NATIONAL
EXCHANGE BANK & TRUST
September
7, 2004
Public Information Room
Office of the Comptroller of the Currency
250 E Street, SW
Mailstop 1-5
Washington DC 20219
RE: Docket #04-17
Dear Sir/Madam:
We appreciate the opportunity
to comment on the regulatory proposal referenced above, specifically
relating to the “Changes Resulting
From Revisions to the Board’s Regulation C”.
The very last paragraph under the above reference item states:
We do not anticipate that loans counted as both “small business/small
farm loans” and “home mortgage loans” will be so
numerous as to affect the typical institution’s CRA rating.
In the event that an institution reports a significant number or
amount of loans as both home mortgage and small business or farm
loans, examiners will consider that overlap in evaluating the institution’s
performance.
My questions are as follows:
1. How will the examiners know that there has been a significant
number or amount being reported?
2. If you do not anticipate many of these loans, why were we required
to report in this manner and what purpose is it serving?
An example of a high percentage in double reporting would be farm
loans, with real estate as collateral. The real estate is farm land,
with a 1-4 dwelling (homestead) included on it. Not many farm loans
today are being secured without real estate as collateral.
Please refer back to my original comment letter dated April 19,
2004 (docket #04-05) regarding the double reporting and the false
information that will be created, as well has the added burden of
re-coding information on our systems for the new reporting requirements.
Feel free to contact me should you have any questions.
Sincerely,
Kathleen A. Humke
Vice President / Compliance
NATIONAL
EXCHANGE BANK & TRUST
April 19, 2004
Public Information Room
Office of the Comptroller of the Currency
250 E Street, SW
Mailstop 1-5
Washington DC 20219
RE: Docket #04-05
Dear Sir/Madam:
We appreciate the opportunity to comment on the regulatory proposal
referenced above, specifically relating to HMDA and CRA reporting.
The purpose for
HMDA was to help determine whether financial institutions are serving
the “housing” needs
of their communities. With this purpose in mind, please explain
to me why the following
HMDA information is being interpreted as it is.
The new definition for refinancing under HMDA states that if a new
loan satisfies and replaces an existing loan; and both existing loan
and new loan are secured by a lien on a dwelling, it is HMDA reportable.
There is no more purpose test.
With this new
definition, I felt we now had the opportunity to report business
purpose loans
that are “predicated” on a 1-4
dwelling that were not previously CRA or HMDA reportable. I was than
told not only are these reportable, but also anything relating to
small business or small farm with a dwelling securing the loan in
any manner (over abundance or additional collateral) was also HMDA
reportable. Nowhere in the new amended regulation is there any reference
to double reporting of loans under HMDA or CRA?
By double reporting the following, false information will be created:
1. Under CRA the census tract is where the business is located;
2. Under HMDA the census tract is where the dwelling is located;
3. If we report according to the new HMDA refinance information given
to me, these types of loans will now have two different census tracts
(a processing nightmare) and HMDA total dollars will now have commercial
loan dollars, in residential census tract numbers.
I was also informed that regulators are to keep in mind the double
reporting when doing a CRA Evaluation. Why would that be?
Is this in fact
an error in information given out to me from the Federal Reserve
Board?
I feel the definition of “refinance” under
HMDA needs more clarification as it applies to business purpose,
not changed. CRA and HMDA are too “tied together” to
be double reporting.
Feel free to contact me should you have any questions.
Sincerely,
Kathleen A. Humke
Vice President / Compliance
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