FDIC Federal Register Citations

From: Karen Blandford [mailto:kblandford@westgov.com]
Sent: Tuesday, October 19, 2004 2:00 PM
To: Comments
Cc: Rosemary Ngwiri
Subject: RIN 3064-AC50

FDIC staff:

As a community development professional in a small city in Maryland, I am opposed - strongly - to the proposed changes in the Community Reinvestment Act (CRA).

In the past decade, I have seen the amount of investment local banks make in community projects plummet. When I first came to Westminster, every charitable event could count on the myriad of locally owned banks to contribute not only money but, equally important, manpower. Bankers were involved in the business community - not only the Chamber, but the smaller merchant groups. They were involved in the charitable community - from chairing capital fundraising committees to helping pack meals for the homebound.

Bankers used to regularly call me and meet with me for ideas on how to better serve the needs of low income people. Bank examiners regularly visited my office to see how the local banks were performing.

Now, most of our local banks have been bought out by larger institutions. No longer are local bankers active in all aspects of the community. Mortgage brokers often prey on low income families trying to buy their first house. Charities desperate for assistance often "call too late" for local banks to give.

I haven't heard from any bank examiners in years.

Although many of our local banks still give - the local hospital expansion has been generously supported, and a crew of workers from a small bank were out in the United Way's Day of Caring - the activity level is much lower. They do not need to meet their CRA obligations in our small town anymore. They can buy Low Income Housing Tax Credits in places that are much larger then we are, and the bank's obligations will be met.

I fear the change that may happen if the proposed CRA changes go through. The estimate is that 76% of the banks in my state will no longer have to invest in the low income communities from which they take deposits!

Any watering down of CRA requirements will drastically hurt small communities like ours. We would like the FDIC on our side as we strive to make a healthy community.

Thanks,

Karen Blandford
Manager, Housing and Community Development
City of Westminster, MD