{"content":[{"text":"ILCs are an intentional creation of Congress, not a loophole","bbox":{"left":0.10469,"top":0.061669,"width":0.48725499999999994,"height":0.018342999999999998}},{"text":"The first and most important point to make is about the joint trade associations’ assertion that \n ILCs operate under a “loophole” that exempts them from the Bank Holding Company Act (BHCA). The \n ILC exemption from the BHCA is not a loophole, it is an intentional creation of Congress. ILCs are \n exempt from BHCA supervision due to an intentional act of Congress when it enacted the Competitive \n Equality Banking Act of 1987 (CEBA). This status was not an accidental oversight. Congress made that \n decision in order to allow the continuing development of industrial banks, which were subject to \n regulatory oversight as banks but were owned by companies exempt from the BHCA’s activity \n restrictions. In the 33 years since the enactment of CEBA, Congress has repeatedly visited and \n modified the regulatory structure for our nation’s banks, and has repeatedly chosen to leave the \n regulatory structure for ILCs intact. Congressional intent in this area is clear. Gramm-Leach-Bliley, \n which ended commercial ownership of unitary thrift holding companies, left ILCs untouched. During \n negotiations of what became the Dodd-Frank Act, the Administration recommended removing the ILC \n exemption from the BHCA, but Congress chose not to do so.","bbox":{"left":0.10469,"top":0.092044,"width":0.783299,"height":0.20118199999999997}},{"text":"Over the past four decades, the FDIC has twice imposed moratoriums on grants of deposit insurance to \n new ILC charters for the express purpose of allowing Congress to review the exemption for ILC parents \n and affiliates from the Bank Holding Company Act. The moratorium specified in the Dodd-Frank Act \n also required the GAO to study the issue and report to Congress 18 months before the moratorium \n expired. Congress allowed both moratoriums to expire without choosing to end the ILC exemption from \n the BHCA. No incident since would warrant considering the issue again. How many times must \n Congress decline to change the current law before the trades will stop demanding another moratorium? \n The legislative record demonstrates that ILCs are not a loophole: Congress intended to allow ILCs their \n unique status and has repeatedly affirmed it.","bbox":{"left":0.10469,"top":0.305377,"width":0.785172,"height":0.14028600000000002}},{"text":"ILCs are the safest, strongest financial institutions in the nation","bbox":{"left":0.10469,"top":0.473171,"width":0.5188060000000001,"height":0.018342999999999998}},{"text":"Another, even more spurious allegation in the joint trades letter is that ILCs present a safety and \n soundness risk to our financial system. An empirical examination of ILC data shows that this is far from \n the truth. ILCs are better capitalized and more profitable than their commercial banking peers. Recent \n FDIC call report data show that in comparison to commercial banks, ILCs are better capitalized, have a \n higher return on assets (ROA), and are generally more profitable. Commercially owned industrial banks \n have a higher capital to assets ratio than the banking industry as a whole. As of December 31, 2019, \n the US banking industry had $18.6 trillion in assets and $2.11 trillion in capital, resulting in a capital-to- \n assets ratio of 11.3 percent. Industrial banks have $272.3 billion in assets and capital of $33.2 billion, \n resulting in a capital-to-assets ratio of 12.2 percent. Commercially owned industrial banks have $15.2 \n billion in assets and $2.2 billion in capital, resulting in a capital-to-assets ratio of 14.8 percent.","bbox":{"left":0.10469,"top":0.503572,"width":0.783391,"height":0.1555629999999999}},{"text":"Likewise, for the year ending December 31, 2019, the banking industry reported net income totaling \n $232.8 billion, resulting in an annualized return on assets (ROA) of 1.27 percent. Industrial banks’ net \n income for the period totaled $9.23 billion, resulting in an annualized ROA of 3.54 percent. \n Commercially owned industrial banks reported net income totaling $293.7 million during that period,","bbox":{"left":0.10469,"top":0.671286,"width":0.7681979999999999,"height":0.06406099999999992}},{"text":"2","bbox":{"left":0.885882,"top":0.882667,"width":0.00813699999999995,"height":0.016776000000000013}}],"images_bbox":[{"left":0.0,"top":0.765759,"width":0.990196,"height":0.106361}],"images_bbox_not_text_overlap":[{"left":0.0,"top":0.765759,"width":0.990196,"height":0.106361}]}