Viewpoint: Mark-to-Market Rules' Distortions and Impairments

Local banks provide the responsible loans families need to purchase homes and send their kids to college. They also work with local businesses to provide funding that expands businesses and creates jobs.

The strength of these local relationships is one reason community banks have weathered the economic crisis far better than larger institutions. But even the sturdiest community banks are at the whim of mark-to-market accounting, which distorts the values of the securities these banks hold — securities backed by the mortgage, consumer and student loans that keep their communities running.