BANK OF IDAHO
June 29, 2004
Robert E. Feldman
Executive Secretary
Attention: Comments
Federal Deposit Insurance Corporation
550 17th Street, N.W.
Washington, DC 20429
Dear Mr. Feldman:
The Bank of Idaho has reviewed the newly published Interagency Guidance
on Overdraft Protection Programs, published in Volume 69, Number 109 of the
Federal Register on June 7, 2004. The Bank of Idaho was pleased to see that
the majority of the requirements and best practices are already being
followed in financial institutions utilizing the IMPACT Overdraft Privilege
Service.
There are a few areas which we believe are worth of comment.
Charge Off Overdrafts at 30 Days:
Our collection process is designed to minimize losses while focusing on
customer retention. This process is designed to make systematic contact with
the customers and determine which customers wish to cure their negative
balance and which are deserving of being charged off. This process has been
used for quite some time and we believe that it efficiently manages risk.
The Bank of Idaho would advocate that overdrafts be allowed up to an aging
of sixty (60) days prior to charging off an overdraft but in no event less
than forty-five (45) days as credit union regulations currently require.
Repayment Plans:
The guidelines suggest that repayment arrangements which are formalized
between a depositor and a bank should be charged off when the underlying
overdraft has aged past thirty (30) days. The Bank of Idaho has experienced
a high degree of success in utilizing repayment plans and find that they
provide an additional safety net for the customers.
These repayment arrangements also produce a small degree of risk during
the period in which they are being paid according to their terms.
Accordingly, the Bank of Idaho would suggest that current and performing
repayment plans not be charged off.
Thank you for your consideration.
Jeffrey E. Jones
Executive Vice President
Bank of Idaho
151 N. Ridge, Suite 240
Idaho Falls, ID