Western Commerce Bank
September 16, 2004
Robert E. Feldman, Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
E-mail: comments@fdic.gov.
RE: Community Reinvestment, RIN number 3064-AC50; Proposal to Expand
Eligibility for the Streamline CRA Exam
Dear Mr. Feldman:
As a community
banker, I support the FDIC’s proposal to increase
the asset size limit of banks to $500,000,000 for CRA Examinations.
We have always strived to provide loan and deposit products for all
income levels of customers, along with being a leader in government
programs for small businesses and farm and ranch loans. Our loan
to deposit ratio’s for the past 20 plus years has exceeded
75%, with the average in New Mexico around 55%. These are areas that
should be considered, as you can verify that banks are supporting
their community.
Western Commerce Bank had received Outstanding CRA Ratings until
we were moved to the large bank category in 2001. This was very disappointing
to our Board, President, Officers and employees. Our asset size was
only $257,000,000 and since then has averaged between $251M and $257M,
which is not a large bank. The examiner for our November 2002 CRA
Exam advised us that we should be spending approximately $85,000
in donations for low and moderate area organizations. We are located
in Carlsbad, Loving, Hobbs, Lovington, Tatum, NM with one location
in Albuquerque. In all of the small towns we are in there is only
one designated moderate-income area in Hobbs, although Albuquerque
does have both low and moderate areas. This makes it hard for us
to find investments that would qualify for the Investment test, as
well. Living and working in rural communities we try to be involved
in local activities to support our areas, but they do not qualify
as low to moderate income area activities.
We strive to
receive an Outstanding CRA Rating, therefore we invested in a $3,000,000
CRA
Qualified Investment Fund with CRA Fund Advisors.
This was to show the examiners we want to comply by investing in
development programs for low and moderate income areas. The CRA Fund
Advisors, who are nationwide, could only locate a Freddie Mac Pool
A26091 that has $293,200 in mortgage loans located in Albuquerque
that are in the low and moderate-income areas. Not only that, but
the value of the Pool has been running below market. Our External
Auditor and CPA required us to “Mark It To Market” each
quarter resulting a reduction in capital of whatever the unrealized
loss was for the end of quarter. But our President and Directors
feel that we should participate in this program to help with our
CRA Rating.
These are just a few topics that I wanted to share with you in regard
to what rural community banks are challenged with. I strongly recommend
the move from $250 million to $500 million in CRA Examinations to
help release the regulatory burden on small banks. This will allow
the smaller bank to concentrate on truly helping their community
and by working with them hands on, through loan programs and local
community activities. We take our CRA evaluation seriously and in
the past have used our record keeping activities to show our commitment
to our communities.
Thank you for your consideration,
Brenda K. Suggs
Vice President and Compliance Officer
Western Commerce Bank
PO Box 1358
Carlsbad, NM 88221-1358
bsuggs@wcb.net
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