From Memphis to Mountain City, the Tennessee Bankers Association has represented the banks of the Volunteer State for more than 100 years. Jim Rieniets knows the value of representing each bank in the TBA as he embarks on his term as TBA chairman. Among Rieniets’ priorities are increasing financial literacy across the state, recruiting dynamic talent to the industry and, perhaps most importantly, making sure that the TBA continues its effort to maintain strong government relations. Rieniets took a break from his role as president and CEO of INSBANK to sit down and discuss his vision for the TBA and his expertise in government relations and share a message.
Setting the Stage
Whether it’s the future of fintech, creating a level playing field or protecting banks from regulatory overreach, TBA represents the interests of member banks to state government, as well as to federal legislative and regulatory bodies. With previous experience as the American Bankers Association’s government relations chair, Rieniets knows the importance of representing those interests correctly and the impact it can have on everyday banking customers.
“At the end of the day, when bankers talk about things that are hurting the banks, ultimately what they’re talking about are things that make it more difficult to serve customers in terms of access to products and services,” Rieniets said. “When working with lawmakers, I always encourage bankers to do what they can to frame these issues in terms of the impact on customers and taxpayers.”
Even though they happened in California and New York, the recent closures of Silicon Valley Bank and Signature Bank have affected some of the conversations with lawmakers in recent months. Addressing those issues and the challenges that are in the near term is at the top of Rieniets’ to-do list as he begins his term as chair. One issue that has his attention is something that was implemented more than a decade ago but is having effects on today’s banks.
“Small-business data collection was one of the last pieces of the Dodd-Frank legislation that’s being implemented by the Consumer Financial Protection Bureau (CFPB),” he said, “and most banks are very concerned about some of the unintended consequences of that.”
Some of those consequences include the restriction of lending to small businesses and concerns around fair lending tests.
“I think, as chair, I want to make sure I’m providing good balance and leadership on topics both near and far,” he added.
If I Ruled the World
Rieniets isn’t someone who enjoys shouting into the void or complaining just to complain. He has several nationwide initiatives that he would implement if he were in charge, including some that are already taking place in the Volunteer State. We asked him what he would change if he had the power to “rule the banking world.”
One of the first things that Rieniets would love to address is the current deposit insurance system.
As he put it, “If we agree that deposit insurance is still one of the foundations of the banking system, then $250,000 is woefully inadequate for so many business enterprises as it doesn’t cover payroll for the majority of businesses in this country.”
And Rieniets has a point. The banking system’s deposits are now three times the size of what they were when deposit insurance was increased from $100,000 to $250,000. A common theme in many of his ideas is simple: Maintain the integrity of a level playing field.
“We’ve talked about the situation of banks that are too big to fail and how that disproportionately affects smaller banks. That’s not the only issue on the ‘level playing field’ spectrum. You’ve got issues in regard to the farm credit system and credit unions expanding beyond their original mission.”
Rieniets does have a cautious optimism about Washington, though. With so many important voices clamoring for change, it may be a matter of when, not if, those changes are implemented.
“It feels as though we’re slowly starting to build consensus in Washington around the very real need to create more trust and confidence in the system with reformed deposit insurance. I’m cautiously optimistic that we’ll make some headway there in the near term and the long term.”
Another one of his first orders of business would be to bring people back into the office. While there is obvious appeal to working from home, some of the “water cooler” conversations about new regulations or deposit trends can get lost.
“It does make me wonder whether, if the regulators at the San Francisco Fed had been working in the office the last couple of years, would that have affected their ability to do their jobs? Would there have been a few more water cooler conversations among themselves about what they’re seeing at Silicon Valley Bank?”
While much of the banking climate comes from the national level, one thing that has Rieniets optimistic is Tennessee’s continued growth as a leader in the banking industry. The fiscal responsibility, tax policies and advocacy by groups like the TBA have created a healthy recipe for banks in the state. That recipe has led businesses and citizens to flock to the Volunteer State in large numbers over the last decade.
Teaching a Man To Fish
While Rieniets shared some problems at an institutional level, he also shared how many solutions can be done at the individual level.
Evoking the age-old adage about “if you teach a man to fish,” Rieniets believes that having a more financially literate society will serve in the best interests of everyone (including banks).
“To the extent that people in this country grow up learning and knowing more about how personal finance works, they’re less likely to be victims of abuse and are in a better position to be able to make decisions on day-to-day matters of finance.”
Sitting on the Tennessee Financial Literacy Commission board and leading up INSBANK’s own financial literacy programs, Rieniets has dedicated a lot of time to this issue.
One thing that he’s done at INSBANK is look at the issue from both sides of the age spectrum. On one end, the bank has had discussions with local senior living facilities about some of the issues and signs of financial elder abuse, which is only becoming more and more common with an aging population. On the other end, the bank has partnered with the Horizons program at The University School of Nashville. Through the program, INSBANK has been able to welcome students from low-income neighborhoods to the bank to explain how the bank works and share best practices on finances.
“If it were up to me, we’d have financial literacy as a core part of the curriculum at every school, and it would become a subject that is addressed along the way in elementary, middle and high school education programs.”
Looking Ahead
As president and CEO, it’s imperative for Rieniets to keep his eye toward the future and see what’s coming.
For INSBANK, that means continued growth in Nashville, as well as the niche health care markets that they have become experts in. It also means being a good corporate citizen and engaging with the community it serves through bank initiatives like its dedicated philanthropy fund.
For Rieniets personally, he is looking forward to his next golf outing, his next screenwriting venture for the bank and, perhaps most importantly, his next Sunday afternoon, when you can find him smoking barbecue and sipping whiskey.
For the Tennessee Bankers Association, Rieniets is looking forward to working with all of the member organizations to help tackle the issues facing our banks. “If you love this industry as I do, I think one important thing that we should be paying attention to is making sure we’re doing everything we can to invest in the future of this industry. And when I say investing in the future of the industry, it’s around developing and mentoring younger bankers and building that talent within the industry.
