From: Phil Menhusen [mailto:pmenhusen@stateexchange.net]
Sent: Monday, April 11, 2005 12:39 PM
To: Kilber, Kenyon T.
Subject: FIL-22-2005

Dear Mr. Kilber:

RE: FIL-22-2005

Thank you for the opportunity to comment on the proposed "Classification of Commercial Credit Exposures".

We object to this proposal because it replaces a practical, easily understood methodology with one that is complex and obscure. This might be justified if the result would be a system that more accurately assessed risk, but our review of your proposal indicates that the result would be more subject to judgment and interpretation that the present system.

Bankers are still stunned by your huge blunder in replacing the simple and effective 1%,15%, 50%,100% method for reserve for bad debt allocation with what can only be described as the most obscure regulation in history. We encourage you to learn from your mistake, and not discard the time-tested substandard/doubtful/loss method with a system that is more complicated and less effective.

Thank you for your consideration.

Sincerely,

Phil Menhusen
Executive Vice President
State Exchange Bank
PO Box 284
Mankato, KS 66956