As concerns intensify over government intervention and bad publicity, some Arizona banks are rejecting federal funds just months after applying for them.
West Valley Bancorp.,
At the urging of regulators, WVB filed the rather simple two-page funding application in November, with the goal of expanding its Small Business Administration program or acquiring another bank.
“Over the course of the last few months, we have become more and more concerned about the expansion of government into the free markets,” said Candace Wiest, president and CEO of
“If you ask the bankers who accepted the funds in the first few rounds, most of them will tell you the rules change frequently,” she said.
WVB turned down about $800,000.
In late February,
In November, Tulsa, Okla.-based BOK Financial became one of the largest commercial banks in the country to decline TARP funds.
Federal regulators told bank officials their application would be viewed favorably and invited them to participate in the program.
“Our company took a hard look at the opportunity, but ultimately determined the additional funds were unnecessary, since our current capital levels are well above the government requirements,” said Dave Ralston, chairman and CEO of Bank of Arizona, a BOK subsidiary.
Many bankers are not happy with TARP, viewing it as a necessary evil –– which may be why small, healthy banks are shunning the program after initially applying for funds.
“The tax increases needed to fund these bailouts are going to impact a large majority of working Americans. Many of them feel the banks caused this mess,” said Wiest, who also serves as a director of the Federal Reserve Bank of
She believes Wall Street firms caused the financial meltdown, and she said the government should regulate these “too big to fail” institutions the same way commercial banks are regulated.
“Once a business is called too big to fail, the people who run such businesses begin to believe they can do anything with any risk, and they will be saved,” Wiest said. “Plus, any time the government is in the business of picking winners and losers, it is a bad idea.”
Get Connected
West Valley National Bank: www.wvnb.com
BOK Financial Corp: www.bokf.com