The Mississippi Bankers Association (MBA) has a long history of serving member banks throughout the state. Founded in 1889, the MBA has 97 full-service financial institutions as members, representing 99% of the bank deposits in Mississippi.
The Mississippi Business Journal caught up with association president McKinley “Mac” W. Deaver to find out what’s going on with this busy organization and its members.
Mississippi Business Journal: Have there been any major changes in the industry in the past few years?
Mac Deaver: Consolidation within the banking industry has continued. At the same time, branches have continued to proliferate. Many banks continue to work to expand their product and service lines in a very competitive financial services market. The proliferation of non-bank entities — such as mortgage brokers, check cashers and others — has brought new options, and in some cases new problems, to financial consumers.
Commercial banks continue to deal with increased regulatory requirements that cost the industry hundreds of millions of dollars each year. In recent years, the regulatory burden related to the Bank Secrecy Act and other anti-terrorist laws has been an increasing burden to banks.
Banks fully support the government’s efforts to fight terrorism; however, banks want to assure that the measures imposed are effective. In some cases, the evidence is that they are not. Regulatory expenses take away from banks’ ability to serve customer needs.
MBJ: How does the association remain relevant to members’ needs and the dynamics of the industry?
MD: Our focus continues to be on government relations, education and communication. We keep our membership apprised of developments at the state and federal levels, and we advocate positions on behalf of Mississippi’s banks. We are politically active, working to activate bankers and to support good candidates for legislative and appellate judge positions in the state.
At the federal level, we work with other state associations around the country and with the American Bankers Association and other national groups to advocate positions on the industry’s behalf.
The MBA conducts approximately 40 seminars and conferences each year on bank-related subjects, and we operate our annual banking school, which continues to experience maximum enrollment. We also offer online and telephone training.
Our annual convention is one of the largest state bankers’ conventions in the nation.
We offer an increasing number of products and services to member banks, providing them with benefits they would not enjoy independent of the association. For example, we provide free access to FraudNet, a secure online network providing communication about financial fraud cases in the state and nation, to members and law enforcement agencies.
Our communication program is extensive, including many printed and electronic publications. We work to promote the many positive things banks do, such as provide consumer education in schools and communities. Recently, the Mississippi Young Bankers, a section of the MBA, was recognized for its financial literacy program.
Perhaps the most important thing we do is promote communication within the industry, preparing bankers to work together for positive change and for solutions to economic and industry problems when they arise.
MBJ: Was the association pleased with the outcome of state legislative issues it promoted this year?
MD: With 2007 being an election year, this year’s regular session of the Mississippi Legislature did not deal with a great number of specific bank-related issues.
One bill that was enacted with MBA support was “credit freeze” legislation, which allows consumers to freeze their credit bureau information upon the occurrence of identity theft, as documented by a police report. Our association worked for passage of this bill as an alternative to a proposal to allow consumers to freeze their credit for any or no reason. The credit reporting system provides tremendous benefits to consumers.
MBJ: How are national banking issues affecting Mississippi banking?
MD: Nationally, there has been a lot of publicity and reaction recently to the reports of increased foreclosures and certain mortgage lending practices. Members of our association don’t engage in the practices which are under scrutiny. Our effort has been to make sure that any solutions don’t penalize the banks of Mississippi who are operating soundly and fairly and in the best interest of consumers and their communities.
Also, there are ongoing proposals to expand the authorities of certain government-favored entities engaged in financial services. These include the Farm Credit System (FCS), credit unions and industrial loan companies (ILCs). Our association opposes the expansion of these entities into general lending and financial services, putting them into direct competition with fully regulated and taxed banks. Competition in financial services is a healthy thing; unfair, unregulated competition is not.
Recently, the U.S. House defeated legislation to expand FCS into virtually all areas of lending. The MBA worked against this effort to take Farm Credit away from its mission to support farming and to allow FCS to compete with banks and other entities in other areas while enjoying government-sanctioned benefits not available to banks.
We strongly oppose the expansion of certain credit unions, which are seeking to serve the general public, rather than those consumers credit unions were established to serve, while enjoying tax and regulatory benefits above those offered to commercial banks.
Also, the effort by commercial firms such as Wal-Mart to engage in financial services through the expansion of ILCs is a serious violation of the long-adhered-to separation of banking and commerce. Banks have a mission to serve public needs, and they are held to this mission by their regulated chargers.
Industrial banks operated by commercial entities have a wholly different mission — to serve the financial goals of its parent company. The unfettered expansion of ILCs is a serious threat to the important role of banking in Mississippi and its communities.
MBJ: Is there anything else new going on with the association?
MD: Recently, we have increased our outreach program, which puts our association leaders out in the field visiting member bankers. We are also working to increase the products and services offered to member banks.
Contact MBJ contributing writer Lynn Lofton at email@example.com.