Senate Bill 2155 is a good first step toward making changes to Dodd-Frank. There are a lot of good things going on right now. I think two banks have gone over $50 billion since Dodd-Frank was passed. We’re never going to get to $250 billion in our lifetime, but the question is, if we are not going to be at that next level of supervision, what does that mean in terms of how view our activities? Is it going to change the regulatory lens, how they look at us, or do they continue to do what they’re doing now?ĭINELLO: Moving the designation above $50 billion is significant. WILLINGHAM: It’s the biggest issue in the bill for us. The regulatory relief bill doesn’t touch the $10 billion threshold but would raise the SIFI threshold from $50 billion to $250 billion. That $10 billion, it’s a number - you have to look at the risk of the organization, how much capital they have - but yet it is a bright line. If you are over $10 billion, they are not deductible. If you are under $10 billion, FDIC premiums are deductible. We are continuing to spend huge amounts of energy around stress testing.īRENT BEARDALL: One of my biggest questions is why the $10 billion arbitrary threshold? So many things have latched on to that. The size of our risk organization is 10 times what it was 10 years ago. We were half this size 10 years ago and the level of change we’ve had to go through has been remarkable. We have been regulated as a bigger bank than we are. That’s starting to ease a little bit, but we can’t take it for granted.ĮDWARD WILLINGHAM: We want to see what happens with the Senate bill we hope that it moves through. We have to be our own advocates go up to and talk to about what’s important to midsize banks.ĭINELLO: Operating with flexibility - we’ve been stifled by regulations for a long time.

You look at the rest of the landscape, and you’ve got so many that are below $10 billion, then you’ve got these behemoths that are bigger than $100 billion and we just get less attention. A midsize bank is really going to be in a different place. How are you feeling about where you are at, sizewise?ĪLESSANDRO DINELLO: I don’t think anything has really changed that much.

You have a lot of the same compliance costs as the big banks but don’t have the same efficiencies, and there was a sense that midsize banks might be going away. It’s been a couple of years since we sat down with senior leaders from midsize banks, and the big concern then was that you were feeling a little bit squeezed. What follows is an edited transcript of the discussion. Some are deeply concerned about their ability to attract and retain talent and they had mixed opinions on how recent tax cut signed into law by President Trump late last year will affect customers’ borrowing decisions. Regulatory relief was the dominant theme of the discussion, but it was not all that was on bankers’ minds. Brent Beardall, the president and CEO at the $15.6 billion-asset Washington Federal in Seattle and Richard Ehst, the president and chief operating officer at the $10.8 billion-asset Customers Bancorp in Wyomissing, Pa. The others were: Alessandro DiNello, the president and CEO at the $17.7 billion-asset Flagstar Bank in Troy, Mich. Willingham was one of four bankers present at the roundtable, which was hosted by the American Bankers Association and was designed to provide insight into the issues and opportunities facing midsize banks. Banks spend a significant amount of time, money and energy preparing for these annual examinations and eliminating them could go a long way toward easing their regulatory burden. The big benefit for banks in between these two groups - those with $10 billion to $50 billion of assets - is that they would no longer be subject to mandatory Dodd-Frank Act stress tests. The bill, if passed, would relieve banks with less than $10 billion of assets of a number of requirements around mortgage lending, capital management and data collection and ease regulatory scrutiny of regional banks by lifting the threshold for which they are deemed “systemically important financial institutions,” or SIFIs, from $50 billion to $250 billion.

Most of the analysis of the regulatory relief bill that passed the Senate earlier this year has focused on how it will help small and regional banks, but the measure - which could face a House vote as early as next week - also contains provisions that could provide significant benefits to midsize banks.

Sizewise talent