Capital Briefs: Small Banks Eye Insurance, Not Underwriting

Just like the big institutions, community banks want to offer more products. But according to a new study by the accounting and consulting firm Grant Thornton, expanding insurance powers is a high priority for community banks, and Glass-Steagall repeal is not.

In fact, 52% of the community bankers surveyed listed new insurance powers as one of their legislative priorities. On the other hand, only 4% considered securities underwriting to be crucial to their competitiveness during the next five years.

"Clearly, Glass-Steagall reform is not high on community banks' wish list for Washington," said Diane M. Casey, Grant Thornton's national director of financial services.

While more than half the bankers said retail insurance powers are important to the franchise value of their institutions, only 16% rated them "very important" and a mere 5% said they were essential.

Regulatory relief is also on community bankers' Washington agenda, but only 6% of those surveyed believe regulations will be less burdensome within five years.

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