Sent: Tuesday, November 04, 2008 9:47 AM
Subject: TEMP LIQ PROGRAM
I am extremely
concerned about parameters of the Loan Guarantee program and the unintended
consequence that it may have on the Overnight Fed Funds Market. We did
not have any unsecured debt on the books as of 9/30/08 and we would not
qualify for the guarantee. This guarantee may cause the correspondent
banks to only complete FF Purchase for those banks that have this
guarantee. As it stand today 2 of our 6 correspondent banks have pulled the
overnight lines. The bank has no choice but to Opt out of this piece due
the fact that we did not have an unsecured line, however, if the fund is not
large enough to absorb the losses under the proposed rule all banks would
share in the costs.
extraordinary times and the efforts by the FDIC are greatly appreciated.
The change in deposit coverage was a huge positive for community banks.