Posted on 08/15/2011 5:10:39 PM PDT by Kaslin
Regulation: A Texas bank is preparing to shut down. No, it's not a failed institution being closed by federal agents. It serves its market. It makes a profit. So what's the trouble? It's sick of the heavy hand of government.
Main Street Bank of Kingwood, Texas, is a modest business. It has four branches and employs 60. It earned $11 million in the last year. The 27-year-old bank seems healthy.
The business climate it operates in, however, is not.
"The regulatory environment makes it very difficult to do what we do," Main Street Chairman Thomas Depping has told the media.
Fed up with the federal restrictions, Main Street Bank is selling its branches and deposits to Green Bank NA and $150 million in loans to newly created Ascentium Capital. Depping, who will be Ascentium's president and CEO, describes the new institution as one that will lend to businesses that have yearly revenues of less than $1 million and need loans of as much as $100,000.
Depping's new venture will have backing from Vulcan Capital, the investment firm of Paul Allen, owner of the NBA's Portland Trail Blazers and co-founder of Microsoft. Allen says Ascentium will serve "the important but underserved market for small-balance commercial loans and leases in the United States."
Because this new lender is not a bank, it will not be subject to bank regulators, which increases the likelihood that small businesses will get the loans they need.
The trouble at Main Street and other banks began a little more than a year ago, when the president signed the Dodd-Frank bill into law. Known as the Wall Street Reform and Consumer Protection Act, it was written and passed in response to the 2008 financial crisis.
(Excerpt) Read more at investors.com ...
bump
The entire point of the Frank-Dodd bill was to choke out smaller local and regional banks. The big banks hate competition and the politicians enjoy the cozy relationship they have with the big banks.
It seems we have a gangster-fascist government that is in happy collusion with big business.
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