Now that America's Community Bankers is merging with the American Bankers Association, what might become of ACB's remaining state association members?
ACB, which primarily represents thrifts, and the ABA said last week that they are combining, largely because banks and thrifts have more similarities than differences these days. A combined organization also would have more lobbying clout, both groups said. Related Link
And Jim Turner, the president of the Heartland Community Bankers Association, says his Topeka, Kan., group, which represents 43 thrifts in Kansas, Nebraska, Oklahoma, and Colorado, also is not going anywhere. In fact, he said that it would try to position itself as the trade group of choice for thrifts, and that it might start recruiting members from outside its four-state region.
Of course, with the industry continuing to consolidate, most state bank and thrift trade groups have already merged, leaving just a handful of states — including Illinois, New Jersey, and Washington — with trade groups made up almost exclusively of thrifts. There is one other multistate trade group, the Tri State League of Financial Institutions, which is made up mostly of thrifts in Ohio, Kentucky, and Indiana.
Heartland's Mr. Turner said that he understands why the ABA and ACB would want to combine, because they face competition for congressional attention with the Financial Services Roundtable and lobbyists from the individual big banking companies.
(Also in the mix is the Independent Community Bankers of America, which represents mostly small commercial banks.)
Mr. Turner said Heartland would look into filling the void for thrifts. "We will expand the scope of the membership opportunities [for institutions] if they want to stay with a thrift organization."
He also said that his group's members "have a great deal of concern" with the merger between ACB and the ABA, "because they want to keep a thrift regulator."
The pending merger has raised questions about the future of the Office of Thrift Supervision, because ACB has been the agency's most vocal supporter.
The ABA once favored combining the OTS with the Office of the Comptroller of the Currency but changed course about eight years ago. Ed Yingling, the ABA's chief executive officer, assured thrift executives last week that retaining a separate regulator for thrifts would be among the trade group's "highest priorities."
(However, Treasury Secretary Henry Paulson may have other ideas. He said last week that he intends to recommend sweeping changes to financial services regulation early next year. Some industry observers suspect that those changes could include merging the OTS and the OCC.)
Jay R. Stevenson, the president of the Illinois League of Financial Institutions, agreed that, at the Washington level, a merger between trade groups makes sense, especially in light of industry consolidation. "The statistic I heard is that the combined organization would represent almost 90% to 95% of assets in the U.S.," Mr. Stevenson said. "It probably doesn't hurt to face a congressional committee with those stats behind you."
But that merger probably would not prompt a similar one in Illinois, he said, because each trade group has its own strengths.
"The three trade groups that operate in Illinois have mapped out their own constituencies and expertise and have a balance of power," Mr. Stevenson said. "What happens in Washington should not change that."
New Jersey also has a state thrift trade group, but maybe not for long. James R. Silkensen, the president of the New Jersey League of Community Bankers, said his group is likely to merge with the New Jersey Bankers Association in the next few years.
The two groups had been in talks to merge last year but called them off in April. Talks broke down over unspecified financial matters, but Mr. Silkensen said that after those issues are worked out, the groups would revisit the subject of a combination.
Discussions "ended on a very cordial basis," he said. "There was agreement that such a merger would make sense maybe a couple or three years down the road."
