Two weeks from today, a delegation of about 60 bankers from Indiana will be heading back home after spending a couple of whirlwind days in Washington, DC, for the 2015 IBA Annual Washington Trip. Early fall is an ideal time for the Washington visit, because Congress is amid the wind-down of the fiscal year, which ends Sept. 30, and gearing into finishing up the calendar year. This is when things happen in DC! It is both an exciting time and a scary time for our trip. This year could be the most pivotal year for us since the beginning of the financial crisis in 2008. Why?
Republicans and Democrats have been in agreement that banks, particularly community banks, need regulatory relief. As an industry, we have done a pretty good job of conveying how the current level of regulatory overreach has stymied bankers’ ability to serve customers and help communities grow, which in turn boosts the overall economy. Although Democrats and Republicans largely agree that something needs to be done, they do not agree on exactly what or how ‒ and that may be a problem for bankers. With fewer than 50 session days remaining this year, the list of priority legislation is lengthy. As of this writing, instead of dealing with budget items before the end of September, Congress instead will probably pass a continuing resolution (CR) to fund government at existing levels until near year-end.
That means that Congress will likely be dealing with various budget items throughout the remainder of the calendar year. In addition, Congress will have to deal with increasing the federal debt limit, reauthorization for transportation, dealing with the much-publicized Iran nuclear treaty, renewing tax extenders and reauthorizing the Federal Aviation Act. Also, the debate regarding the renewal of the Export-Import Bank charter seems far from over. All of these issues come ahead of any possibility of bank regulatory relief, I fear, particularly because there does not appear to be a deal that Democrats and Republicans agree on.
Currently the issue for bankers is centered in the Senate. Democrat Sen. Joe Donnelly from Indiana, a member of the Senate Committee on Banking, Housing & Urban Affairs, is at the epicenter of this debate. We certainly appreciate his willingness to insert himself into this fray, and we have been pleased with his efforts on behalf of the industry. We simply hope that he and his counterparts can come to consensus in time to get on the limited 2015 calendar. If he is successful in the Senate, Indiana could play a pivotal role in the House of Representatives, as well. Republican Congressmen Marlin Stutzman and Luke Messer both sit on the House Financial Services Committee. Both are supportive of regulatory relief for banks and are willing to help ignite efforts to get bills passed to accomplish that end.
Underlying all of these scheduling and timing issues are the worldwide economic concerns. Those concerns will reach a crescendo on Sept. 17 and 18, when the Federal Reserve Open Market Committee determines whether or not to raise interest rates at this time. The world will be watching, and stock markets will be responding. If a rate increase occurs, it will be for only one-fourth of a percent, but would be the first increase in nearly 10 years, signaling a directional change in economic management by the Federal Reserve, which the markets may or may not like.
Consequently the IBA trip to Washington, DC, could not come at a more opportune time. There is still time to join us, if you have not already registered, to help us speak in unison and potentially influence, for the better, how bankers fare in 2015!
– S. Joe DeHaven