A survey shows that community bankers remain pessimistic about regulatory reform despite the change in control of Congress.

The study, conducted by accounting firm Grant Thornton, asserts that very few bankers are confident that the government will take meaningful action on two of the three issues most important to them: regulatory relief and repeal of the tax exemption for credit unions.

"It comes down to the fact that despite a new Congress, community bankers remain doubting Thomases about Washington," said Diane M. Casey, national director of financial institutions regulatory issues at Grant Thornton. "Call them pessimistic, call them realistic - bankers still need convincing that government will relieve their regulatory burden rather than add to it."

Ms. Casey said bankers, while positive overall about the Republican sweep in Congress and the new leadership's promises to reduce regulatory burden, are wary of promises that they've heard before.

"A lot of the regulatory relief measures in the recent past were welcome but modest," she said. "At the same time, they face new forms of regulation all the time . . . Congress is still going to have to prove itself."

Bankers overwhelmingly said their top three governmental/regulatory priorities were regulatory relief, credit union taxation, and reduction of the bank insurance premium. But, while 53% said they expected a reduction in the insurance premium this year, only 8% expected "meaningful" regulatory relief and just 3% expected credit unions to be taxed.

In contrast to the regulatory situation, the 808 respondents were very optimistic about the national economy and their own banks' financial performance.

The survey showed that 52% of bankers believe the U.S. economy is well on its way to recovery, twice the 27% who were equally optimistic in a similar survey last year.

In addition, 56% said their bank's earnings will increase in 1995, with 11% predicting a "significant" increase.

Another 23% said their earnings will decrease in 1995, compared with 26% who said the same last year.

In terms of their regional economies, bankers are less sure, however. Only 35% of community bankers said their region was on the way to recovery. But 34% said their region never was in a recession. Another 13% said their region is still in a recession, less than the 21% who said the same last year.

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