I could say a lot about this subject, all from a semi-informed point of view. What I would like to express is that smaller banks used to play a very beneficial role in the building of neighborhoods in our cities. We have almost completely lost this and I don't think that is a good thing.
I sent this message through the ABA's web site to my congressman and Ohio's senators.
Senator Brown
Senator Voinovich
Message text follows:
Robert Klass
(personal)
Mentor, OH
August 26, 2009
[recipient address was inserted here]
Dear [recipient name was inserted here],
As a constituent, I am writing to express my strong opposition to the
Administration's proposal to eliminate the federal thrift charter.
On the contrary, we should encourage the creation and maintenance of
community banks.
When I was a VP at an S+L in the 1980's I saw how regulators were
responsible for as many problems as they may have prevented. Had we
listened to them, we would have created variable interest rate loans which
would have been unaffordable and possibly unmarketable.
Our company became strong by lending in our area and making sound
underwriting decisions. Underwriting guidelines should be rolled back to
what they were "in the day" - 1980 style. 28% of income for housing, 36%
total debt ratio, etc.
Don't screw up this industry further. Turn back the clock and recognize
the benefits of smaller thrift institutions.
Sincerely,
Bob Klass
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