FDIC Federal Register Citations

March 4, 2002

Robert E. Feldman
Executive Secretary
Attention: Comments/OES
Federal Deposit Insurance Corporation
550 - 17th Street, N.W.
Washington, D.C. 20429

Re: Policy Statement Regarding Minority-Owned Depository Institutions

Dear Mr. Feldman:

Mutual Community Savings Bank (Mutual Community), located in Durham, North Carolina, is pleased to comment on the proposed policy statement issued by the Federal Deposit Insurance Corporation (the "FDIC") regarding minority-owned depository institutions.

For your information, Mutual Community was chartered in 1921 to represent the African-American community. Mutual Community currently has $74 million in assets and has two branches.

Mutual Community supports America's Community Bankers' (ACB) position as provided in the attached letter. However, Mutual Community would like to comment specifically on two questions.

Mutual Community believes the definition of a minority-owned depository institution should be updated to reflect the following change: "minority means any African American, Native American, Hispanic America or Asian American."

Mutual Community recommends that minority status should not be based solely on ownership or control by U.S. citizens and legal residents. This measure may work well for stock or privately-held companies, but not for mutually organized institutions such as Mutual Community. Rather, we believe that consideration should be given to a multi-step test:

(1) 51% ownership by a minority person; and/or
(2) minority-owned as defined by Section 308(b) of FIRREA; and/or
(3) majority of the board of directors, account holders, and the community which the institution serves are minority.

Mutual Community believes a process of self-certification is sufficient, subject to verification upon examination. Such a process will minimize unintended regulatory burden and facilitate the statutory mandate.

Mutual Community appreciates this opportunity to comment on the proposed Policy Statement, and will assist the FDIC in any way possible to preserve and promote minority ownership of depository institutions. Thank you for the opportunity to comment on this important matter.

Sincerely,
William Smith
President & CEO