Meet the community bankers who ran for office

Rep. French Hill (R-Ark.), Rep. Earl L. “Buddy” Carter (R-Ga.), Rep. David Kustoff (R-Tenn.).
Illustrations: Ryan Olbrysh

As we cast our votes in the midterm elections, three former community bankers who are now members of Congress tell us why they took their skills to Washington, D.C.—and how their former colleagues (you!) can make the biggest impact on policy.

By Kelly Pike

When Rep. David Kustoff (R-Tenn.) is questioning witnesses testifying before the House Financial Services Committee, he’ll often consider the testimony through the lens of community banking. He probes to uncover whether the action under discussion will hurt or help community banks.

It’s not an exercise in hypotheticals. Kustoff was once a community banker, serving on the board of $288 million-asset BankTennessee in Collierville, Tenn., from 2010 until he was sworn into the U.S House of Representatives in 2017.

“Now I’m dealing with flying at 30,000 feet on so many of these issues,” says Kustoff about addressing topics like regulatory burden and cybersecurity as a member of Congress, compared with his days as a community bank director. “It was interesting and fascinating to be on the ground dealing with them from a practical aspect.”

Kustoff is one of at least five former community bankers currently serving in the House of Representatives, including Rep. Earl L. “Buddy” Carter (R-Ga.), Rep. French Hill (R-Ark.), Rep. Neal Dunn (R-Fla.) and Rep. Roger Marshall (R-Kan.).

Independent Banker spoke with three of these members to learn more about why they ran for office and how their community banking experience affects their role as legislators.

From intern to director

Kustoff began his career as a banking intern at First Tennessee Bank (part of First Horizon National Corp.) in Memphis, Tenn., as part of a four-year training program. He spent his college summers and winter breaks working in different areas of the bank, from the teller line to the back office. In the end, he chose law school over a career in banking, but the subject always intrigued him.

When offered the opportunity to join the board of BankTennessee, he was excited to be part of a well-run bank that served the needs of the people of west Tennessee. Yet he was surprised to see how the bank had been penalized by the financial crisis, especially the regulatory burden generated by Dodd-Frank.

“I saw firsthand how you can have a good bank, a well-run bank, a well-capitalized bank, and have to devote a tremendous amount of resources … to try and comply with the multitude of regulations.”
—Rep. David Kustoff (R-Tenn.)

“I saw firsthand how you can have a good bank, a well-run bank, a well-capitalized bank, and have to devote a tremendous amount of resources, both in terms of manpower and financial resources, to try and comply with the multitude of regulations,” Kustoff says. “You’re making sure you did all the things you need to do for customers while complying with burdensome and onerous regulations.”

Hill has a similar outlook on regulation. The current majority whip of the House Financial Services Committee founded $435 million-asset Delta Trust & Bank in Parkdale, Ark., in 1999. He served as its CEO and chairman until Simmons First Bank acquired it in 2014. The bank had a strategic niche in wealth management and trust administration, with deposit accounts in all 50 states and $1 billion in trust and investment accounts in about 35 states, Hill says.

Like Kustoff, Hill spent summers and winter breaks in college working for a community bank, $300 million-asset Old Commercial Bank in Little Rock, Ark. He returned to the bank in 1993 when it was $3 billion-asset, publicly traded First Commercial Corporation. He spent the next six years as a member of the executive management team, helping grow the bank to $8 billion in assets before it was sold to Regions Bank in 1998.

“It was a very exciting, great six years of growing a community bank,” says Hill. “It was a neat turn of history to live away for 18 years and move back to my hometown and go back to the company that gave me a great education in community banking.”

Hill believes his practical experience adds knowledge and common sense to debates about issues like safety and soundness, IT, money laundering and BSA compliance, among others.

“If it is so costly and difficult to form a new financial institution or investment advisory, then you’re going to hurt the overall economy and concentrate wealth into fewer hands.”
—Rep. French Hill (R-Ark.)

“It’s not a political exercise,” says Hill. “It’s taking objectives—safety and soundness—and making sure we achieve those goals while encouraging capital to flow into those businesses and not overly burden the ability of the entrepreneur wanting to enter business. … If it is so costly and difficult to form a new financial institution or investment advisory, then you’re going to hurt the overall economy and concentrate wealth into fewer hands.”

Carter, in Georgia’s 1st district, was a director at $435 million-asset The Coastal Bank in Savannah, Ga. (now Ameris Bank), between 2010 and 2014. He joined the board as a pharmacist and owner of three pharmacies. He was also a bank customer.

“Community banks play such a vital role in the life of small businesses, and I wanted to be a part of it,” he says.
Like Kustoff, one of the most eye-opening parts of being a bank director was discovering how many resources were dedicated to compliance, Carter says.

“The last couple of years, the bank board’s only hires were in compliance,” says Carter. “We didn’t have room to hire a lender. We were concentrating on compliance so much.”

It’s this kind of experience that helps community-bankers-turned-legislators like Hill think through legislation. “That real practical experience I had working in the banking industry helps me know whether it works or whether it doesn’t work in terms of pending legislation,” Hill says.

The road to the House

Carter followed a traditional path to Congress, beginning with the Pooler, Ga., city council in 1994 and moving on to mayor, state legislator and finally the Georgia State Senate in 2010. He successfully made a run for the U.S. House in 2014 and is currently in his second term.

