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Yesterday, Tom chastised the comptroller of the currency for comments in a speech last week that seem to indicate his agency intends to pursue the same take-no-prisoners regulatory approach during this credit downturn that proved so harmful to the banking system during the last one, in the early 1990s.
I agree with Tom. The OCC is an agency that’s arrogant, out of touch with the banking industry, and out of control in general. It runs a high risk of inflicting needless pain on the system at a very bad time.
I have a suggestion for how Dugan might improve things: the OCC, like any large organization, needs to listen to its constituents. It certainly needs to spend more time and effort hearing what the banks and bankers it regulates have to say, and to allow them to be more active participants in the decision-making matrix.
Banks are the ones that pay the OCC’s bills. Yet when was the last time the comptroller and his senior aides had meaningful discussion with banking executives, or received feedback from them?
I’m not talking about one-way PowerPoint talkathons, either, but real give-and-take discussions about fixing the system’s problems and rebuilding trust between the industry and the government.
As the CEO of a national bank for over 30 years, I never had a truly constructive discussion with the senior management of the OCC. Rather, most meetings were basically lectures during which the OCC and its people were never wrong and every problem was all about bankers’ mismanagement.
Comptroller Dugan, use this opportunity to begin real open, two-way dialogues with the banking industry. If you don’t, the industry will have to assume you have no interest in finding a constructive approach to addressing the industry’s problems.
What do you think? Let me know!