Emprise Bank
September 9, 2004
Mr. Robert E. Feldman
Executive Secretary
Federal Deposit Insurance Corporation
550 17th Street NW
Washington, DC 20429 Re: RIN Number 3064-AC50
Attention: Comments/Legal ESS:
I would like to comment regarding the new Small Bank threshold change
proposal. I would like to see the threshold raised to a larger number
than $250MM, however I think the number should perhaps be $3BB or
even $5BB, although $1BB is a step in the right direction. Given
the enormous size of some financial institutions today, I think it
is entirely possible for a bank with $2BB or $3BB in assets to qualify
as a community bank, dedicated to serving the needs of their local
community or communities. Community banks are put at a competitive
disadvantage since non-banks and credit unions are not subject to
the same CRA requirements, without even considering the tax advantage
that credit unions possess. The community banking industry is slowly
being crushed under the cumulative weight of regulatory burden, which
is something that must be addressed by Congress and the regulatory
agencies before it is too late. This is especially true for CRA.
Although it is well intentioned and nobody argues with the importance
and necessity of being responsive to the needs of the local community,
the necessity to compile and retain data of all kinds simply to document
and prove compliance unnecessarily increases the costs for compliance.
And those added costs 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. Rural residents typically fit
the income pattern that would qualify for low-income status if they
lived in a city with defined census tracts.
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 (although I again submit that number should be much
larger). Consideration of the bank's community development lending,
services and investments should be based on an overall subjective
assessment by the examiner, after consultation with local community
sources, and should not be based on any artificial, standardized
ratios or magic numbers. Adding the community development criterion
to the small bank examination 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 and/or hire
additional employees to handle record keeping. Adding a formalistic
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 big nationwide 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.
Respectfully submitted,
Thomas A. Page
President
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