A New Haven provider of financial compliance software said community banks across the country had to spend more money to comply with more regulations and enforcement actions in 2013.
Continuity Control, which compiles a banking compliance index, said a 22 percent increase in regulatory changes and a 5 percent increase in enforcement actions required the average community bank to hire the equivalent of more than two full-time compliance employees at a cost of $150,000 during the year.
Community banks, which Continuity defines as having $10 billion or less in total assets, have complained that the regulations created to rein in risky activity at the largest banks are hurting smaller banks.
The Independent Community Bankers of America, an industry association representing mainly banks with $500 million or less in assets, is lobbying Congress to exempt them from a provision of the Volcker Rule that was issued in December.
The provision requires all banks to divest their holdings of trust-preferred securities backed by collateralized debt obligations. Community banks argue that the rule could force them to take an impairment of their investments.
