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David Baris quoted in Bloomberg Law article, “Bank startups seek more clarity in FDIC application process”

Bloomberg Law

David Baris

David Baris was quoted on November 27, 2018 in a Bloomberg Law article, “Bank startups seek more clarity in FDIC application process,” which discussed the Federal Deposit Insurance Corporation’s plan to make the bank startup process faster and more transparent. The article stated, “New bank charters, known as de novos, have ticked up recently following several years of inactivity caused by the 2008-2009 financial crisis. The FDIC has cleared 10 applications so far this year, exceeding the nine approvals in 2016 and 2017. But activity remains low amid complaints from bankers that the process is poorly defined and cumbersome.”

Baris noted, “Even if you go back to the Great Depression, you’d see many more banks being formed than there are now.” Baris also commented on regulators improving the application process by avoiding the tendency to second-guess bank organizers on business plans and the market. He added “A qualified board and management team could be successful on Mars. Commercial real estate loan concentrations, for instance, often raise red flags with agencies reviewing new bank applications. Qualified startup organizers who can raise sufficient capital should be given the benefit of the doubt. It goes back to the judgment about the group. Are they experienced? Do they know what they’re doing? Do they have a history in that kind of lending? Do they have people on board who can do that kind of lending prudently?”

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