St Casimirs Mortgage Minute

Keating: Banks of All Sizes Play Key Role in U.S. Economy


Banks of all sizes play a key role in supporting and growing the $16 trillion U.S. economy that is the envy of the world, ABA President and CEO Frank Keating said yesterday in an op-ed piece in The Hill newspaper, a publication widely read by policymakers.

"Thanks to community banks, which typically spearhead development efforts in their towns and make 46 percent of small loans to businesses and farms, Main Streets across the country are surviving and thriving," Keating wrote.

He explained that regional banks project the benefits of community banking onto a larger screen. "Their scale allows them to make bigger loans and help local businesses expand into new communities. They also account for 675 million jobs, $4 trillion in deposits and 43 percent of loans to individuals," Keating said.

He noted that the largest banks, which employ more than 1.2 million Americans, also do all of those things while filling a unique niche. "Their credit capacity and array of financial services support the operations of America’s globally active businesses, which in turn employ 20 percent of U.S. workers," Keating said. He added that large banks also created and operate the modern payments system, which keeps commerce turning.

"Banks of all sizes play a critical role in maintaining and growing the country’s economy, and this banking diversity should be supported by policy, not undermined by it," Keating said.

"That’s worth remembering the next time someone contemplates imposing crushing new compliance burdens on community banks, regulating regional banks as if they were global, or dismantling the nation’s largest banks."


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