Ohio bankers are keeping an open mind about a possible gubernatorial run by Richard Cordray.
While Cordray hasn’t announced any plans, his tenure as director of the Consumer Financial Protection Bureau is enough to make bankers nervous in a 2018 race to succeed Gov. John Kasich that already has several declared candidates.
Bankers are “by no means happy with the CFPB as an agency and what it has done,” said J.T. Thurston, vice president of public relations for the Ohio Bankers League. The agency’s policies, including the qualified mortgage rule “constrained banks, particularly community banks, in terms of the amount of lending that they can do.”
Still, it is too soon to say bankers are completely opposed to a Cordray candidacy. In fact, some are willing to hear him out.
Donald Hileman, president and CEO of the $2.9 billion-asset First Federal Bank of the Midwest in Defiance, said that he would like to see a platform before making a decision, and that he has mixed feelings about Cordray’s time at the CFPB.
Though the agency has “too many one-size-fits-all policies,” Hileman said, there has “clearly been a positive tone” toward consumer protection.
“His experience would be valuable to the state,” Hileman added. “It goes back to just what is the agenda that he would bring to his campaign to run for the governor.”
Leading the CFPB is a “difficult position” to have, said Howard Boyle, president and CEO of the $187 million-asset Hometown Bank in Kent. The agency is “just one additional bureaucracy that’s technically unnecessary,” he said.
Cordray “has probably handled it as well as anyone could,” Boyle conceded, though he said it is early to throw his support behind any contender. “I really don’t have a feel for his ability to be governor, frankly.”
While the Community Bankers Association of Ohio has taken issue with some CFPB policies, including the collection of small-business data, Bob Palmer, the association’s president and CEO, said the agency has been flexible in areas such as the rural designation for lending.
Cordray has shown that he can listen, Palmer said, adding that his group welcomes anyone who wants to run.
“Choice is a good thing,” he said.
It is unclear what impact, if any, Cordray could have on Ohio’s financial services industry if he were to win, though he has at times been open to hearing bankers' views during his political career in the state. Bankers, for instance, were part of a post-crisis task force he assembled as the state’s treasurer.
State politics could also restrain the next governor’s influence in a state that is home to 192 banks, including dozens of community banks and regional players such as KeyCorp in Cleveland, Fifth Third Bancorp in Cincinnati and Huntington Bancshares in Columbus.
Cordray “would be limited in what he can do anyway,” Thurston said. “Politically, he would be constrained by the composition of the [largely Republican] state legislature here.”
The CFPB declined to comment.