The banking and small-business insights strengthened by his time on The Coastal Bank’s board help him when banking bills come up.

“When a [community bank] lobbying group comes into the office, it’s a short meeting, because they know I know what’s going on and, for the most part, have been in agreement with them.”
—Rep. Earl L. “Buddy” Carter (R-Ga.)

“When a [community bank] lobbying group comes into the office, it’s a short meeting, because they know I know what’s going on and, in the most part, have been in agreement with them,” says Carter.

Hill’s career has alternated between public and private service. He began volunteering on political campaigns as a sixth grader and found himself working for Senate Banking Committee staff under Sen. John Tower (R-Texas) in his 20s for two years during President Ronald Reagan’s first term.

He then entered the private equity and venture capital sector, where he spent more than five years of his career, only to become deputy assistant secretary of the Treasury for Corporate Finance from 1989 to 1991 during the George H.W. Bush administration. He was named special assistant to the president and executive secretary to the Economic Policy Council in 1991.

Hill was planning to run for state legislature in 2013 while continuing his career as a community banker when his district’s House seat opened up. “I went back to my board and senior management team to say that this was just a completely different decision,” says Hill, whose dad helped found and invest in a community bank in the late 1950s. “It required a little work on our part as a group at the company, since I’d leave if I ran for Congress.”

ICBA Grassroots Action Center

Not sure where to begin or what to say when meeting with members of Congress?

The ICBA Grassroots Action Center offers tools to help you communicate with legislators and regulators, whether it’s by phone, in a letter or in person. From talking points and advocacy training to advice on how to invite your legislator to your community bank, it has everything you need to take action.

Visit icba.org/beheard to get started.

Kustoff saw a similar opportunity when Rep. Stephen Fincher (R-Tenn.) decided not to run for reelection. Kustoff and his wife felt his leadership experience could help him make a strong contribution.

The lawmakers are optimistic about legislation favorable to community banks. “I think [community bankers] should be reasonably hopeful, especially if the makeup of Congress is similar to what it is now,” says Carter.

Kustoff predicts the Financial Services Committee will be aggressive over the remaining months of the term and is hoping to deal with pressing issues, including housing reform and cybersecurity.

Hill is hopeful the Senate will pick up the JOBS and Investor Confidence Act (JOBS Act 3.0), a bipartisan package of 32 bills to tailor the regulatory burden while preserving safety and soundness. He also sees Congress continuing to work with the Treasury Department and new regulatory agency officials to improve regulation, balancing safety and soundness with economic growth. That includes pushing back against Treasury’s beneficial ownership rule that took effect May 11, which he believes is costly.

Bird’s-eye view

While Hill finds public service challenging and gratifying, there are things he misses about community banking, especially private-sector measurements of success. “I miss being in business from a teamwork aspect, having common goals of diversifying and expanding a business to make a profit, rewarding employees for outstanding work and delivering great customer service,” he says.

Yet he still sees evidence of his community banking work when he drives around his district and notes subdivisions, businesses and commercial developments his bank helped finance. “There is a sense of accomplishment in our free-market capital system and how important our financial institutions are to helping Americans to achieve their dreams,” Hill says.

Kustoff has a similar outlook. “I realize that being a community banker in this day and age is so much tougher than it was 10, 15 or 20 years ago,” he says. “It is important to reach out to the members of Congress so that we understand the whole playing field.”

What your legislators really want to hear

Does grassroots lobbying really make a difference? How can you best communicate with your elected officials and their key staff? Three former community bankers offer useful pointers for communicating effectively with their peers on Capitol Hill.

Rep. French Hill (R-Ark.)
French Hill believes it’s important for both regulators and legislators to hear directly from customers and employees living under laws and regulations so they understand the real-world impact.

“Host roundtables of employees for elected officials to talk about the costs and benefits of regulatory and legislative proposals based on bank size and sophistication,” he says. “Those are very effective. Host roundtables of customers to talk about capital access and the compliance burden that’s passed on to customers by financial institutions at the request of the federal government. … Regulators ought to have regular exposure to the impact of their decisions out in their districts.”

Rep. Buddy Carter (R-Ga.)
Buddy Carter encourages community bankers to take advantage of recesses, when legislators are in their home districts, so they can see for themselves what your bank does.

“The most important thing is to be engaged, particularly during the month of August. Invite members of Congress to the office. Let them see what you do and the value you bring to help people,” he says. “Make sure they know who you are and what you do. It’s so very important to build up a relationship with the congressperson themselves or with different people who work in the office. Sometimes it’s a sheet of paper just to jot a note or to send an email.”

Rep. David Kustoff (R-Tenn.)
Even legislators with community banking backgrounds welcome and can benefit from meetings with community bankers, says David Kustoff. These conversations help legislators understand the nuances of how a bill could affect the institution.

“When I meet with a community banker and he or she explains something, I may be seeing it from three different vantage points, but I need to be looking at it from a fourth vantage point. … I may be considering something that I think is helpful and it may not be enough, or it may be too much,” Kustoff says. “I want to make sure we talked a fair amount about practicality, that proposed legislation really will work and is effective in real-world settings.”


Kelly Pike is a freelance writer in Virginia.

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