October 24, 2016
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Bankers Association Speaks Out On Waters Issue

 WASHINGTON -- Over the past several weeks, the National Bankers Association ("NBA") has received a number of media inquiries regarding the House Ethics committee's charges against CongresswomanMaxine Waters.

The National Bankers Association's position remains clear in its support of Congresswoman Waters and is appreciative of her efforts to strengthen and preserve not only minority owned banks but, most importantly, the communities they serve.  

NBA's Historical Relationship to Congresswoman Maxine Waters

For nearly a decade prior to 2008, Congresswoman Waters had championed the cause of the NBA.  She attended NBA meetings and has passionately advocated for the need to preserve and strengthen minority banks, which is by law a responsibility of the regulatory authorities.  Though she has fought for economic inclusion for many other minority business organizations, the NBA is grateful for the access afforded it as a result of the Congresswoman's efforts.  While many NBA members continue to struggle in this difficult economic environment to raise the capital necessary to further their efforts to lend and develop the distressed communities that they have served for over 100 years, her efforts to enhance the economic resources of these communities through NBA banks have been pivotal.

Before and after the circumstances that constitute the Congressional Ethics Committee's case against Congresswoman Waters, she has been revered around the country as the go–to member of Congress who will fight to help those who have been historically deprived access to the halls of power in Washington, and she has unselfishly taken on the causes of those who could not afford high-priced and high powered lobbying firms.

While the NBA regrets that the efforts of Congresswoman Waters and her joint advocacy for the causes of the NBA have garnered questions resulting in the ethics investigation, the NBA throughout its eighty-three year existence, including all of its dealing with Congresswoman Waters, has always endeavored to apply strict standards of ethics for itself and its members and will press forward to ensure that the NBA continues its mission.

Regarding the 2008 meeting with Treasury, the NBA Chair-Elect Robert Cooper had the authority to contact Congressman Waters on behalf of the NBA to seek assistance in obtaining a meeting with the Treasury Department.  After being contacted, Congresswoman Waters did what she always does when her assistance is needed for good cause -- she acted.   In this case, she helped the NBA obtain the access that it could not obtain itself.  She contacted then Secretary of the Treasury Henry Paulson and asked that Treasury officials meet with the National Bankers Association.  Because of her efforts, that meeting took place in September, 2008.

In March of 2009, the Board of the National Bankers Association passed a motion affirming that Robert Cooper acted within his authority to seek Congresswoman Waters' assistance.  That action by the board was announced in a press release.  However, in an effort to minimize confusion related to Association representation and authority, the board voted unanimously that all future meetings with government agencies or the press should only be authorized through the office of the NBA President.  Since that time, the NBA is unaware of any meetings that have taken place outside this policy.  

According to incoming Board Chairman, B. Doyle Mitchell, "Internally, the NBA Board considers this matter closed.  As a board, we have shifted our focus to more important issues like raising capital and convincing the regulatory bodies that their examiners are exacerbating the problem of trying to unfreeze lending in America's most distressed communities."

Access to Economic Opportunities

The National Bankers Association ("NBA") is a nonprofit trade association that promotes and advocates on behalf of minority depository institutions ("MDIs") who are African-American, Hispanic-American, Asian-American, Native-American, or any other minority group.  Member institutions are deeply committed to providing employment opportunities, entrepreneurial capital, and economic revitalization in neighborhoods they serve.  The Association supports the general welfare, usefulness and inclusion of all represented.  Over one-half of NBA's members are Community Development Financial Institutions ("CDFIs"), a program of the U.S. Department of the Treasury.

According to a national business publication, from 2007 until the present, the three largest banks in America grew their asset size by 56%.  By contrast, only a small portion of the $700 billion in TARP funds (now CDCI funds) are going to NBA banks because of tough underwriting standards, while large banks were force-fed TARP money during the crisis.  As advocated by the NBA,  minority financial institutions operate at a distinct disadvantage when competing for capital even while Section 308 of FIRREA states that regulatory agencies "shall promote and preserve" minority financial institutions.

NBA member banks play a very important role in the economic fabric of the country's financial system.  Most NBA bank members exist in distressed areas of the country and lend much of their capital in those neighborhoods.  They did so before the enactment of the Community Reinvestment Act (CRA) of Congress and still do today.  Many are Community Development Financial Institutions (CDFIs) and, by definition, commit a higher percentage of their resources to low and moderate census tracks.  However, without a level playing field, member banks are finding it increasingly difficult to continue to serve distressed and underserved communities.

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