Washington, DC – Yesterday, the House Financial Services Committee held its semi-annual Humphrey-Hawkins hearing, featuring testimony from Federal Reserve Chairman Ben Bernanke.  Under the Humphrey-Hawkins Act of 1973, the Chairman of the Federal Reserve is required to present to Congress a report twice a year outlining the state of the U.S. economy.  The Chairman uses these hearings to publicly state the strengths and weaknesses of the economy and to answer questions from committee members. 

Below are excerpts from Congressman Frank Lucas’ conversation with Chairman Bernanke.  The entire video is available at /videos. 

CONGRESSMAN FRANK LUCAS:
“Chairman Bernanke, most of the focus on the credit crisis has centered on the nation’s largest banks and biggest businesses, but there is a whole segment of the financial industry that has not received that much attention.  And that’s rural America, where literally hundreds of thousands of farms, ranches, and small businesses are located out in the countryside in small towns, small cities and communities.  While the major banks have a presence in rural America…it’s the small independent community banks who are the center of credit availability in most of these communities.  Would you touch for a moment on the health of and the status of these institutions?  Are they suffering some of the same problems as the major facilities?”

CHAIRMAN BEN BERNANKE:
“We have always valued the contribution that they [small banks] make.  What the small bank does, what the community bank does is it has the local contacts the local information and builds the local relationships that allow it to make loans that a large bank may not be able to make and to support small business and agriculture and other activities.  So we think the small banks and community banks are critical our system.  We are very happy that they are there and we believe they will continue to be important to the system.”

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