Former Trump official has big plans for Florida's largest bank group

A year into her role running the state’s biggest lobbying, education and advocacy group for banks, Kathy Kraninger recognizes the industry is amid a deep transformation, especially considering the past decade of community bank consolidation. 

But big change, even a wide decline in the number of community banks, says Kraninger, doesn’t have to equate to surrender. “I don't want us to be Thelma and Louise driving off the cliff,” she says. “It's like no, that cliff is coming, and we all see it. So let's actually point it out, talk about (it) and redirect when we have the opportunity, rather than just driving off of it.” 

Kraninger brings that optimistic, yet realistic and transparent, style to her role as president and CEO of the Florida Bankers Association. She was named CEO of the Tallahassee-based group last fall, taking on the role Nov. 5, 2023. She replaced former CEO Alex Sanchez, who retired. Not only was replacing Sanchez a big-shoes-to-fill task — he was a prominent and vocal advocate for Florida banks and the industry — it’s also historic: Kraninger is the fourth CEO of the organization since it was founded 136 years ago, in 1888. 

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Kraninger comes to the FBA position with a background in policy, regulations and financial technology. That includes 24 years in Washington, D.C., where she was a deputy assistant director of public policy for the U.S. Department of Homeland Security; a clerk for the U.S. Senate Committee on Appropriations; and a program associate director for general government in the White House Office of Management and Budget, among other roles. 

Her most notable role in D.C. was from December 2018 to January 2021, when she oversaw the Consumer Financial Protection Bureau. Kraninger was appointed by Pres. Trump and approved after a partisan confirmation process in the U.S. Senate. In between D.C. and Tallahassee, Kraninger worked in the private sector, leading regulatory efforts for cryptocurrency security firm Solidus Labs. Her career in service started young, when soon after graduating from Marquette University she volunteered for the Peace Corps — being assigned to Ukraine from 1997 to 1999.

In a virtual interview with the Business Observer the day after Election Day, when Donald Trump had been declared the winner, Kraninger spoke about her career, philosophy on regulations in the financial industry and some goals and objectives of the FBA. Edited excerpts: 

Belt way: Kraninger resigned her position at the CFPB at the end of Trump’s presidency. She had spent 15 years in the capital, with the kind of career she dreamed about as a kid growing up in Pennsylvania. “Once you've been the director of the CFPB, there aren't really too many places left to go. So I wanted to learn more about how businesses operate, and I went to work for a startup, a software compliance company in crypto, and that gave me a whole other vantage point into financial services.” 

Sun shine: Kraninger says the excitement of the crypto company soon began to wane, though she enjoyed working with entrepreneurs — who see the world differently than government regulators. “I just got sick of traveling all over the world as a one man show. So right at the time where I was trying to figure out what I would do next, a good friend of mine told me Alex Sanchez was retiring and the Florida job was open. Did I ever see myself moving to Florida in the past? No. But I was always open for what I consider to be pretty interesting opportunities. And this is one of them.” 

Less is more: Kraninger says her approach to heading the controversial CFPB — created to oversee banks, lenders and large non-bank entities, such as credit reporting agencies and debt collection companies — was to be as hands off as possible while consistently upholding all the laws to all the entities the bureau oversaw. “I don't believe any regulator or government official should have a personal agenda or a vendetta agenda… I fundamentally believe protecting consumers is best done when you're setting clear rules for the entities that are providing consumer services,” she says. “They know what those rules are, and you hold them to them. But we have a dynamic today where too many regulators see something in the market, or they see something they want to be in the marketplace, and they drive to that outcome. As a regulator, that's not the role of government. The role of government is to set the rules and actually enable the private sector to function, to compete on a fair and level playing field, and let consumers have access to that, and let consumers make their own decisions.” 

“That is not, I think, the direction it's been going in the last four years and that’s why bankers are excited about the potential of the Trump administration.” 

Member support: One of Kraninger’s most important tasks at the FBA, she says, is to work on the narrative that bankers, despite negative national press, aren’t enemies and banks as an institution shouldn’t be vilified. “It's easy to demonize people in this day and age,” she says, countering that many community bankers are “the board members on all the nonprofit organizations. They're truly involved in what the future of our state is and what the future of our economic well being is. And so I think giving bankers a platform to highlight the great work that they do as is something that we need to be doing more of as an association, and something that's a huge priority to me because I don't think the American people realize we have fewer and fewer banks in this country, and we're going to end up having fewer and fewer banks in this country, and they need to know why that's a bad thing for them.”

Credit check: An issue the FBA has been heavily involved in for years is the ongoing debate about credit unions, specifically should nonprofit credit unions be required to pay federal axes, like banks have done for years. The FBA under Sanchez was a fierce believer in the answer being yes, that billion-dollar credit unions go way beyond mom-and-pop credit unions, and are provided an unfair advantage.

Kraninger agrees — with a softer edge. “I do feel pretty strongly that they have kind of strayed from their typical mission, and even the structure in which they're operating,” she says, noting several credit unions have been looking to increase market share in commercial banking markets. “We want a fair and level playing field in terms of competition, and so it is definitely something we're looking at.” 

Kraninger adds that credit unions, which she worked with at the CFPB and in other roles in D.C., are “an ally on 90% of the things that we care about. And so I'm cautious of that, too.”