Community Banks on the Agenda

Congressman Lynn Westmoreland held a hearing in Newnan, GA, yesterday regarding regulators' treatment of community banks, and it got alot of attention - see the Newnan Times-Herald, the Atlanta Journal-Constitution, the New York Times, and the Associated Press).  He hits the nail on the head:

"[W]hat we are seeing is that banks that are ‘too big to fail’ are given assistance to survive, while community banks are pushed to the side and have become ‘too small to save.’"

"Some of these purchasing banks don’t know the community...  What they know is that the quicker they flush out troubled assets – even those that are performing – they better off they are.  So now we have communities that don’t have community banks.  Generational wealth has been sucked out of communities and capital has dried up.  Had some of these federal regulators thought to themselves, ‘I’ve been in Washington for 30 years and have never actually worked in a bank.  I should be talking to these local leaders and bankers to determine what would be the best way to help them out.’  Instead, they ignored problems and enforced policies, like loss-share agreements and immediate write-down of loans, that only caused more trouble for community banks.  Without these community banks – who know and understand and are invested in their community because it is their own – economic recovery has stalled and we see investment in smaller areas all but disappear."

Let's continue to support Westmoreland as a key voice for community banks in Washington.