Tester defends banking bill

Montana's senior senator Wednesday defended statements he made about the Dodd-Frank Wall Street Reform and Consumer Protection Act.

In a telephone press conference, Sen. Jon Tester, D-Mont., responded to a story by the Associated Press that said past statements he made about Dodd-Frank's effect on smaller community banks were only "mostly true."

The 2010 Dodd-Frank bill was passed to prevent a repeat of the 2008 Great Recession in an attempt to regulate financial institutions that became "too big to fail."

Tester voted for Dodd-Frank when it passed the Senate in 2010 and was an original co-sponsor of the bill that passed the Senate last week that rolls back some regulations on banks and credit unions.

An Associated Press fact-check story cited remarks by Tester where he said Dodd-Frank is causing smaller banks to close and that they are being swallowed up by bigger banks.

The Associated Press found that no banks in Montana had closed but were bought out by other bank as banks have consolidated and merged, and that most of the banks in Montana that were merged with other banks were bought by other Montana-based banks, most community banks themselves.

Tester Wednesday stood by his remarks.

He said that even if banks have not closed, onerous regulations have made it harder for banks to remain in business. Tester said that similar trends have happened in the fields of agriculture and energy.

"My point is that when you get a bank that buys out another bank, a smaller bank, the potential for that bank closing goes way, way up, because when the banks merge, the model changes., leadership changes, you lose control within that locality that changes," he said.

He said that even when those community banks do remain open they do not reflect the communities they serve, and in rural areas larger banks such as Citibank and Goldman Sachs are unlikely to provide service tailored to the needs of these communities.

Taking up the budget

Tester said that the Senate was preparing to take up a $1.3 Trillion omnibus bill that will fund the government through the end of September.

The bill had not been made public at the time of the press call, but Tester said from what he heard it did include several priorities that would benefit Montana.

One of those includes Operation Stone Garden grants for counties in Montana near the northern border including Blaine and Hill counties, he said.

"That is all good, because if we are going to have a secure border and maximize our manpower, the synergy between customs and border protection, county government. Montana Highway patrol, municipal police departments is very, very important," Tester said.

Operation Stonegarden grants are awarded by the Department of Homeland Security to local law enforcement agencies to increase coordination and cooperation among local, county, state and federal law enforcement in policing the border.

It was too early to know how much each county would receive, Dave Kuntz, a spokesperson for Tester said in an email, but Montana received a total of $877,630 in Operation Stonegarden grants in 2016 including $63,370 for Blaine County and $68,000 for Hill County.