DD a Stunner

I have had the interesting experience of traveling around the country during the past few weeks running workshops and seminars on the new Truth-In-Savings regulation, Reg. DD.

After producing and running seminars for over ten years, I find that bankers are pretty consistent at these affairs. Get a banker to a conference or a workshop with others who do the same job they do, and they TALK. They compare methods, systems, features, bosses and, once in a while, they even get to the subject matter of the workshop!

When Regulation CC was introduced to these bankers in 1988, there was some muttering and cursing and a lot of protesting. But somehow the industry muddled through.

Then the Bank Secrecy Act blew up-and compliance officers are still reeling from the impact of some of that legislation.

Then Reg D started to shake up some troops, and changes in HMDA and RESPA were dealt with by compliance officers. Security Officers bore the brunt of the changes in the Bank Protection Act. And don't forget CRA and ADA!

And now, along comes Regulation DD, as mandated by the Federal Deposit Insurance Corporation "Improvement" Act. (Emphasis is editor's)

For the first time, bankers are responding differently to regulations explained in workshops. As I mentioned, bankers talk at these sessions-asking a lot of questions, trying to understand and apply the differences to their own individual institutions. Not at sessions on Reg DD.

There is no banter-no good natured, "Ah, what the heck-we've dealt with this before-we can do it again" attitude.

There is silence.

An unnerving, expressive silence that tells me that these compliance and operations officers are reaching the overload stage.

Reg DD is going to be expensive to implement. (BANKERS' HOTLINE is going to do what we can to help-see article to the right on this page.) Most consumers will never read the voluminous disclosures we are going to have to print. If we listen to contacts in Washington, the regulators and examiners are going to be nit-picking and merciless on details. The entire exercise is going to be complicated, time consuming, and is in the opinion of many banking experts totally unnecessary.

The cost in dollars will, of course, be passed on to the very consumer this regulation is meant to "inform". The cost in morale and attitude in the banking industry is immeasurable. Banking officers have seen their staffs cut, salaries frozen, bonuses disappear and job security threatened. And now they must deal with a Regulation that will increase their workload, complicate their communication with customers, promises no positive results, that has many pitfalls.

One could wish the new Congress will have members that will think out the conclusion and effect of their actions on the banking industry.

We can only hope.

Copyright © 1992 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 3, No. 6, 11/92