ACB: Press Releases

Contact:	Robert Schmermund (202) 857-3104 Jim Eberle (202) 857-3145	Jim Eberle (202) 857-3145 (work) (703) 893-2593 (home) [email protected]	For Immediate Release August 9, 2005 #05-56
E-mail: [email protected]

ACB SUGGESTS WAYS TO REDUCE BURDEN ON SMALLER COMMUNITY BANKS

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WASHINGTON, D.C. — America’s Community Bankers has offered the Securities and Exchange Commission a number of recommendations for reducing the burden of federal securities laws on smaller community banks.

David Bochnowski, chairman and CEO of NorthWest Indiana Bancorp in Munster, Ind., and a former ACB chairman, made the recommendations before a hearing of the SEC’s Advisory Committee on Smaller Public Companies in Chicago today.

Bochnowski recommended that the effective date for compliance by smaller companies with section 404 of the Sarbanes-Oxley Act be extended for an additional year. “It would be unfair to expose smaller companies to the significant burden and expense of 404 until all of the implementation issues are addressed,” Bochnowski told the Advisory Committee. Among those implementation issues are the Public Company Accounting Oversight Board’s examination of how auditors are approaching section 404 compliance.

Bochnowski said that due to the significant cost and burden of compliance, “serious consideration should be given to exempting smaller companies from the requirement. At a minimum,” he said, “we believe the SEC should follow the lead of the FDIC and exempt community banks and savings associations with less than $1 billion in assets.” These institutions “already operate under a microscope and investors would otherwise be protected by the complete application of all other safety and soundness regulations and periodic examinations,” Bochnowski explained.

Bochnowski also recommended that the SEC lengthen the filing deadlines for smaller companies to file certain reports and revise the definition of independence to broaden the pool of potential directors and audit committee members.

In a separate comment letter to the Advisory Committee, ACB provided more detail on these recommendations and also suggested that the capital threshold for accelerated filers be increased to $700 million; the independence rules be relaxed for auditors so that they can engage in more meaningful discussions with company management on accounting issues; and that smaller companies continue to be given appropriate transition rules for compliance with new accounting rules.

ACB also suggested that the SEC revise the registration requirements by increasing the number of shareholders that trigger registration and coverage under Sarbanes-Oxley.

Click here to read the testimony.

Click here to read the comment letter.

America’s Community Bankers is the national trade association committed to shaping the future of banking by being the innovative industry leader strengthening the competitive position of community banks. To learn more about ACB, visit www.AmericasCommunityBankers.com.

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