a part of the Dodd-Frank financial reform law that requires banks to collect demographic data on small business loan applicants.
The section is intended to allow regulators to make sure banks aren't discriminating against minorities or women who are looking for capital for their businesses. That's already against the law. Similar data is already kept on mortgage applicants.
But Pittenger, a Charlotte Republican, said the additional requirement is burdensome, unnecessary, and that the government should not be in the business of dictating to banks who they should lend to.
"Let’s get back to the basics and let bankers be bankers," he said. "Frankly, the only issue that banks ought to be involved in is if somebody is creditworthy."
The portion of Dodd-Frank known as Section 1071 was cited by bank executives as an area of concern not long after the law was passed in 2010. They've argued that banks would lose the flexibility to structure commercial loans in the most reasonable way, in an effort to avoid the appearance of favoring one borrower over another. While mortgages are more or less a commodity, bankers say business loans can vary dramatically from one to the other.
Supporters of the provision, like current U.S. Sen. Elizabeth Warren, say it's an important tool to monitor fair lending practices.
Pittenger said the bill is not intended to take away from fair lending oversight, but he denied that discrimination in loans is a problem. He said existing laws are already sufficient to make sure it's not happening.
He also said the provision would lead regulators to pressure banks to lend to people who aren't creditworthy.
"The government shouldn't be involved in forcing a social agenda on lending institutions," he said. "That’s how we got in that mess to begin with, we were loaning money to people that weren't creditworthy."
Pittenger is in his first term in Congress, representing south Charlotte, west and north Mecklenburg County and parts of Union and Iredell counties in a seat formerly held by Sue Myrick.
Pittenger serves on the House Financial Services Committee, and has been involved in the committee's hearings related to changing the Federal Housing Administration. He's also been vocally against the Dodd-Frank law and has called for ratcheting back "oppressive" bank regulations.
He served on the board of Charlotte-based Park Meridian Bank before it was acquired by Regions Financial in 2001. Pittenger said he's heard from a number of community banks worried about this provision in Dodd-Frank.