ITASCA BANK & TRUST CO.
From: DoloresLittle@itascabank.com [mailto:DoloresLittle@itascabank.com]
Sent: Friday, September 10, 2004 3:39 PM
To: Comments
Subject: CRA Proposal Comment Letter
Itasca Bank & Trust Co.
308 W. Irving Park Road
Itasca, IL. 60143
September 10, 2004
Robert E. Feldman, Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th Street, NW
Washington, DC 20429
Re: Community Reinvestment Act (CRA) Proposal
Dear Sir:
Our bank, Itasca Bank & Trust Co., would like to submit this comment
letter in support of the FDIC’s recent CRA proposal. We believe that the
best action would be to increase the asset size of banks eligible for
the small bank streamlined CRA examination from $250 million to $1
billion with no community development criterion.
Our bank has approximately $355 million in assets, with one location
in Itasca, Illinois. Since the opening of our bank over 55 years ago,
our philosophy has been to be a business leader and to act in the best
interest of our community. We believe our success is directly related to
our support and involvement in our community. I am the Compliance
Officer and also currently serve as the CRA Officer, Privacy Officer,
Business Continuity Coordinator and liaison to all auditors. As with so
many community banks, many officers in our bank handle numerous roles.
The proposal, if approved, would greatly reduce our regulatory burden
under the CRA. We are located in DuPage County, which has a high median
family income (2004 was $69,600) and average home values above $150,000.
We are not located in a rural community. We have had great difficultly
in finding opportunities that meet the definition of community
development loans, investments and services. We do not have the
expertise or capacity to become involved in complex community
development projects like equity investments, even if we could find
opportunities. We do not have the budget to employ a full-time community
development officer as many banks over $1 billion in assets do.
Including a community development criterion for banks in our asset size
would continue the existing problem we have meeting the current large
bank CRA requirements.
Our data processor does not have the capability to accurately collect
information on renewed loans electronically and this results in our bank
using a manual process for collecting CRA data on small business loans.
This process involves time of each loan officer and a number of
supporting staff positions. Keeping staff trained on the complex
reporting rules also
requires an investment of time and money. Cost savings would be realized
by our bank from the elimination of the small business data collection
and reporting requirements.
Subjecting a $350 million bank to the same examination as a $100
billion bank is not reasonable. The regulatory burden on smaller banks
has grown significantly larger, including in the last few years with the
USA Patriot Act and the Gramm-Leach-Bliley Act. Even if the size
eligibility for the small-bank CRA examination does rise to $1 billion,
it will not decrease
our CRA responsibilities or the impact our banking activities in our
community. The change will eliminate some of the most burdensome CRA
requirements.
In summary, we believe that increasing the asset-size of banks
eligible for the small bank streamlined CRA examination process to $1
billion is an important step that will impact us by reducing our
regulatory burden without negatively impacting the community we serve.
We do not agree that the addition of a community development criterion
or a separate community development test for banks with assets of $250
million to $1 billion would be beneficial. We would continue to have
difficulty maintaining staff and resources to find qualified community
development loan, investment or service opportunities.
Sincerely,
Dolores Little
Vice President/ Compliance Officer
Itasca Bank & Trust Co.
(630) 773-0350
(630) 775-9719 (fax)
