Nearly half of all banks have had to reduce their offerings of financial products and services because of growing regulatory compliance burdens, new data show.
A combined 46.3% of respondents said their bank had cut offerings for loan accounts, deposit accounts, or other services because of regulatory effects, according to the American Bankers Association’s 2015 Survey of Bank Compliance Officers.
The web-based, biennial survey was conducted from February through March 2015 to collect information about compliance officers and the compliance function practices at their bank. Over 450 financial institutions—78.5% of which reported to be community banks—participated in the 70-question survey.
In addition, compliance concerns are also keeping financial institutions from launching new products. Forty-six percent of bank compliance officers reported their institution had decided not to launch a product, open a new channel, or had held off on entering a new market, temporarily or permanently, due to compliance concerns.
“It’s clear that the compliance burden brought on by Dodd-Frank has had an impact not only on banks, but more importantly on the customers and communities they serve,” said Frank Keating, ABA president and CEO, in the survey. “This regulatory overcorrection has limited the loans, products and services available to consumers.”
Access the survey here.
Written by Cassandra Dowell