Increased bank regulations, following the criticism of the Federal Deposit Insurance Corporation's oversight prior to the financial crisis, have brought complaints from many small-town banks, saying they will have to add staff to comply with the new laws and may be forced to merge with larger banks. Now one bank is saying the new rules are putting it out of business.
Main Street Bank in Kingwood, Tex., frustrated by what it calls government micro-management, plans to "surrender its banking charter and sell its four branches to a nearby bank," Robin Sidel of The Wall Street Journal reports. "The regulatory environment makes it very difficult to do what we do," bank Chairman Thomas Depping told Sidel.
In July 2010, the bank was subject to a 25-page order from the FDIC that accused it of "putting too many eggs in one basket" and required the bank "to increase its capital cushion" and "shore up its lending guidelines," among other things, Sidel reports.
Main Street Bank announced it will sell its four branches, all deposits and some loans to Green Bank, a unit of Houston-based Green Bankcorp Inc., with the remaining loans going to a new firm created by Depping, backed by private investors, that will lend money but not be regulated or insured by the FDIC. (Read more)
Just more ducking of regulatory oversight by capitalists more determined to profit at society's expense than they are to improving society, funding and provisioning jobs or contributing to the communithy.
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