Good idea, needs updating.

The American Banker led a panel discussion of some of its members, allowing them to demonstrate once again their ignorance of their own situation. US Bankcorp CEO Richard Davis says that the big problem facing Geithner’s successor is “helping the industry handle international regulations”, lest they “overwhelm U.S. banks, or make them scale back their operations.” He isn’t saying what “operations” will have to be scaled back, probably because he doesn’t want to admit that 99.9% of us would be happy to see them scale back their money laundering, their overpriced derivatives, their fraudulent foreclosures and their participation in proprietary trading. But that is clearly the part of the business he intends to keep doing.

Davis also reiterated the frequent industry warning that regulation will make it too costly for banks to do business with many customers.

“Banking services will become less and less available to more and more people. And we’re not threatening, we’re not being mean, we’re not trying to make a point. But now you have credit risk and all those other risks” to worry about, he said. “That next scream you’ll hear from Congress a couple of years forward will be wondering where the banks are.”

So, those terrible international regulations will restrict lending to small business. Amazing how regulations directed at money-laundering, overpriced derivatives, thuggish proprietary trading and fraudulent foreclosures will result in reduced lending, the only thing most of us think is the business of banks. And of course all banks face the same rules, so Davis shouldn’t worry that US banks will lose out in international competition.

More whimpering:

James Rohr, the CEO of PNC Financial Services Group (PNC), said his first priority for a new Treasury Secretary would be eliminating economic uncertainty, including many businesses’ concerns over the fiscal cliff, health care reform and taxes. Such worries are keeping many bank customers, especially small businesses, from borrowing.

Only a banker completely insulated from the actual business community would say something this wrong. Let me help, Mr. Rohr: read this post by Paul Krugman titled Culture of Fraud and all the linked discussions and papers. I promise you it’s not too hard; even non-bankers like Krugman’s readers understand it quite clearly. You will feel much better about the future of lending when you get done.

We don’t want to forget the big problem facing banks, the fact that their reputation sucks.

“There are no allies for banks. There’s nobody speaking on behalf of banks,” Davis said during the panel. “We still have to build a reputation story.”

Really? No allies? How about those millions spent on politics? How about all that money for losers like Scott Brown and Mitt Romney? Didn’t you buy a bunch of allies? Oh well, I guess you’ll have to rely on all those senators and representatives of both parties who got millions and who get lobbied at the cost of millions more, and the Fed, the OCC, and the Treasury Department and all the rest of those allies you have cosseted and paid off for decades. Not to mention a Department of Justice that can’t find any criminals in your midst.

But those allies can’t fix your reputation when your industry is riddled with fraud and corruption, and when absolutely no single person can be found who is criminally liable for that fraud and corruption.

Davis has a great idea: you have to make your colossal bank more neighborly.

Davis said that banks wanting to repair their reputation should play up their similarities to smaller companies, with their generally tight-knit relationships in the communities where they work.

That’ll be interesting. Banks don’t pay interest, they arrange things to maximize their fees, and they don’t lend much to small businesses. They destroyed the financial futures of millions of people. And if we don’t change things to suit Davis, he’ll just stop serving local customers. That’ll show them.

I think these guys need to step up the threat level. They need to be competitive with Robert Murray of Murray Coal; the guy who blamed his mine collapse on an earthquake or Obama, I forget which, and who fired 156 workers because Obama won the election after he spent untold dollars to defeat him and other democrats.