Mr. WORTLEY. My time has expired, but I wonder if I might just ask one final question. Mr. Angermeuller or Mr Petty, do either of you have any statistics on employment in the banking industry specifically, the change in amount of employment over the past 10 years. Mr. PETTY. They are definitely available. Chairman ST GERMAIN. Would you please submit that for the record? Mr. PETTY. Certainly. Mr. WORTLEY. My time has expired. I thank you, gentlemen. Chairman ST GERMAIN. Mr. Barnard, for a brief question, he tells me. Mr. BARNARD. Gentlemen, I just want to clear up one thing, the $250 million threshold. Yes or no, do you think that the threshold could be dropped below the $250 million mark? Mr. LAWARE. Yes. Mr. ANGERMUELLER. Yes. Mr. PETTY. Yes. Mr. BARNARD. You were here this morning when I talked with Chairman Volcker about trying to provide somewhere in here for farm banks if it was just on a specified, pinpointed basis. I do not know that we are going to be able to do that. But if it was possible to do that, do you think, No. 1, it would be justified, and No. 2, that the Association of Bank Holding Companies would support that? Mr. LAWARE. Yes, I do. Our feeling is that the regulators ought to have the authority to go to the out-of-State bidding process regardless of the size of the bank if in fact there is no intrastate mechanism that is available to keep that bank in business. Mr. BARNARD. What happens is we still come back to what is the consumer interest in all of this, and I can see the consumer interest here would be to save the community bank in the farming area, and a lot of times that could be done. It may not be done, but on the other hand, with FSLIC or FDIC assistance and some outside ownership, it could be done. That is what you call bringing capital in. I just feel like it is worth addressing in this bill. Mr. PETTY. In the interstate banking bill, the Douglas amendment as now drawn, you cannot own more than 5 percent of the bank. We were offered 20 or 15 percent of banks in farm areas which we were considering but could not do that by law without going to the control position. That is what I mean when I say I think our laws are constraining and not responsive to the community needs. Mr. ANGERMUELLER. If I might, Congressman Barnard, I think if you drop the floor entirely, I would certainly favor that. Since there are adequate procedures in the bill to give preference to the in-State bidder, I would be a little reluctant to just identify farm banks, because tomorrow it may be some different industry that is concerned. But once you have dropped the threshold totally, or substantially down, it seems to me that the procedures contemplated by the regulators' bill, which would give in-State priorities, would be adequate to deal with the situation. Mr. BARNARD. Thank you very much. Chairman ST GERMAIN. Are there any further questions? [No response.] Chairman ST GERMAIN. We would like to express the appreciation of the subcommittee to you gentlemen for your assistance in this matter. I have got a few questions I am submitting in writing, as do some of my colleagues, and we would appreciate the answers as soon as possible so that we can be prepared when the markup process comes. The subcommittee stands adjourned until 10 a.m. tomorrow morning. [Whereupon at 1:30 p.m., the subcommittee was adjourned to reconvene at 10 a.m., Thursday, May 8, 1986.] APPENDIX OPENING STATEMENT OF HON. CHALMERS P. WYLIE HEARINGS ON PROPOSED LEGISLATION BY FEDERAL REGULATORY May 7, 1986 Thank you Mr. Chairman. I would like to welcome Chairman Volcker and our distinguished panel of witnesses. I am inclined to support the extension of the Garn-St Germain emergency acquisition provisions. It is my judgment that these provisions have been extremely useful to the regulators in resolving problems confronted by some of our financial institutions. And the regulators have now asked us to enhance these authorities to further increase their options and flexibility in responding to financial institution failures. I think all would agree that the banking supervisors must have adequate tools to deal with emergency situations quickly and effectively. The disagreement seems to arise over the question of present need what exactly is the extent and magnitude of the current banking problem. Of course, we need to explore these questions and thoroughly evaluate the many alternatives suggested by the witnesses and that's exactly what we're doing in these hearings. I do think we need to keep our perspective. The regulators have been charged by the Congress with the job of maintaining confidence in our banking system and they must have any needed authorities to carry out that responsibility. I think Chairman Volcker brings candor to this debate 2 with his statement that the additional powers sought by the regulators are precautionary, that they perhaps will, in the end, not have to be used, but that it would be imprudent to rely on that hope. Mr. Chairman, I speak from the perspective of one who lived through a crisis in confidence involving some 70 thrift institutions in Ohio just last year. That experience clearly demonstrated that regulators must be prepared and must have necessary authorities. That experience also clearly demonstrated that in an emergency situation, an interstate acquisition can have far reaching benefits for depositors and local communities. In Ohio, the Chase Manhattan Bank acquired six S&L's insured by the ODGF (including 22 branches) and converted them into a state chartered bank. This action brought immediate benefits to thousands of depositors whose accounts had been frozen for some time and continues to provide benefits in expanded deposit account services, employment (which will increase by over 100 by year-end 1986), and the existence of a strongly capitalized competitor that is currently extending loan commitments to Ohioans at a rate of over $1 million a day. Moreover, this new institution picked up the pieces in the aftermath of the failure of the ODGF pieces that might not have been picked up otherwise. And, of course, the Chase Bank is subject to all the same laws and regulations, including the Community Reinvestment Act, as other Ohio institutions. Mr. Chairman, I look forward to hearing from our distinguished witnesses. To assist this Subcommittee in the discharge of its responsibilities, you are requested to appear on Wednesday, May 7, 1986, in Room 2128 Rayburn House Office Building at 10:00 a.m., to provide testimony to the Subcommittee on H.R. 4701, the Financial Institutions Emergency Acquisitions Amendments of 1986, legislation proposed by the Federal bank regulatory agencies, and on related issues. More specifically, you are asked to testify on the matters of concern to the Subcommittee set forth in the enclosure. In accordance with Committee Rules, please deliver 175 copies of your prepared statement to Room 8303 Rayburn House Office Building twenty-four hours in advance of your scheduled appearance. Your statement in its entirety will be included in the hearing record and, if delivered as requested, the statement will be made available to all Subcommittee Members in advance of the hearing. Το provide all Subcommittee Members with sufficient time for questioning, the oral presentation of your prepared statement must be limited to twenty minutes. Sincerely, Enclosure Fernand J. St Germain |