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FDIC Federal Register Citations

Itasca Bank & Trust Co.

Itasca Bank & Trust Co.
308 W. Irving Park Road
Itasca, Illinois 60143

April 5, 2004

Robert E. Feldman, Executive Secretary
Attention: Comments
Federal Deposit Insurance Corporation
550 17th Street, NW
Washington, DC 20429

Re: Community Reinvestment Act Regulations

Dear Sir:

As a community banker, I strongly endorse the federal bank regulators' proposal to increase the asset size of banks eligible for the small bank streamlined Community Reinvestment Act (CRA) examination from $250 million to $500 million and elimination of the holding company size limit (currently $1 billion). This proposal will greatly reduce regulatory burden. I am the Compliance Officer of Itasca Bank & Trust Co., a bank with $335 million in assets, located in Itasca, Illinois.

Adjusting the asset size limit more accurately reflects significant changes and consolidation within the banking industry in the last 10 years. To be fair, banks should be evaluated against their peers, not banks hundreds of time their size. The proposed change recognizes that it's not right to assess the CRA performance of a $300 million bank with the same exam procedures used for a $300 billion bank. It is not fair to rate a community bank using the same CRA examination. And, while the proposed increase is a good first step, the size of banks eligible for the small-bank streamlined CRA examination should be increased to $2 billion, or at a minimum, $1 billion.

Increasing the size of banks eligible for the small-bank streamlined CRA examination does not relieve banks from CRA responsibilities. Since the survival of many community banks is closely intertwined with the success and viability of their communities, the increase will merely eliminate some of the most burdensome requirements.

In summary, I believe that increasing the asset-size of banks eligible for the small bank streamlined CRA examination process is an important first step to reducing regulatory burden. I also support eliminating the separate holding company qualification for the streamlined examination, since it places small community banks that are part of a larger holding company at a disadvantage to their peers. While community banks still must comply with the general requirements of CRA, this change will eliminate some of the most problematic and burdensome elements of the current CRA regulation from community banks that are drowning in regulatory red-tape. I also urge the agencies to seriously consider raising the size of banks eligible for the streamlined examination to $1 billion in assets to better reflect the current demographics of the banking industry.

Sincerely,

Dolores Little
Vice President/ Compliance Officer
Itasca Bank & Trust Co.
 

Last Updated 04/13/2004 regs@fdic.gov

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