The name may be familiar. Tennessee Bank & Trust, that\’s been part of a bigger company, currently is striking out. That dollars a newly released trend since Tennessee had lost nearly a bank per month over the last few years, mainly through acquisitions and mergers.
There hasn’t been a whole new bank to promote in Tennessee since until the financial crisis. The TBA president Colin Barrett blames what he considers onerous regulations in the Dodd Frank Act intended to rein in Wall Street.
“The reason banks are getting out… is the same reason why banks are not starting, because those challenges are identical,” he states.
Barrett says even small banks are receiving to hire compliance experts rather then more loan officers, turning it into harder to turn a profit. He say\’s its even harder on consumers. The shrinking variety of individual banks have made loans somewhat tougher to come by; especially in rural areas.
As Tennessee Bank & Trust announced its approval for the new state charter to become a locally-focused in Tennessee, a spokesman observed that regulators are “practically begging” for new applications. For years, banking officials discouraged the growth of new lenders, preferring possible investors to drive their capital into existing institutions.
Tennessee banks are continuing to consider state-based regulators rather than federal authorities having primary oversight, or better known as a charter conversion. 12 banks in the last five years dropped their national credentials for being state-chartered in Tennessee. This will be fruitful for in Tennessee.
It\’s been a nationwide trend since that time the passage of financial reforms adopting the financial crises in 2008. Tennessee Commissioner of economic Institutions Greg Gonzales says his bank examiners see institutions that have a spotty history.
Gonzales says he\’s more concerned with the economic health of the state than federal regulators may be.
“Our mission is, number 1, safety and soundness,” he says. “But it’s also to do it in a way that puts institutions in a very great position to contribute to economic progress.”
Gonzales denies that his office will be any more lenient. But an investigation out of the University of Chicago saw that state regulators consistently went easier on banks than federal authorities much like the Office of the Comptroller of the Currency.
The latest conversion in Tennessee was in October when Dickson\’s First Federal traded in the national charter. The largest chartered bank is Pinnacle Financial, which changed in 2012.
\”In this environment of fast-paced regulatory changes and all sorts of uncertainty that surrounds it, I do believe there is great value in close hitting the ground with regulatory decision makers who can meet face-to-face and who see the nuances of our markets,\” Pinnacle CEO Terry Turner said during the time.