Remarks by
Jelena McWilliams
Chairman
Federal Deposit Insurance Corporation
at the
Community Development Bankers Association
Peer Forum and Membership Meeting
Washington, D.C.
June 4, 2019
____________________________________
Good afternoon. Thank you for inviting me to speak here today.
The mission of the FDIC – in particular, our goal to expand economic inclusion – is one that
resonates with me on a deeply personal level. I spent my 18th birthday on a plane en route to the
United States, with $500 in my pocket and the dream that I could make it.
Within six months of my arrival, the airline that brought me to the U.S. and my former homeland
both ceased to exist. As I am about to reach my first anniversary at the FDIC – with the FDIC
still around and in good shape, if I may add – I cannot help but marvel at the many opportunities
that have been available to me during those 28 years.
The day after I arrived in California, I opened a checking account at a bank, and deposited all of
my $500 in that account. It did not take long for me to realize that, in addition to a checking
account, I should have a credit card.
I applied for a credit card, but with no credit history and no assets other than that meager $500, I
was denied. Instead, I was offered the option to open a secured credit card and I jumped on it. If
you really think about it, the entire concept did not make sense: I was essentially borrowing from
myself while the bank held my money as collateral and collected the interest. But with each
swipe of that credit card I felt more integrated into the very fiber of American society.
After 12 on-time monthly payments, the bank released my security deposit. With my newly
established credit history, I was able to obtain an unsecured credit card, and a world of
opportunities opened up. From there, I built my credit history and qualified for an auto loan,
student loans, and, eventually, a mortgage for my first home. (In fact, two mortgages, as one
was insufficient.) I understand from personal experience how important the financial system is
to people of all walks of life.
Jelena McWilliams
Chairman
Federal Deposit Insurance Corporation
at the
Community Development Bankers Association
Peer Forum and Membership Meeting
Washington, D.C.
June 4, 2019
____________________________________
Good afternoon. Thank you for inviting me to speak here today.
The mission of the FDIC – in particular, our goal to expand economic inclusion – is one that
resonates with me on a deeply personal level. I spent my 18th birthday on a plane en route to the
United States, with $500 in my pocket and the dream that I could make it.
Within six months of my arrival, the airline that brought me to the U.S. and my former homeland
both ceased to exist. As I am about to reach my first anniversary at the FDIC – with the FDIC
still around and in good shape, if I may add – I cannot help but marvel at the many opportunities
that have been available to me during those 28 years.
The day after I arrived in California, I opened a checking account at a bank, and deposited all of
my $500 in that account. It did not take long for me to realize that, in addition to a checking
account, I should have a credit card.
I applied for a credit card, but with no credit history and no assets other than that meager $500, I
was denied. Instead, I was offered the option to open a secured credit card and I jumped on it. If
you really think about it, the entire concept did not make sense: I was essentially borrowing from
myself while the bank held my money as collateral and collected the interest. But with each
swipe of that credit card I felt more integrated into the very fiber of American society.
After 12 on-time monthly payments, the bank released my security deposit. With my newly
established credit history, I was able to obtain an unsecured credit card, and a world of
opportunities opened up. From there, I built my credit history and qualified for an auto loan,
student loans, and, eventually, a mortgage for my first home. (In fact, two mortgages, as one
was insufficient.) I understand from personal experience how important the financial system is
to people of all walks of life.
2
Community Banks
As of March 31, there are 4,930 insured community banks in the United States. As the primary
federal supervisor for many of these institutions, the FDIC is uniquely positioned to assess and
observe the vital role small banks play in local communities and in the U.S. economy overall.
Our latest Quarterly Banking Profile reports that the annual rate of loan growth at community
banks was 6.6 percent in the first quarter, stronger than the overall industry. This growth was led
by commercial real estate loans, residential mortgages, and commercial and industrial loans. Net
income at community banks also surpassed the overall industry, growing by 10.1 percent from a
year earlier.
Supporting this segment of the banking system is paramount. Community banks in the U.S. are
intertwined in a symbiotic relationship with their communities: if those communities do not do
well, neither will their community banks.
The role of regulatory agencies is not to stand in the way of those relationships but to encourage
them. To achieve that goal requires that regulators get out of the D.C. “beltway” and hear
firsthand both from the bankers and the communities they serve. In my first year at the FDIC, I
am almost halfway through a 50-state listening tour. Informed by these meetings with local
bankers, state supervisors, consumer groups, and FDIC employees, I have directed the FDIC to
increase our efforts to:
Actively seek ways to reduce regulatory burden on our community banks;
Encourage community banking, including the establishment of de novo banks in
communities of all sizes;
Promote and preserve the nation’s Minority Depository Institutions (MDIs);
Modernize the Community Reinvestment Act (CRA) framework and provide clarity to
institutions on their CRA obligations; and
Ensure that our regulatory framework encourages banks to offer products and services to
low- and moderate-income households.
Minority Depository Institutions
One of the FDIC’s statutory responsibilities is to preserve and promote the health of MDIs. The
vitality of MDIs is critical, given their role in the economic well-being of the minority and
traditionally underserved communities many MDIs serve. The FDIC fully embraces its role in
supporting these institutions and we have increased our support through the following actions:
In 2018, we appointed a full-time, permanent executive to manage MDI programs across
the FDIC;
We have increased the representation of MDIs on the FDIC’s Community Bank Advisory
Committee (CBAC);
Community Banks
As of March 31, there are 4,930 insured community banks in the United States. As the primary
federal supervisor for many of these institutions, the FDIC is uniquely positioned to assess and
observe the vital role small banks play in local communities and in the U.S. economy overall.
Our latest Quarterly Banking Profile reports that the annual rate of loan growth at community
banks was 6.6 percent in the first quarter, stronger than the overall industry. This growth was led
by commercial real estate loans, residential mortgages, and commercial and industrial loans. Net
income at community banks also surpassed the overall industry, growing by 10.1 percent from a
year earlier.
Supporting this segment of the banking system is paramount. Community banks in the U.S. are
intertwined in a symbiotic relationship with their communities: if those communities do not do
well, neither will their community banks.
The role of regulatory agencies is not to stand in the way of those relationships but to encourage
them. To achieve that goal requires that regulators get out of the D.C. “beltway” and hear
firsthand both from the bankers and the communities they serve. In my first year at the FDIC, I
am almost halfway through a 50-state listening tour. Informed by these meetings with local
bankers, state supervisors, consumer groups, and FDIC employees, I have directed the FDIC to
increase our efforts to:
Actively seek ways to reduce regulatory burden on our community banks;
Encourage community banking, including the establishment of de novo banks in
communities of all sizes;
Promote and preserve the nation’s Minority Depository Institutions (MDIs);
Modernize the Community Reinvestment Act (CRA) framework and provide clarity to
institutions on their CRA obligations; and
Ensure that our regulatory framework encourages banks to offer products and services to
low- and moderate-income households.
Minority Depository Institutions
One of the FDIC’s statutory responsibilities is to preserve and promote the health of MDIs. The
vitality of MDIs is critical, given their role in the economic well-being of the minority and
traditionally underserved communities many MDIs serve. The FDIC fully embraces its role in
supporting these institutions and we have increased our support through the following actions:
In 2018, we appointed a full-time, permanent executive to manage MDI programs across
the FDIC;
We have increased the representation of MDIs on the FDIC’s Community Bank Advisory
Committee (CBAC);