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.