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NEW JERSEY BANKERS APPLAUD REGULATORY RELIEF BILL

 NEW JERSEY BANKERS APPLAUD REGULATORY RELIEF BILL
 PRINCETON, N.J., June 26 /PRNewswire/ -- The New Jersey Bankers


Association today hailed the announcement by the Bush administration that it has sent to Congress a bill to ease the strain of federal regulations on the nation's banks.
 The administration effort is a comprehensive package that seeks to trim the stack of paperwork that hinders lending by the nation's banks.
 "We worked closely with the American Bankers Association in Washington to identify excessive regulations which could be eliminated with no risk to consumers," said Alfred H. Griffith, president-elect of the New Jersey Bankers Association. "We're very pleased that the White House package includes nearly all of our recommendations."
 Of primary interest to the NJBA are provisions in the bill which cut down on duplicative supervisory exams; reduce new and substantial auditing costs; minimize government intrusion in day-to-day bank operations; lessen burdensome appraisal requirements; and ease the paperwork requirements of the Community Reinvestment Act for small banks.
 "We are all mindful of the need for strong bank regulation," observed Griffith. "But, when our members find themselves providing the same, detailed information every day on 10 separate forms, you start to wonder if there's a better way."
 Griffith praised the provisions in the bill that may lead to fewer examinations, with federal regulators relying on state regulators' examinations instead of conducting their own.
 "The examination of all banks in one year by numerous, overlapping regulatory bodies is absolute overkill," said Griffith.
 "It interrupts the important daily activities of banks and their officers, particularly when there is no evidence to suggest that state regulators are not just as vigilant as federal regulators."
 As for auditing costs, the bill seeks to eliminate a provision of the Federal Deposit Insurance Corporation Improvement Act of 1991 (FDICIA) to require that accounting firms certify compliance with safety and soundness regulations.
 "Given the substantial taxpayer cost to pay depositors for the savings and loan bailout, we can understand why Congress wants to show a 'get tough' approach, but they have absolutely gone too far over recent years, and particularly with FDICIA," noted Griffith. "What they are doing is inhibiting banks from fulfilling their economic purpose by adding substantially to the cost of doing business, instead of having those funds available for loans. Congress should stop passing new laws increasing bank costs and take some time to evaluate and eliminate many of the counterproductive ones they have enacted over the past several years."
 "The paperwork burden for banks is particularly staggering, especially for our smaller banks which aren't large enough to justify hiring compliance specialists," he added.
 A recent ABA survey found that banks spent more than $10.7 billion last year -- or 59 percent of industry profits -- simply trying to keep pace with industry regulations.
 "This is the first time anyone has quantified the cost of the paperwork burden and its impact on the economy," Griffith said. "If 25 percent of that cost could be applied to bank capital, the industry could support between $20 billion and $30 billion in additional loans nationwide."
 "NJBA plans to pinpoint a number of particularly significant regulations that could realistically be eliminated to allow banks to lend more, but it appears the administration's bill is a significant step in the right direction," Griffith concluded.
 /delval/
 -0- 6/26/92
 /CONTACT: Kurt E. Schaub of the New Jersey Bankers Association, 609-924-5550/ CO: New Jersey Bankers Association ST: New Jersey IN: FIN SU:


MJ-LJ -- PH011 -- 4235 06/26/92 13:01 EDT
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Publication:PR Newswire
Date:Jun 26, 1992
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