NEW YORK ( TheStreet) -- In news that would make anyone who follows finance do a double-take, Barney Frank is now on the board of a bank. And he might not have made it there without the unintentional help of Pope John Paul II more than 30 years ago.
The former U.S. House member and co-author of a sweeping financial reform bill that bears his name, the Dodd-Frank Wall Street Reform and Consumer Protection Act, was elected Wednesday to the board of New York-based Signature Bank (SBNY). Frank previously represented Massachusetts' 4th Congressional district for 32 years, serving from 2007 to 2011 as Financial Services Committee chair, a role in which he helped craft a temporary $550 billion rescue plan during the financial crisis.
Frank will be filling a board seat previously held by Alfred B. DelBello, a former New York lieutenant governor, who died in May. He attended his first board meeting on Wednesday and looks forward to being on the other side of the table, where he can see his legislation in action.
"It gives me a chance to repudiate some of the caricatures that if you're a liberal and believe that credit-default swaps ought to be regulated that that somehow makes you an enemy of banking," Frank said in an interview on Thursday. "I have always thought that the intermediary role banks play is an essential one when done right, and I'm glad to have a chance to work with an institution that does that."
Signature Bank is a state-chartered company founded in 2001. It holds $28.6 billion in assets and focuses on meeting the financial needs of small, privately owned businesses. As such, it is not yet part of the Federal Reserve System; its primary regulator is the state of New York. Frank acknowledged that at some point the bank may approach the $50 billion threshold that, under current regulations, would make it a systemically important financial institution (SIFI) and subject it to greater regulation. Frank has stated previously that he believes that threshold may be too low.
"There's another advantage from my standpoint -- not that there would have been a conflict in any case," Frank noted, "but it is a bank which has less than most banks' involvement with the federal regulators I worked with."
Signature's board has one face that is familiar to Frank. He will be working alongside former-U.S. Sen. Alfonse D'Amato, a New York Republican who served on the Senate Banking Committee. In fact, it was D'Amato who first spoke to Frank about joining Signature's board.
"We had a very good relationship," Frank said of his time in Washington DC with D'Amato. "We shared an interest in multi-family housing." The two worked closely to draft legislation to create incentives for landlords in low-income areas to maintain low rents -- and prevent evictions -- as a previous measure was set to expire.
That work complements Signature's strategy of taking advantage of the Low Income Housing Tax Credit, which Frank counts as "one of the great untold success stories in America." Under the program, banks are awarded tax credits which they can either use themselves or sell to developers for the production of affordable housing.
As an advocate of finance reform, Frank was pleased with the acknowledgment of its importance in an encyclical from Pope Francis, published in English on Thursday, that largely focused on climate change. It's "the second-nicest thing a Pope has done for me," he said.
The nicest, he says, was freeing a Congressional seat so that he could run for it: When Pope John Paul II demanded in 1980 that all priests withdraw from politics, Robert Drinan, a Congressman and Jesuit priest, chose not to seek re-election and Frank won his seat.
Drinan reportedly later said he regretted never meeting the Pope so that he could ask, "You know that business with getting me to leave Congress? Did that turn out the way you planned?" Frank, who recounted his experiences as openly gay Congressman in a memoir published in March, can't imagine that he was the Pope's idea of a perfect replacement.
As for his feelings about banking, Frank says, "I've always enjoyed working with banks that are in the basic business of lending people money so they can do good things."
Now, Frank can see how it works firsthand.