Federal Deposit
Insurance Corporation

September 13, 2004

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

Re: Community Reinvestment, RIN Number 3064-AC50
Proposal to Expand Eligibility for the Streamlined CRA Exam

Dear Mr. Feldman:

I want to express my concern about the potential defeat of the FDIC's proposal to increase the asset size limit of banks eligible for the streamlined small-bank CRA examination. First Financial Bank is a community bank. We have given strong support to our community for over 80 years -- long before it was mandated! I also want to convey to you my strong support for the elimination of the separate holding company qualification.

Almost all of the "marketing" dollars that we spend are on community activities that promote education, development, financial resources, and. healthcare to the under-privileged people and communities within our market. Every employee is encouraged to participate by donating their time to organizations that promote economic development within our community and help those in need. The FDIC's proposal will not deter us from finding ways to promote a healthy community. It will, however, lessen the examination burden and the unnecessary paperwork that is required to comply. I can assure you it will not alter our determination to continue to, make a difference in our community.

The time spent on excessive paperwork is. wasted. I offer this one example, although we have many others. One employee spends thirty-percent of her time tracking loan, investment and employee volunteer time to validate that we comply with our CRA requirements. This same'employee is one of the individuals in our organization that mentors low-income families. Her goal is to assist them in becoming financially fit to promote home ownership. She is also active at a local low-income housing development helping to qualify potential homeowners for loans. If her time were reallocated, she could spend more time in our community actually helping people rather than creating paperwork.

Please consider the fact that streamlining the CRA exam does not mean that we will be exempted from complying with CRA. It is merely a more cost effective and efficient CRA examination process. Banks with considerable more assets have considerable more resources. It is not logical to evaluate a $500 million bank in the same manner as you do a $500 billion bank.

One of the biggest issues is the definition of a qualified investment. We do not have the resources or expertise to launch an investment program of our own. As a result, we are forced to participate in regional or statewide programs. While the funds are going toward a worthwhile cause, it detracts from the resources that are so desperately heeded in our own community. We would like the opportunity to reinvest our shareholder's dollars to help and support the people in our local community.

The FDIC's proposal is advantageous because it continues to focus on community development, but it considers investment, lending, and services. It would let community banks pursue community development activities that both meet the local community's needs and make sense in light of the bank's strategic strengths.

Chester County, while very affluent, still has a large rural population. We are frequently called upon to support needed economic or infrastructure development such as school construction, revitalizing Main Street, or loans that help create needed or better-paying jobs. These activities should not be ineligible for CRA credit because they do not benefit only low- or moderate-income individuals.

We are supporting this change to alleviate regulatory burden. By easing regulatory burden, it will make it easier for community banks like mine to continue to provide committed service to local communities that few other financial service providers are willing to do. We see it as our obligation and our reason for staying independent. We need your support to help us with our mission.

Thank you for taking the time from your busy schedule to consider my opinion.

Sincerely,
Donna M. Coughey