The president of the Iowa Bankers Association says the financial reform bill that just passed the Senate misses the mark. I.B.A. president, John Sorensen, says the law is loaded down with provisions will “greatly undermine” the ability of traditional banks to help provide credit and create jobs in communities.
“Many of these negative provisions have frankly nothing to do with the financial crisis, you know despite all the talk about this being a Wall Street bill, in fact it does tremendous harm to traditional banks on main street that had nothing to do with the financial crisis, and are now in a position where they need to support a recovering economy,” Sorensen says. Sorensen says there are some 30 new regulations the banks will have to follow.
Sorenson says they did support the need to regulate “large systematically important institutions and non-bank loan originators to better protect consumers and taxpayers.” But he says the problem with the way that is done, is that it creates a new federal consumer protection agency.
Sorensen says the law was well intended, but in the end it will increase the cost of credit and services to bank customers while not getting to the crux of the problem that created the financial crisis. Sorensen says the I.B.A. hopes some of the “more onerous provisions” will be addressed when the bill goes to the conference committee that works out differences in the House and Senate bills.