LITTLE ROCK, Ark. — The incoming American Bankers Association chair, Cathy Owen, has identified a number of issues she has identified as priorities during her term, including pressure on community banks from nonbank financial firms, but did not identify credit unions as among those threats during a recent interview.
Owen also warned that stablecoin legislation could divert deposits from banks and pledged to continue pushing for regulatory relief during her term leading the nation’s largest banking trade group.
In a question-and-answer interview published by Arkansas Business, Owen, who also serves as president and CEO of State Holding Co. and Eagle Bank & Trust, said one of the industry’s greatest concerns is the possibility that nonbanks could operate under a different set of rules than federally regulated financial institutions.
A Demand That Will Sound Familiar
In a comment that will sound familiar to credit unions, Owen said banks welcome competition but argued that nonbank providers should be subject to the same consumer protection and safety standards as traditional financial institutions.
She specifically pointed to pending stablecoin legislation, saying allowing cryptocurrency companies to offer interest-like rewards on stablecoins without the protections provided by Federal Deposit Insurance Corporation insurance could encourage consumers to move deposits away from banks.
According to Owen, such a shift would reduce funding available for community banks to make loans that support local businesses and economic development.
Challenges From Fraud
Fraud also remains a significant challenge, she said, adding that banks cannot combat the problem alone.
Much like the credit union trade groups, which have joined the bank trade groups in joint letters, Owen said the ABA is urging the Federal Communications Commission to strengthen telecommunications rules to make it more difficult for fraudsters to impersonate financial institutions through phone calls and text messages. She also voiced support for the proposed Scam Act, legislation intended to hold social media companies more accountable for fraudulent activity conducted through their platforms.
Growth Projections
On bank growth, Owen told Arkansas Business that sustainable expansion should balance profitability with sound risk management rather than focus solely on increasing assets.
She said annual deposit growth of 3% to 6% and loan growth of 4% to 7% are typical for many institutions, while stronger growth generally falls in the 7% to 12%-plus range for deposits and 8% to 15%-plus for loans. However, she said smart growth also requires careful attention to capital, liquidity and overall risk.
Looking ahead to her tenure as ABA chair, Owen said regulatory modernization will remain one of her top priorities.
She said the association plans to continue advocating for what it views as a better-balanced regulatory framework that would allow banks to direct more resources toward lending and serving their communities.
House Chair Knows the Issue
Owen credited French Hill, chairman of the House Financial Services Committee and a former banker in Arkansas, with helping advance legislative efforts aimed at reducing regulatory burdens on community banks. She also praised federal banking regulators for revising several proposed rules that she said would have made it more difficult for community banks to operate.
In addition to policy advocacy, Owen said she hopes to encourage more bankers to engage with lawmakers and policymakers.
And in another observation that will sound familiar to credit unions, Owen told the publication, “If we don’t tell our story, someone else will do it for us.”
Five Decades in Banking
According to Arkansas Business, Owen recently marked her 52nd year in banking. She began her career as a summer “shred clerk” and has since held nearly every position at the institution. She helped establish the bank’s holding company and led the acquisition of a failing community bank that was later merged into Eagle Bank & Trust. Owen previously chaired the Arkansas Bankers Association and serves on the Conference of State Bank Supervisors Bank Advisory Board.
