NEVADA STATE BANK
September 17, 2004
Mr. Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th Street, NW
Washington, DC
Re: RIN #3064-AC50
Dear Mr. Feldman:
My bank, Nevada State Bank, is over $3 billion in assets so the
proposal to raise the threshold for the streamlined CRA small bank
examination to the $1 billion level, if adopted, will have no impact on
us. However, I am a product of three small community banks, having
joined the last one when it was only $100 million in assets and helped
it grow to over $1 billion before being acquired by Nevada State Bank. I
am a former OCC employee, having spent fifteen years in the field as a
national bank examiner followed by five years in Washington as a Deputy
Comptroller.
With this background I strongly support the increase in the
threshold. From my regulatory background perspective, I see how the
investment criteria of CRA is not especially valid when applied to small
institutions in that they frequently have difficulty in finding
investments originating in and benefiting their communities. From my
community banker view, I know the disagreement I have with those who say
the cost savings are not significant. That opinion clearly emanates from
those who aren’t competing in an extremely competitive marketplace
dominated by immense banks with their incredible human and financial
resources, credit unions who have the unfair tax-advantaged position and
DO NOT themselves comply with CRA and non-bank lenders who have no CRA
obligations.
And to those who say that this increase will allow banks to “back
away from their community development obligations” I would simply
counter that my Father was president of a small bank in Texas for many
years and he taught me the value of contributing to the community, and
in those days, CRA wasn’t even a glimmer in the eye of congress. He just
did it because he recognized that bankers historically have always taken
a leadership role in community involvement, support and development. I
think he viewed it as an unwritten obligation that came with the job. I
realize that this cannot be said as true for all bankers today but I
would certainly venture the guess that for the great majority of
institutions you would see little change in the level of commitment they
exhibit today. It would just largely occur with lessened regulatory
burden and cost
We all recognize how difficult it is to reverse or moderate any law
and the level of thoughtfulness, and courage, it takes to even broach
such an action. Thank you to the FDIC, and especially to Chairman
Powell, for your rational thought process that results in giving
consideration to changing a law that, when applied on a near
across-the-board basis, is inequitable for smaller institutions.
Sincerely,
William E. Martin
Chairman, President and CEO
