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 September 14, 2005 #05-65
E-mail: [email protected]

ACB GIVES RECOMMENDATIONS TO CONGRESS
ON RESPONSES TO HURRICANE KATRINA

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ACB President and CEO Diane Casey-Landry today told members of the House Financial Services Subcommittee on Financial Services and Consumer Credit that community banks across the Gulf Coast are working together to get back up and running as quickly as possible to serve their customers.

Also speaking on behalf of the Community Bankers of Louisiana, Casey-Landry cautioned that CBL President Dan Digby warns that there is a perception gap between what is going on in the hurricane-affected areas and what regulators believe is happening.

Casey Landry added that Digby stated that community banks are not fully operational in the worst hit areas, and those that are operational are limited in the services they can offer.

“Liquidity remains a concern. The Federal Reserve must continue to provide the necessary liquidity to banks in the region as long as a cash economy continues to exist,” Casey-Landry declared.

“Community banks throughout the Gulf Coast are extremely concerned because many are cashing checks with limited identification. They fear that in 12 or 18 months, bank examiners will cite them for violating check-cashing rules during this crisis,” she explained.

Casey-Landry stated that those on the ground warn that this is a long-term problem, that many loans will have to be restructured and that regulators must be flexible and lenient in implementing regulations for many months to come.

“Community banks are actively reaching out to the victims and they are working together to do so. Banks in communities surrounding the most affected areas are sharing facilities, computers, and even personnel so customers of damaged community banks can be served,” Casey-Landry said.

“Perhaps the highest customer service priority is providing access to cash,” Casey-Landry said. “Community banks are waiving ATM fees, late fees, extending grace periods to customers in the affected areas, suspending mortgage payments for 60 or 90 days, developing alternative payment plans, and providing penalty-free CD withdrawals. And, they are working with small businesses to get them up and running,” she explained.

Casey-Landry thanked Chairman Bachus, Chairman Baker and Representative Hooley for their efforts on behalf of financial institutions in the area, and she offered the subcommittee a number of suggestions on how to assist bankers and their customers including:

The federal government must make absolutely clear that the U.S. banking system, and insured institutions, are safe and sound.
Congress must pass legislation to indemnify community banks in the Hurricane region for cashing bad checks.
Bank regulators must provide written guidance so that months from now bank examiners will not cite institutions for potential violations of the Bank Secrecy Act or the Patriot Act because they provided check-cashing services to victims under relaxed standards.
Regulatory policy must remain flexible over an extended period.
The SBA must offer a streamlined process to approve loans.

Casey-Landry concluded that, “Community bankers are eager to be engaged in the recovery process in innovative and creative ways. But actions praised today, must not be exposed to criticism tomorrow.”

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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ACB GIVES RECOMMENDATIONS TO CONGRESSON RESPONSES TO HURRICANE KATRINA

ACB GIVES RECOMMENDATIONS TO CONGRESS
ON RESPONSES TO HURRICANE KATRINA