People everywhere are talking about the new movie “The Big Short,” which looks at our country’s most recent financial crisis and the sub-prime mortgage lending that caused it. An outstanding op-ed entitled “Community banks aren’t to blame for sins of big banks, Wall Street in ‘The Big Short,’” written by David Littlewood, president of TFNB Your Bank for Life in McGregor, TX, recently ran in the Waco Tribune.
Littlewood aims to make perfectly clear that the big banks and bankers portrayed in the film share no similarities with community bankers. He begins by saying, “Let’s start by differentiating between the big banks and bankers such as those portrayed in the film and the community banks that are, unfortunately, being lumped into the same category.” While community banks are dedicated to the growth and success of their customers, these too-big-to-fail banks and Wall Street firms literally “played craps with the American and global economy for personal gain.” In an eerily timely development further validating Littlewood’s points, news of Goldman Sachs’ $5 billion settlement related to mortgage securitizations was announced on the same day this op-ed was published.
He goes on to discuss the loan model used by community banks – one vastly different than the model used by the big banks in the film – in which loans are typically held and serviced for the life of loan by the originating bank. If mistakes are made and losses are incurred, the community bank – and only the community bank, not the American people – suffers the consequences. He concludes by saying, “Not all bankers are bad, greedy or unscrupulous. Community bankers know their success lies in the success of the people and small businesses they help and the communities they serve. I hope people get all sides of the story – and realize the popular idea that all bankers are evil just ain’t so.”
Staff contact: Steve Scurlock, firstname.lastname@example.org, 512-275-2226