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Regulatory Reform that Promotes Economic Growth Must Include Large Banks, TCH President Says in Senate Testimony

Large banks originate a majority of small businesses loans but are subject to the highest capital and liquidity regulations



Sean Oblack


Washington, DC – June 15, 2017 – Greg Baer, President of The Clearing House Association (TCH), today testified before the Senate Committee on Banking, Housing and Urban Affairs.   In his testimony, Mr. Baer focused on reforms that can directly and immediately enhance economic growth.  

“After nearly a decade of fundamental and continuing changes to financial regulation, now is an opportune time to review the efficacy of our current bank regulatory framework,” said Mr. Baer in his opening statement. “…[I]f the goal of regulatory reform is to prompt economic growth, that goal cannot be achieved while excluding large banks from that effort. Notably, credit availability for small businesses is tighter at large banks that are subject to the highest capital and liquidity regulations.  This fact is significant because, as noted, large banks originate a sizable share of small business loans that cannot realistically be replaced by smaller banks: 54 percent by dollar amount and 86 percent by number of loans.”

Mr. Baer’s testimony focused on five areas of regulatory reform that can lead to economic growth – capital regulation; liquidity regulation; bank living wills; activity limitations, and supervision, examination and enforcement. 

Mr. Baer concluded stating, “There is no need for fundamental changes to post-crisis regulation, but there is certainly much room for improvement, particularly if the goal is stronger economic growth.”


About The Clearing House.  The Clearing House is a banking association and payments company that is owned by the largest commercial banks and dates back to 1853.  The Clearing House Payments Company L.L.C. owns and operates core payments system infrastructure in the United States and is currently working to modernize that infrastructure by building a new, ubiquitous, real-time payment system.  The Payments Company is the only private-sector ACH and wire operator in the United States, clearing and settling nearly $2 trillion in U.S. dollar payments each day, representing half of all commercial ACH and wire volume.  Its affiliate, The Clearing House Association L.L.C., is a nonpartisan organization that engages in research, analysis, advocacy and litigation focused on financial regulation that supports a safe, sound and competitive banking system. 


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