6 JAY JENKINS VISIT OUR WEBSITE AT: NMBANKERS.COM PRESIDENT’S MESSAGE Advocates for a state-owned bank have been completely unrealistic and have overlooked the massive challenges in establishing such an entity. PRESIDENT NEW MEXICO BANKERS ASSOCIATION This will be my final President’s Message as I complete my second tour of duty as NMBA President. I was honored to be asked to complete Lonnie Talbert’s term. As you probably know, Lonnie has recently been named CEO of the ATM Industry Association. After a very successful 2022 Legislature, during which we defeated HB 75 (StateOwned Bank Authorization), I continue to be concerned that the state-owned bank issue is raised session after session. So, I decided to get ahead of the curve and prepare an op-ed to be provided to all news outlets concerning our position on this matter. So, the remainder of my message is my op-ed. I hope that it hits the mark. Please don’t hesitate to share your feedback. STATE BANK OP-ED In recent legislative sessions, a recurring topic has been the establishment of a state-owned bank in New Mexico. Advocates for a state-owned bank have been completely unrealistic and have overlooked the massive challenges in establishing such an entity. Perhaps the most salient point in opposition to would be the significant financial commitment from the state to have the state bank become well-capitalized. As a result, New Mexico taxpayer dollars would be at risk because a state-owned bank would not have deposit insurance such as FDIC insurance. Nor would the state bank be subject to extensive federal and state regulations and examination oversight, which is necessary for protecting depositors and preserving the safety and soundness of a bank. Given these facts, it is particularly important to weigh any potential cost-savings from not paying bank fees against the potential expense of operating a state bank. Accordingly, the transition to a state-owned bank has the potential to be very costly to taxpayers due to unintended consequences. Any state-backed institution, even if operated by good-faith actors, is
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