Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, April 8, 1993 TAG: 9304080099
SECTION: BUSINESS PAGE: B10 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
REGULATOR TO URGE LENDING
Eugene A. Ludwig, the Clinton administration's regulator of the nation's largest banks, said Wednesday he is taking his anti-credit crunch message on the road.Ludwig, sworn in Monday as comptroller of the currency, told reporters he will visit every one of his agency's districts to urge battle-scarred examiners to adopt a more balanced approach to evaluating the riskiness of banks' loan portfolios.
Next week he'll be in Dallas; the week after that, in New York.
"If it takes weeks, not days, I have to do that. You can't get locked in . . . to the prison of the [Washington] beltway," he said.
Ludwig, a Washington attorney who attended Oxford University with President Clinton, said the new president has made stimulating bank lending a key part of his plan to revive the economy.
In the field meetings, Ludwig said, he will focus on the administration's program to stimulate small-business lending.
The plan eases some paperwork rules in an effort to encourage more character loans - loans that take into account borrowers' reputations in addition to their financial strength.
Ludwig said the wave of bank and savings institution failures since the mid-1980s has caused some examiners to believe the safest decision is the most conservative decision - regardless of the effect on lending and the economy generally.
"I'll be talking to as many people as I can, top to bottom" to change that attitude, he said.
Some consumer groups have expressed concern about the administration's initiative, warning that a return to regulatory laxity could cause a repeat of the S&L crisis.
However, Ludwig said he would be urging a balanced - not a lax - approach to evaluating banks' safety.
"This is not examiner-bashing," he said.
"It's not that we're going to be opening the gates and the [loan] money is going to be gushing out.
"But also, we're not going to say, `Oh, oh. We've had trouble. Better shut down the [loan] window."
Ludwig's office, an arm of the Treasury Department, regulates 3,600 nationally chartered banks, including most of the nation's largest.
He is the first, and so far only, Clinton appointment to a financial regulatory position.