Merrill W. Sherman, president and CEO of Bancorp Rhode Island Inc., has something new to add to her resume: member of the Community Depository Institutions Advisory Council, or the CDIAC. She was one of 12 New England bank executives to let the Federal Reserve Bank of Boston know their opinions on certain policies and issues. Sherman joins Washington Trust’s Joseph MarcAurele and Rockland Trust’s Christopher Oddleifson on the advisory board. She answered five questions about it.
PBN: How did you get selected for the advisory council? Is it something you sought? Were you nominated? Or did they call you one day and say, “Would you like to be on it?
SHERMAN: There was an open call for nominations. I expressed an interest in serving on the council, and the Federal Reserve Bank of Boston indicated that the selection committee believed that I would represent not only BankRI but also bring the perspective of similar commercial banks in the state and region.
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PBN: What types of things were discussed at the CDIAC’s first meeting on March 1? I had read somewhere that interchange fees came up.
SHERMAN: The first meeting was a lively well-rounded discussion that focused primarily on the economic conditions and loan demand from businesses and consumers throughout the region. These meetings give the Federal Reserve a chance to talk and listen to community banks. They have numerous feet on the street and can provide real-time input about what businesses and consumers are thinking and feeling. Interchange fees were a part of the conversation, but the dialogue was far more wide-ranging with respect to both economic and regulatory matters.
PBN: Do you think that community banks didn’t have a strong enough voice with the Federal Reserve Bank before? And if so, will the advisory council really change that?
SHERMAN: Having not participated before I cannot answer that question. I do believe the advisory council is a highly constructive listening device that can only help amplify the views of community banks and their customers. Eric Rosengren, president and CEO of the Federal Reserve Bank of Boston was incredibly focused, responsive and knowledgeable, so it is easy to believe that the viewpoints around the table were heard and will be relayed to Washington.
PBN: Do you have any issues or concerns that you’d like to raise at the future CDIAC meeting?
SHERMAN: I am concerned about the increased regulatory burdens and the compliance costs that community institutions face and how those ultimately will impact our customers.
PBN: The CDIACs are a requirement of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. What other provisions of the act, if any, will aid community banks?
SHERMAN: I understand why this legislation was written – people were rightfully outraged at things like subprime lending – but it remains to be seen if this act will be successful in getting at the root causes of the financial crisis. I do not believe anything in the act will be helpful for community banks.
