Washington, D.C. – Congressman Andy Barr (KY-06) proposed the ‘‘Promoting Access to Capital in Underbanked Communities Act of 2020,” to spur economic investment in rural communities in Kentucky by easing regulations that hinder bank formation. This proposal requires federal banking regulators to jointly issue rules to allow new banks up to three years to meet capital requirements otherwise applicable. It would also streamline existing banking regulations to promote banking services in underserved rural areas.
Bank closures and consolidations have negatively affected access to capital for small businesses, families and individuals throughout Kentucky and the U.S. Recently, a study conducted by the Federal Reserve identified 44 counties “deeply affected” by these trends. As of 2012, these counties only had 10 or fewer bank branches and by 2017 had lost at least 50% of these bank branches. Nicholas County, Kentucky in the Sixth District is one of those deeply affected counties.
“Our pro-growth economic tax, regulatory and trade policies have helped power a great economic recovery since the COVID-19 pandemic began in the U.S.,” said Congressman Barr. “That being said, we still have work to do. Access to capital is critical to sustained economic growth, prosperity and success in any community. This proposal will incentivize the formation of new community banks in underserved areas.”
“I thank Congressman Barr for his continued support for small community banks and the areas they serve,” said Corey Craig, President and Chief Executive Officer of Citizens Bank in Mount Vernon and Chairman of the Bluegrass Community Bankers Association. “This bill would expand access to capital in rural areas and help promote financial inclusion for underbanked Kentuckians.”