تاثیر پیشدستی قانون وام دهی منصفانه گرجستان توسط OCC بر بانک های ملی و دولتی و سیستم بانکی دوگانه

The Comptroller of the Currency (OCC) recently preempted anti-predatory lending statutes in Georgia and other states. This study investigates preemption's impact on the wealth and risk of national and state banks. Wealth increased significantly only for small, geographically diversified national banks. Preemption did not significantly reduce state bank wealth and insignificant differences in excess returns are found when similar national and state banks are compared. Small bank systematic risk rose in the post-event period but the cause is unclear. The evidence suggests that preemption did not create a significant competitive advantage for national banks endangering the dual banking system.

In the dual banking system in the United States commercial bankers can choose between either a national or state charter at any time. This decision determines which of the set of competing agencies supervise the bank as well as permissible activities, applicable regulations and supervisory costs.1 The Office of the Comptroller of the Currency (OCC) supervises banks that opt for a national charter. All other banks are jointly supervised by their chartering state and either the Federal Reserve or FDIC. Charter-related differences have generally narrowed over time, but two potentially important ones remain. National banks pay higher explicit supervisory costs than state banks do, all else equal.2 They also need not comply with state laws that are preempted by the OCC using statutory authority granted to the agency by the National Bank Act.3 Preemption actions are controversial because they may give national banks a cost or revenue advantage relative to state chartered peers which could ultimately increase the fraction of industry assets controlled by national banks and supervised by the OCC.4 The OCC's 2003 decision to preempt the Georgia Fair Lending Act (GFLA), one of many recently enacted state anti-predatory lending laws, followed by its subsequent adoption of a final rule in 2004 preempting any state law regulating the terms of credit provided by national banks have been particularly contentious. The agency and its critics have disagreed sharply about the impact of these decisions on the performance of national and state banks. Critics of the OCC assert that these actions created a significant competitive advantage for national banks, particularly for large organizations. To buttress their claim they point to the subsequent significant increase in the share of banking assets controlled by national banks which they view as signally the demise of dual banking system.5 The OCC contends that smaller national banks, especially those operating in multiple states with anti-predatory lending laws, face the heaviest compliance burden and so should be most likely to benefit from preemption. Although most of the discussion about the effects of the OCC's recent preemption decisions has focused on potential effects on bank costs and profitability, they could influence bank risk as well. Currently, there is no empirical evidence on any of these issues and so the debate about preemption's effects on national and state banks remains unresolved. This study investigates the effects of the OCC's recent preemption decisions on the wealth and risk of national and state banking companies using an event study approach. The impact of four related events are explored beginning with the OCC's initial announcement that it would consider preempting the GFLA in early 2003 and ending with the release of its decision that it would preempt similar state laws in early 2004. The sample consists of 131 bank holding companies that have been separated into a number of different portfolios based on their predominant charter type, size, and the geographic location of their mortgage lending activity. Briefly, significant wealth increases are found only for small, geographically diversified national banks. Preemption did not significantly reduce state bank wealth and insignificant differences in excess returns are found when similar national and state banks are compared. Systematic risk rose for all small banks in the post-event period but this change may not be the result of preemption. The evidence suggests that preemption did not create a significant competitive advantage for national banks that could endanger the dual banking system. The remainder of the paper is organized as follows. Section 2 contains background information on the features of state anti-predatory lending laws, and a discussion of how the preemption of these laws might influence bank costs and risks. The chosen event dates, sample selection, and the model used are described in Section 3. The main empirical results are presented in Section 4. A summary and conclusions follow.

The analysis of the excess returns reveals that the OCC's four recent preemption announcements had only a modest impact on the expected performance of national and state banks. The evidence does not show that preemption created a significant competitive advantage for every national bank. Large national banks appear to receive minimal benefits from preemption. Recent decisions by two large NBD holding companies to sell off their subprime lending operations and the withdrawal of a national bank charter application by another represent anecdotal evidence consistent with this view.49 A significant wealth increase was found only for the portfolio of small, geographically diversified national banks. This performance improvement indicates preemption reduced the relatively high costs for these banks attributable to their greater compliance burden and lack of scale. When the wealth changes at national banks and state banks are compared controlling for size and geographic diversification, no significant differences are found. In short, the analysis of the wealth effects associated with the preemption announcements does not support the view that these preemption decisions are likely to endanger the dual banking system. There is some evidence indicating that the systematic risk of smaller national and state companies was higher in the post-event period. The increases in risk don’t appear to vary with bank charter, and are probably related to the volatile interest rate movements that occurred during the event period.