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 June 1, 2001 #01-42
E-mail: [email protected]

ACB URGES BANKING REGULATORS TO REVISE PROPOSED NEW BASEL CAPITAL ACCORD

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WASHINGTON, D.C. — America’s Community Bankers urged the federal banking regulators and the Basel Committee on Banking Supervision today to revise and seek additional comment on the proposed new Basel Capital Accord because it disadvantages domestic banks versus their global, internationally active counterparts.

ACB said the plan could subject domestic U.S. banks to capital requirements that would be higher than those for global institutions with risker portfolios. “While the accord states that the goal is not to change capital levels overall, in fact ACB believes that many community banks will end up holding higher capital under the accord as compared with global and potentially more risky institutions,” ACB said in its comment letter.

ACB explained that many community banks will be competitively disadvantaged further still by having to use the “standardized” approach to determine minimum capital standards because they lack the resources of global banks to develop a finely tuned “internal ratings-based” approach.

“Fundamentally, ACB believes that the accord offers far too few benefits for community-based financial institutions in the United States,” the trade group said. At the same, it would impose a “disproportionately burdensome and overly complex system of capital regulation on community banks.”

The comment letter is available by fax or HERE.

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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