Originally published in the Tennessee Bar Association - December 1, 2012.

Coming soon may be an answer to this question.

Ask any banker what she thinks of Basel III, and then prepare yourself for a tirade. Ask Greg Gonzales, the Commissioner of the Tennessee Department of Financial Institutions, and he’ll be more dignified in his criticism, but he won’t disagree that Basel III is a bad idea. Ask the Conference of State Bank Supervisors (CSBS), the professional association for the heads of the state banking agencies, and it will say that “…we are opposed to the proposed approach put forth by the federal banking agencies to implement the Basel III capital accord and to incorporate a standardized approach for risk-weighted assets.”

What’s “Basel III” and Why Is Everyone So Upset?

Basel, Switzerland, is the site of the Bank for International Settlements (BIS). The Basel Committee on Banking Supervision, whose Secretariat is located at the BIS, provides a forum for discussions and cooperation on banking supervisory matters. The stated objective of the Basel Committee is to enhance understanding of key supervisory issues and improve the quality of banking supervision worldwide. Committee members exchange information on national supervisory issues and make recommendations about how to achieve a common, international understanding about supervisory standards, including international standards on capital adequacy. Committee members come from all across the globe, from Argentina to Luxembourg, from India to the United Kingdom. And the United States. However: the CEO of the Sevier County Bank is not on the committee. Neither is Commissioner Greg Gonzales, who is also chairman of CSBS. Community banks are not at the table at the most important and potentially destructive policy-making confab in recent financial services history.