across the country to gain insight into issues that are considered burdensome to the industry. The Task Force also has considered feedback received during meetings with consumer and community groups, as well as comments submitted in response to public notices relative to the EGRPRA project.
Reich outlined numerous legislative proposals that are under discussion, including suggestions for:
Vice Chairman Reich told the committee that “these are just some of the ideas I am pursuing on an inter-agency basis to reduce unnecessary burdens on the banking industry, without jeopardizing safety and soundness considerations or diluting important consumer protections.
The testimony can be found at www.fdic.gov/news/news/speeches/archives/2004/sp22june04.html on the FDIC’s Web site.
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Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation's banking system. The FDIC insures deposits at the nation's 9,116 banks and savings associations and it promotes the safety and soundness of these institutions by identifying, monitoring and addressing risks to which they are exposed. The FDIC receives no federal tax dollars – insured financial institutions fund its operations.
FDIC press releases and other information are available on the Internet via the World Wide Web at www.fdic.gov and may also be obtained through the FDIC's Public Information Center (877-275-3342 or (703) 562-2200).
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