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FDIC Federal Register Citations

 
FIRST BANK & TRUST CO.

Federal Deposit Insurance Corporation
Robert E. Feldman, Executive Secretary
Attn: Comments
550 17th Street, NW
Washington, DC 20429

12 CFR Part 345
RIN 3064-AC50

I am writing in response to the notice of proposed rulemaking of the CRA, which includes an amendment to reduce the regulatory burden consistent with the current definition of a “large institution” by increasing the definition of a “small institution” to that being an institution with total assets of under $500 million. Our institution has $267 million in total assets as of December 31, 2003. We reached $250 million in total assets in September of 2001. Under current definitions, we are now a CRA “large institution”. Our main office is in Duncan, Oklahoma and we have several other banking centers in Healdton, Ardmore, and Norman, Oklahoma as well.

Being surrounded by larger statewide banks in all of our markets such as BancFirst ($2.7 billion); Arvest Bank ($7 billion); and Local Oklahoma Bank ($2.9 billion) we feel the proposed move from $250 million to $500 million does not adequately provide relief to the banks caught in the small to large bank transition. A threshold increase to $1 billion would be more adequate. Banks under $1 billion are generally struggling due to manpower and opportunities in their assessment areas to perform the tasks required of the CRA. The overly burdensome reporting requirements are overwhelming for a smaller bank that does not have the budget or personnel to comply. Additionally, finding opportunities for community development lending, investments, or services is quite a task when competing with billion dollar banks that if there are not opportunities available then they have the funds to create opportunities of their own.

If a bank intends to grow into a billion + dollar bank then it will have the opportunity to meet the large bank test and at that time will be on a level playing field. However, for banks that are under one billion in assets and are stable and in a non-growth environment, it is unjust to expect them to be measured and pitted against billion + dollar institutions.

I commend the regulatory agencies to consider this change to the CRA and I understand that they must weigh comments from financial institutions against those from community organizations who are against the proposed changes. However, financial institutions have been closely scrutinized and highly regulated in regards to the abusive lending practices which the CRA was set forth to regulate. The abuses that the CRA attempts to discourage might actually be more prevalent today in non-bank institutions such as credit unions and finance or insurance companies that have in recent years expanded to include a much larger base of customers and offering very traditional loan products. These non-bank institutions are making every effort to meet the credit needs of the very same communities in which our financial institution operates and can therefore assuage consumers into borrowing with them and not being subject to such regulations as the CRA they can operate under any such credit terms as they see appropriate.

This financial institution has received three previous “outstanding” CRA ratings and we are preparing for our first large bank examination in 2005. We have always had a strong commitment to fulfill the requirements of the CRA and have taken it very seriously. This will not change even if the threshold changes and we move back into small bank status. We will continue to provide services and assistance throughout our assessment areas, provide innovative and flexible credit programs, and give back to all areas of our communities through investments and donations.

Thank you for the opportunity to comment on this notice of proposed rulemaking. Should you have any questions, please contact me at 580-255-1810.

Sincerely,

Shannon Contreras
CRA Administrator
First Bank & Trust Co.
P.O. Box 580
Duncan, OK 73534
580-255-1810
580-255-3329 Fax


Last Updated 03/25/2004 regs@fdic.gov

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