WASHINGTON-House Financial Services Committee Member Jim Ryun (R-Kan.) introduced The Community Banks Serving Their Communities First Act (H.R. 2061) May 3, which provides regulatory and tax relief to community banks. The legislation, spurred by the Independent Community Bankers of America, provides relief in a wide variety of areas, including allowing adjustment of intervals between examinations for qualified banks up to $1 billion; provide exemptions from internal control and attestation requirements under Sarbanes-Oxley for banks up to $5 billion in assets; exempt banks that do not share customer information from the annual privacy notice unless there has been a policy change; allow a 20% tax credit for Subchapter C banks and bank holding companies, as well as Subchapter S banks on 20% of distributable income, with limits; and provide qualified community banks and bank holding companies in distressed areas with a 50% tax credit with caps; and exempt agricultural real estate and mortgage loan income from taxation in community of under 2,500, among many other items. ICBA President and CEO Camden R. Fine noted, "Community banks today compete on an uneven playing field, and their customers are paying the price for it. This legislation is a small but important step towards closing the tax and regulatory gap with tax-exempt and lightly regulated credit unions and farm credit agencies." "Our members are excited about this proposal because it will benefit consumers, small businesses, local governments and others who depend on community banks for financial support," ICBA Chairman David E. Hayes, president of Security Bank in Dyersburg, Tenn., said. "By lifting the yoke of regulatory burden off their backs, and moving them closer to tax parity with tax-exempt credit unions, community banks can focus their resources on better serving their customers." -

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