Gaynor to press issues for Nevada Bankers Association

line By Richard N. Velotta LAS VEGAS SUN

It's obvious that newly elected Nevada Bankers Association President John Gaynor is respected by his peers.

The head of the association of 35 banks and savings-and-loans in the state didn't even work at a bank when he was elected to his one-year term.

But the way Gaynor looks at it, that has worked in his favor so far. Because the president and chief executive officer of Premier Commercial Bank In Organization -- soon to be known as Bank of Nevada -- doesn't have as many day-to-day responsibilities in an office, he has been able to spend a lot of time traveling during his first month in office.

Gaynor has traveled all over the state with Ted Wehking, executive vice president of the NBA, discussing issues in the banking industry with executives in rural communities.

"We want to assure our members of the open lines of communication we have," Gaynor said. "I think many members in the outlying areas have a feeling of being left out. They give their money (to the association), but then they don't hear from you."

Gaynor said he has received a warm reception in his travels around the state, but there's no particular issue relevant to rural Nevada bankers that their urban colleagues aren't concerned with. And, the issues confronting the NBA run parallel to those confronted by the American Bankers Association, based in Washington D.C.

"The thing that John really has going for him is that he been a banker in Nevada for years," Wehking said. "After working for two community banks and for some big banks, he can hardly go anywhere in the state without running into someone he knows from a past association."

Wehking said Gaynor is the most active president the NBA has had in recent years. He said in addition to renewing acquaintances on his visits, Gaynor makes a pitch for Bank PAC, the NBA's political action committee. He and Gaynor stress the importance the PAC has in making the industry's voice heard in the political arena.

While many of the issues NBA officials discuss are national in scope, Gaynor said some are relevant to state and local officials and some federal laws have local applications.

Most of the issues that will be the focus of lobbying efforts and public information campaigns are carry-overs from previous years. Gaynor said the NBA's campaigns will focus on privacy issues, deposit insurance reform, bankruptcy law reform and automatic teller machine access fees.

Gaynor said the banking industry is taking the lead on privacy issues, pressing for federal legislation that would penalize identity thieves.

Identity theft, a growing problem, occurs when a criminal gains unauthorized access to a person's personal records and information and uses it to establish credit, take on debt or access bank accounts of unsuspecting victims.

Gaynor said the banking industry is leery of the availability of information on the Internet and how it can be used illegally.

The ABA and the NBA support legislation that mandates disclosure of information that is shared with a third party and gives consumers the right to "opt out" of having information about them shared.

Privacy issues are controversial within the industry because some bankers feel they should protect a customer's privacy while at the same time develop beneficial technological advancements that could make a person's records more accessible to others.

The banking industry differs on privacy issues from Sen. Richard Bryan, D-Nev., a member of the Senate Banking Committee. Bryan wants to restrict the sharing of information; the bankers prefer a less restrictive policy that allows them to share information with affiliates like mortgage companies.

A bill allowing the sharing of information was approved by Congress last year, but Bryan continues to battle for more restrictions. The bankers want to give the current law a chance to work before changing it.

"There are reasons to share information that is not to the detriment of the customer," Gaynor said. "There's a difference between sharing financial information with an affiliate and selling a customer list to a telemarketing firm."

Bryan, who is retiring from the Senate after this session, has made privacy issues a top priority and he and Sen. Richard Shelby, R-Ala., formed the Congressional Privacy Caucus earlier this year to examine privacy issues emerging in the Internet economy.

Bryan also wrote letters to bankers in April asking them to adopt stricter policies on privacy on their own. Bryan said none of them responded to his satisfaction.

Gaynor said his association also will advocate deposit insurance reform that would double the coverage limit from $100,000 to $200,000.

The Federal Deposit Insurance Corp. bank insurance fund grew to $29.6 billion as of the end of 1999 and the Savings Association Insurance Fund reached $10.3 billion, both exceeding the mandated 1.25 percent reserve ratio, according to the ABA.

Some bankers have advocated rebating excess FDIC funds, but Gaynor said his group would push for increasing the limit of how much can be insured.

One of the concerns about adding coverage, Wehking added, is that "doubling insurance may double the regulations in place as well."

Other issues before the association are ongoing controversies.

The industry is generally united in favor of bankruptcy law reform. The ABA backs a "needs-based" bankruptcy system that would provide Chapter 7 protection from creditors only to individuals who do not have the capacity to repay a significant portion of their unsecured debts out of future income.

The ABA has joined with other small business groups to help draft bankruptcy reform legislation in Congress.

The associations have taken leadership roles in opposing legislation that would put price controls on the use of automatic teller machines. Gaynor said the bankers favor allowing the free market to dictate ATM access fees and not the government. Banking leaders say banning ATM surcharges ultimately harms consumers by reducing the number of ATMs or increasing the fees at ATMs that aren't owned by banks.

Gaynor said the NBA will continue to be on a different page when issues involving credit unions are raised. Gaynor said the industry isn't opposed to credit unions competing for banking business, but he said if they do, they should pay the same taxes banks have to pay.

He said over time, the rights of credit unions have expanded but the institutions have never been taxed. Gaynor said bankers only want credit unions to pay their share if they compete in the industry.

archive