Congresswoman Martha Roby

Representing the 2nd District of Alabama

Roby: Hometown Lenders “Paying the Price” for 2009 Financial Crisis

June 8, 2017
Press Release

WASHINGTON, D.C. – U.S. Representative Martha Roby (R-Ala.) today spoke in favor of legislation that would level the playing field for community banks and credit unions and the small businesses and farmers who depend on them.

Roby spoke on the House floor and urged her colleagues to support H.R. 10, the Financial CHOICE Act, which seeks to untangle much of the regulatory web put in place by the 2010 financial overhaul known as Dodd-Frank. 357 financial institutions – including four community banks in Alabama – have been forced out of business because they could not keep up with Dodd-Frank’s compliance costs, Roby said.

“Homegrown banks can’t keep up with the crazy compliance costs that Dodd-Frank mandates,” Roby said. “Here’s an example: At one credit union in Alabama’s Wiregrass region, their compliance department has tripled in size. They estimate that these new costs have limited their growth by as much as 60 million dollars. That’s not right. Hometown lenders in Alabama didn’t cause the financial crisis of 2009, but now they and their customers are paying the price.”

The House is scheduled to vote on H.R. 10 today. More information on the bill from the House Financial Services Committee is available here.

The full text of Rep. Roby’s remarks as prepared is below:

M. Speaker, since the enactment of Dodd-Frank in 2010, a total of 357 financial institutions have been forced out of business.

Four community banks in Alabama are on that list.

That amounts to nearly seven and a half billion fewer dollars in Alabama’s economy that could be lent to help small businesses and farmers. In all, nearly 20 percent of Alabama’s community banks have either closed or been forced to merge under Dodd-Frank.

Why is this happening? Because homegrown banks can’t keep up with the crazy compliance costs that Dodd-Frank mandates.

Here’s an example: At one credit union in Alabama’s Wiregrass region, their compliance department has tripled in size. They estimate that these new costs have limited their growth by as much as 60 million dollars.

That’s not right. Hometown lenders in Alabama didn’t cause the financial crisis of 2009, but now they and their customers are paying the price.

There’s no question we need strong laws to govern our financial markets, but Dodd-Frank isn’t the answer.

We now have a chance to fix this broken law, untangle this regulatory web, and unleash the capital investment that is so crucial to economic growth.

I urge my colleagues to support the CHOICE Act.

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