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President Obama and ICBA Chairman Announce Small
Business Lending Initiatives at White House Press Conference
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ICBA leaders joined President Obama and Treasury Secretary
Geithner in person at a White House press conference to help introduce
up to $15 billion in new small business lending initiatives and
government loan guarantees for Main Street America. The ICBA-advocated
funding initiatives, include support for the Term Asset-Backed
Securities Loan Facility program the association advocated for, are
aimed at unfreezing lending in the secondary markets for Small Business
Administration loans that community banks use most effectively.
Standing with President Obama and Secretary Geithner on
the event's podium, ICBA Chairman Cynthia Blankenship praised the
administration's initiatives as a big boost to help finance the
operations, expansions and formations of Main Street businesses throughout
the country. "All community bankers will be encouraged about the
opportunities the new program will afford to leverage credit lending
dollars and give the small businesses an affordable way to finance
future growth," Blankenship said. "This is an incredible tool
for community banks nationwide to help jump-start the economy and
credit markets."
The Obama administration's ICBA-backed lending
initiatives, to take effect by the end of the month, include up to $15
billion in funding for SBA program government-guarantees and reduced
fees. Upfront fees of up to 3.75 percent and some processing charges on
certain SBA loans will be eliminated. Government guarantees on certain
SBA loans will increase from 85 percent to 90 percent for loans below
$150,000 and 75 percent for larger loans.
Representing the nation's community banks, ICBA was the
only banking association to participate in and offer remarks during the
East Room press conference. ICBA President and CEO Cam Fine and ICBA
leader David Schroeder, president and CEO of American Enterprise Bank
in Buffalo Grove, Ill., also participated in a roundtable discussion on
the initiatives with Blankenship before press conference.
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ICBA Speaks Out Against Ag Budget Cuts
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ICBA expressed opposition to the more than $16 billion in
cuts to the farm safety net proposed in President Obama's fiscal year
2010 budget. In a joint letter signed by
nearly 40 farm and lender organizations to the chairmen and ranking
members of the House and Senate Agriculture and Budget Committees, ICBA
and other signers noted the cuts are being proposed just eight months
after enactment of the 2008 Farm Bill, which, at the time, contained
more than $7.6 billion in cuts to the safety net.
"Most troubling, far from targeting large agribusinesses that do
not need assistance, the proposed cuts would strike at the economic
heart of full-time farm families," the letter says.
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ICBA Urges Changes to
Mark-to-Market, OTTI Standards
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ICBA urged policymakers to reform accounting standards
that are exacerbating the current financial crisis. At the House
Financial Services subcommittee hearing, ICBA recommended several
changes to existing standards and urged additional guidance on other-than-temporary
impairments of debt securities to improve financial reporting. ICBA was
the only banking industry trade association testifying. "With all
the economic crises facing this country right now, the application of
these rigid accounting rules, in these times, is much like throwing
gasoline on a raging inferno," said Thomas Bailey, president and
CEO of Brentwood Bank in Bethel Park, Pa., and chairman of the
Pennsylvania Association of Community Bankers.
ICBA recommended several changes to existing standards and urged
additional guidance on OTTI of debt securities to improve financial
reporting and urged Congress to encourage the SEC and FASB to apply
existing accounting rules for loans held in portfolio to debt
securities financial institutions are able and willing to hold.
Bailey said current mark-to-market accounting rules hinder transparency
and distort the true condition of financial institutions holding debt
securities, which negatively affects credit. He urged Congress to
encourage the SEC and Financial Accounting Standards Board to apply
existing accounting rules for loans held in portfolio to debt
securities financial institutions are able to hold.
ICBA has been the leader in raising concerns about mark-to-market
accounting and will continue to work with Congress, FASB and the SEC to
ensure that problems are addressed and community banks can keep credit
flowing. Read ICBA Release.
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ICBA Financial Crisis Survey Results Online
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Results from an ICBA and Aite Group joint survey of community
banks are online. The survey found 55 percent of community banks have
seen an increase in deposits through gaining new customers. In
addition, community banks are acquiring new customers at a faster rate
than in the past. Read ICBA Release.
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