As printed in the November 2005 issue of the
America's Community Bankers Publication


AFFINITY BANK'S McGUIRE PROMOTES COMMUNITY BANKING, EXPRESSES CONCERNS OVER COMPETITIVE ISSUE IN INTERNATIONAL SPEECH

WASHINGTON, D.C. - A California banker speaking on behalf of America's Community Bankers before an international banking seminar, promoted the value of community banking, but expressed concerns about a competitive issue between large and small to mid-size banks.

Michael R. McGuire, president and CEO, Affinity Bank, Ventura, Calif., said that "community banking represents a very special commitment to serving our customers and our community. Community bankers are not just lenders, we are also leaders in our community." He was speaking as the community bank keynote speaker at the 16th Special Seminar on International Banking and Finance in Tokyo, Japan.

McGuire said community banks' great credibility in their communities enables them to compete against financial institutions of all types and sizes. In addition to involvement in their communities, community banks' outstanding service, federal deposit insurance and federal regulation are what make them credible and profitable against even the stiffest competition.

McGuire said his concerns involved an international project to allow large banks to calculate their capital requirements in a way that may disadvantage smaller institutions. The so-called Basel II proposal would "create a profound competitive disadvantage for smaller banks." He said that any new capital accord "should treat similar risks comparably so that no institution has a competitive advantage over another."

McGuire explained that if the Basel II capital accord for large U.S. banks is not accompanied by changes to the existing capital requirements for all other banks, "the larger bank would have to hold significantly less capital than the smaller bank on the same kind of loan, even though the level of risk would be the same."

America's Community Bankers, the national trade group for community banks, is leading the effort in Washington to ensure that community banks are not disadvantaged. So far, U.S. banking regulators have delayed implementation of new capital requirements for large banks and are seeking comments on revising the capital requirements for smaller banks.
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America's Community Bankers is the member driven national trade association representing community banks that pursue progressive, entrepreneurial and service-oriented strategies to benefit their customers and communities. To learn more about ACB, visit www.AmericasCommunityBankers.com.  

Affinity Bank, www.AffinityBank.com, is headquartered in Ventura, California.  The $1 billion asset bank, which specializes commercial and multifamily real estate construction, rehab and purchase financing, as well as healthcare asset-based lending and consumer and small business banking products, has branch offices in Irvine, San Francisco, Pacific Palisades, Camarillo, Encino and Ventura.  Real estate loan offices are located in    San Diego, Costa Mesa, San Bernardino, Pasadena, Sacramento, San Francisco, Ventura, Denver, Colorado, Las Vegas, Nevada, and Phoenix, Arizona.

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