Blaine Luetkemeyer: “I thank Chairman Hensarling for the time. To say that the current regulatory climate presents challenges for small…”

“I thank Chairman Hensarling for the time. To say that the current regulatory climate presents challenges for small financial institutions would be a drastic understatement. Today, regulators require more and more from community banks in terms of both regulatory oversight and capital requirements. The gentlewoman from Utah has crafted legislation that seeks to alleviate some of these pressures facing our community banks. Small bank and thrift holding companies confront unique challenges with regard to capital formation, which is a particular concern at times when regulators demand more and more capital. Understanding these challenges, the Fed has recognized that small banks have limited access to equity financing. The Federal Reserve small bank holding policy statement gives relief from certain capital guidelines and requirements, making it easier for a community bank to raise capital and issue debt, and to make acquisitions and form new bank and thrift holding companies. I would like to digress for just a little second here. I haven't heard anybody talk about it, and I think it is very important, Mr. Speaker, that we talk about the timeframe prior to 2008, whenever we were averaging about 150 to 175 new banks and credit unions every year. But between the timeframe of 2010 and 2006, we averaged one. That is significant because small businesses get their loans from small banks.…”