Florida Banking September 2023

STRAIGHT TALK FROM THE PRESIDENT’S DESK

BATTLING LEGISLATION THAT CREATES MORE GOVERNMENT INTERFERENCE

BY ALEJANDRO “ALEX” SANCHEZ, FBA PRESIDENT AND CHIEF EXECUTIVE OFFICER

T he politics of this era are getting wackier by the moment. The banking industry is being attacked and challenged by legislation that creates an unlevel playing field and more government interference in our free enterprise system. These proposals benefit trending financial interests that are the flavor of the month for some legislators and regulators. Many of these bills, by the way, are being filed by Republicans. I wish Ronald Reagan were here today; he would be opposed to all of this. Recently, a Republican Senator from North Dakota

decide for themselves whom to bank. The decision to serve an industry or business is based on the bank’s business and risk profile. Some banks are skilled in banking certain industries and not others. What these politicians are worried about is bankers playing political games with industries due to social issues. I think our industry has gotten that memo, and we understand. As I have mentioned to you many times, including in an op-ed that was published nationally, I advise our industry not to dance with the political right or left. Banks should stay out of social issues. If

has filed bill S.293, the Fair Access to Lending Act, which places significant restrictions on certain banks, credit unions and payment card networks if they refuse to do business with a person who complies with the law. Restrictions include prohibiting the use of electronic funds transfer systems and lending programs, termination of an institution’s depository insurance and specified civil penalties. Banks and other financial institutions are allowed to deny financial services to a person only if the denial is justified by a documented

we fall for the trap of listening to a limited number of voices, it will hurt our industry and the free enterprise system. What any bank or company will discover if they look hard enough is that they have employees, investors and directors with diverse political and social beliefs, some who are on the right and others who are on the left. My message is to stay out of it. In addition to this Senate bill, Republican House Financial Services Chairman Patrick McHenry (R-NC) and his committee have a bill on stablecoin legislation.

“THE BANKING INDUSTRY IS BEING ATTACKED AND CHALLENGED BY LEGISLATION THAT CREATES AN UNLEVEL PLAYING FIELD AND MORE GOVERNMENT INTERFERENCE IN OUR FREE ENTERPRISE SYSTEM.”

failure of that person to meet quantitative, impartial, risk-based standards established in advance by the institution. This justification may not be based upon reputation risks to the institution. The sponsor of S.293, Sen. Kevin Cramer, is a Republican and conservative who normally sides with the idea of less government interference in the free enterprise system. Our message to Sen. Cramer and to all members of Congress is this: bankers should

Chairman McHenry is proposing putting the regulation of this unstable industry in the hands of state regulators. Chairman McHenry, have you attended a state legislative session lately? Our state legislators are funding roads, schools and prisons well before increasing regulatory funding. That is why state bank examiners often move to federal agencies where they can double or triple their salaries. By placing the regulatory structure of the stablecoin industry with

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