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BANKER ANNOUNCES STEP TWO OF RED TAPE REDUCTION EFFORT

 PRINCETON, N.J., Feb. 26 /PRNewswire/ -- The chairman of the New Jersey Bankers Association recently announced his group's plan to travel to Washington next week to encourage the state's congressional delegation to get behind legislation that would "insert balance in the regulatory framework," increase the availability of credit and provide a much needed jolt to the nation's economy.
 Speaking on Wednesday evening before more than 100 members of the North Jersey Chapter of the Robert Morris Associates, NJBA Chairman Robert G. Cox, president of Summit Trust Company, Summit, outlined how bank lending has spurred recovery from prior recessions, as well as the modifications needed in recently enacted laws to enable similar growth today.
 "During the last five recessions, increases in bank loans averaged 8 percent during the first year of the recession, and 9 percent after 2 years," said Cox. "Following this recession, bank loans grew only 0.4 percent during the first year, and actually declined 0.6 percent after two years."
 "Typically, banks play a major role in expansions," he added. "The negative growth of bank lending in this recovery is rather dramatic evidence that something is constraining the growth of bank credit."
 The NJBA chairman pinned much of the blame for these results on congressional overreaction to the savings and loan crisis whereby legislation was enacted in an attempt eliminate lending risks at all kinds of financial institutions.
 Cox announced that more than 30 of New Jersey's leading bankers would travel to Washington next Wednesday and Thursday to meet with the state's delegation and seek their co-sponsorship of bills in both houses of Congress that would restore regulatory balance, reduce paperwork and, correspondingly, increase the pool of credit available to potential borrowers, namely individuals and small to mid-sized businesses.
 "Passage of these bills, S-265 and H.R.-962, will go a long way toward reducing the excessive cost of our current paperwork burden without compromising safety and soundness provisions," said Cox. "This would free up valuable resources, both monetary and human, that can be focused on the business of lending."
 "The time has come for borrowers and organizations interested in lending to come forward as the U.S. Chamber of Commerce, the National Home Builders Association and the New Jersey Society of Certified Public Accountants have and support regulatory burden relief for America's prime source of business and consumer financing," he added.
 The first phase of NJBA's effort was to encourage the six leading national banking trade organizations to unite on the issue of regulatory relief. That push resulted in a letter being sent in December to then President-elect Clinton seeking his support, and signed by the heads of the American Bankers Association, Independent Bankers Association of America, Association of Reserve City Bankers, Association of Bank Holding Companies, Consumer Bankers Association and the Savings and Community Bankers Association of America.
 The NJBA's efforts are being guided by its Task Force on Regulatory Reform, chaired by its treasurer, John G. Collins, vice chairman, UJB Financial Corp., Princeton.
 /delval/
 -0- 2/26/93
 /CONTACT: Kurt E. Schaub, director of communications of the NJBA, 609-924-5550/


CO: New Jersey Bankers Association ST: New Jersey IN: FIN SU:

CC-JS -- PH027 -- 0998 02/26/93 16:40 EST
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Date:Feb 26, 1993
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