FDIC Federal Register Citations

Premier Bank


From: Gail Mcbride
Sent: Tuesday, August 24, 2004 1:11 PM
To: Comments
Subject: Community Reinvestment -- RIN 3064-AC50

Community banks are put at a competitive disadvantage since non-banks and credit unions are not subject to the same CRA requirements. The small bank threshold should be raised from $250 million to $1 billion. As a community banker, I greatly welcome the regulators' effort on raising the threshold. The community banking industry is slowly being crushed under the cumulative weight of regulatory burden, something that must be addressed by Congress and the regulatory agencies before it is too late. This is especially true for CRA, though well intentioned, unnecessarily increases costs for community banks that are passed on to consumers.

I also support the recommendation to change the definition of “community development” to benefit not just low- and moderate-income residents but also residents of rural areas. However, I do not support the FDIC proposal that adds a new community development criterion to the small bank examination for banks between $250 million and $1 billion: consideration of the bank’s community development lending, services and investments. In small community banks bankers many times perform more then one role at the institution, and by adding the community development criterion to the small bank examination it adds a time consuming accumulation of additional data on the compliance function similar to the large bank CRA examination. The data collection and analysis that must be done for the large bank CRA examination almost always requires an institution to purchase additional costly software such CRA Wiz and hire additional employees. Once again, adding the community development criterion stretches already limited resources at community banks and provides no urgently needed relief to institutions sized between $250 million and $1 billion.

Please help community banks to continue to be contributors to their local communities in order to help their communities flourish. Community banks are in a better position than the multi-regionals and the big national banks to do that since we are from our communities and understand its needs. Please do not let community banks drown in regulatory red-tape.

Gail McBride
Senior Vice President
Premier Bank