Federal Deposit
Insurance Corporation

September 16, 2004

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

Re: Community Reinvestment, RIN number 2064-AC50

Dear Mr. Feldman:

As a community banker I applaud and support the FDIC's proposal to increase the asset size limit of banks eligible for the streamlined small bank CRA examination process. I believe that the level should be raised to $2 Billion or the exam process completely eliminated (one could hope).

There is much unnecessary paperwork that does, not follow the original intent of a law that was enacted because of a few bad banks. As you are aware the law originated in 1977 and states that banks must lend to the. community, which they serve including low to moderate-income areas. Because this regulation has become a political tool for special interest groups, the exam process and business process have become onerous and in some cases jeopardizes business strategies.

NorthSide Community Bank has been open for 7 years and we fall into the category of the large bank exam. We need to review the exam procedures to make sure they match the law. To examine a community bank for "qualified investments" as these choices are difficult to find and may not be appropriate. Lending and investments test should not make community investments. ineligible for CRA credit because they include the entire community, not exclusively benefit low to moderate-income individuals?

The cost of compliance is large and passes through many areas of the bank. Investing in our communities is just good for business and it does not take investments tests to understand the process. Is the penalty for non-compliance appropriate when there is so much subjective process to the review? Is it appropriate for business decisions to be subject to the voice of any special interest group? The banking industry has taken on many roles as the gatekeeper, BSA, OFAC, TIN Compliance and CIP to name a few. It would be a great relief financially and strategically if our regulators and congressman would recognize the burden and take appropriate action to correct a mis-applied regulation and exam procedures.

Sincerely,
Patricia A. Clausen
President/CDO
NorthSide Community Bank
Gurnee, IL