Kustoff Discusses the Need for New Financial Institutions
Washington, D.C. - In a Financial Institutions and Consumer Credit Subcommittee hearing today, U.S. Representative David Kustoff (TN-08) discussed the impact that the Dodd-Frank Act has had on the creation of new or “de novo” financial institutions. Below is the Congressman’s full opening statement.
“I’d like to thank the Chairman and Ranking Member for holding this hearing today to discuss the importance of de novo financial institutions to the banking industry. And, I do want to thank the witnesses for joining us in this discussion.
“Over the last six years, we have seen a dramatic decline of de novo charter applications.
“In fact, there have been five new bank and 16 new credit union charters issued since 2010.
“If you compare that to the eight years prior to the implementation of Dodd-Frank, the numbers are staggering, because during that time we say over 1,200 bank applications and 75 credit union charters issued in those eight years prior to Dodd-Frank.
“I am looking forward today to hearing from you all your experiences.
“If I can, just for the record –I want to read a quote from a banker that I have in Gibson County, which is in rural West Tennessee.
“He said, “Dodd Frank has had a direct cost to our community bank of at least $100,000 per year, not including additional salaries and benefits for support people to monitor and make sure we are in compliance. Another $25,000 has been spent on making sure our auditors are keeping us in compliance. Dodd-Frank has taken away much of the essence of allowing us to serve our communities.”
Kustoff represents the 8th District of Tennessee and is a member of the House Financial Services Committee, serving on three subcommittees: Financial Institutions and Consumer Credit, Oversight and Investigations and Terrorism and Illicit Finance.