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 February 6, 2001 #01-11
E-mail: [email protected]

AMERICA’S COMMUNITY BANKERS STRONGLY URGES OTS TO WITHDRAW ‘FATALLY FLAWED’ HOLDING COMPANY PRIOR APPROVAL PROPOSAL

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WASHINGTON, D.C. — America’s Community Bankers has strongly opposed the Office of Thrift Supervision’s proposal to impose prior approval requirements on certain savings and loan holding company transactions. “ACB believes this proposal is fatally flawed and must be withdrawn,” said Diane M. Casey, president & CEO of the national trade group.

ACB also expressed “serious reservations” about the potential for the proposed regulation to ultimately impose minimum capital standards on all thrift holding companies. ACB’s views were expressed in a comment letter to OTS.

“This rule introduces an unnecessary and overly burdensome regulation for hundreds of well-capitalized and well-managed savings and loan holding companies that is without sound regulatory justification,” said Casey. “At best, the proposed rule introduces a previously unknown, and practically unworkable, prior notice regulatory scheme; at worst, it represents an unjustified substitution of the appropriate business judgment of qualified holding company management with that of the OTS,” she added.

“Nothing in this proposal adds measurably to improving safety and soundness and at the same time it jeopardizes the very existence of a corporate structure that has proven valuable over the years,” Casey said. “ACB strongly opposes this imposition of additional regulations governing transactions by holding companies.

“Furthermore, ACB does not support any OTS proposal that would result in the establishment of defined holding company capital standards that would place savings and loan holding companies at a competitive disadvantage in the marketplace,” Casey added.

ACB acknowledged that OTS has legitimate concerns about actions by holding companies that could put their savings association subsidiaries at risk. “However, we believe that OTS’s record of regulating savings associations demonstrates quite effectively that the agency already possesses the requisite supervisory tools to prevent such rare occurrences within a narrow universe of holding companies requiring heightened scrutiny.

“It is partly because of the presence of such regulatory resources that ACB finds the proposed regulation so troublesome,” said Casey. “If adopted in its current form, savings and loan holding companies will be hamstrung by this regulation and will operate at a significant competitive disadvantage. This will, in turn, pose a serious risk to the long-term viability and attractiveness of a federal savings association charter.”

Casey said that ACB’s working group would work with OTS to determine how best to respond to the agency’s supervisory concerns after the proposal is withdrawn.

ACB’s Comment Letter is ATTACHED.

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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