WASHINGTON, July 29 — Bankers complain that lawmakers favor credit unions on policy matters, but the latest congressional financial disclosures show that key House and Senate members give banks more of their business.
Each year lawmakers report the value of their assets, liabilities, and income in ranges of dollars. The 2002 disclosures were released to the public last month, and American Banker reviewed the filings of 20 Senate Banking Committee members and 21 prominent members of the 70-member House Financial Services Committee.
These lawmakers held deposits at a combined 53 financial institutions: 68% were banks, 11% thrifts, and 21% credit unions.
Though banks were the most popular option, the lawmakers practiced some diversification: 35% reported holding both credit union and bank accounts, while 21% used only bank accounts and 10% only credit union accounts.
The Congressional and Senate federal credit unions are among the more popular financial institutions, with 50% of the lawmakers holding accounts there, but more than 90% of those lawmakers also had deposits in at least one other financial institution.
Some preferred small banks such as Rep. Maxine Waters, D-Calif., who disclosed an account, valued at between $250,000 and $500,000, held by her husband at the $450 million-asset OneUnited Bank in Boston. She also held between $1,000 and $15,000 in an account at the Congressional Federal Credit Union.
For some lawmakers, two accounts did not suffice. Rep. Sue W. Kelly, R-N.Y., and her husband, for example, held deposit and cash management accounts, with a combined value of more than $150,000, at seven institutions: Bank of New York, Congressional Federal Credit Union, Fleet National Bank, Mahopac National Bank, Union State Bank, USAA Savings Bank, and Merrill Lynch & Co.
Sen. Elizabeth Dole, R-N.C., held accounts at five institutions and preferred to bank with larger companies. One is Bank of America, where she had a personal checking account valued at between $100,000 and $250,000, even though in last year's election B of A heavily supported her Democratic opponent, Erskine Bowles.
Sen. Dole might want to look into co-sponsoring a deposit insurance reform bill introduced by some of her colleagues on the Senate Banking Committee that is aimed at increasing the coverage limit, currently $100,000 per account. She and her husband, former Sen. Bob Dole, R-Kan., each held checking accounts that exceeded $100,000.
A few lawmakers also turned to thrifts for various services. Wilmington Trust was one of the most popular ones. Sen. Thomas R. Carper, D-Del., had a Wilmington Trust mortgage worth between $50,000 and $100,000 on a Washington rental property. And Sen. Dole held between $15,000 and $50,000 in Wilmington Trust accounts.
Rep. Barney Frank of Massachusetts, the ranking Democrat on House Financial Services, listed a mortgage of $50,000 to $100,000 — also from a thrift, Flagstar Bank — on his Washington residence.
Some Senate Banking Committee members, such as Sen. Jon S. Corzine, D-N.J., chose more exclusive facilities. The panel's wealthiest member, he valued his assets at between $96 million and $187.3 million, including an equity investment worth between $250,000 and $500,000 in a Chicago bicycle shop. He also had an uncommitted revolving line of credit worth $25 million to $50 million with J.P. Morgan Private Bank.
Senate Banking Chairman Richard C. Shelby, R-Ala., and Sen. Dole are next on the list of wealthiest committee members. Sen. Shelby had assets estimated at between $8.1 million and $34.4 million. His business interests have been the source of some controversy, as he is the chairman of Tuscaloosa Title Co., a title insurance company, where, according to his disclosure report, he held shares valued at between $1 million and $5 million.
Some news reports raised conflict-of-interest questions after Sen. Shelby opposed a plan backed by the Department of Housing and Urban Development that would reform home mortgage disclosures and could hurt title companies. A spokesman for Sen. Shelby told American Banker this year that it is "completely appropriate, indeed incumbent upon" the senator "to participate in such a debate."
