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FDIC Federal Register Citations



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FDIC Federal Register Citations

Virginia Bankers Association

From: Robert Chapman [mailto:rchapman@bankofthejames.com]
Sent: Tuesday, October 05, 2004 12:10 PM
To: Comments
Cc: wayers@vabankers.org
Subject: RIN #- 3064-AC50 Community Reinvestment Act (CRA)

Mr.. Robert E. Feldman, Executive Secretary
Attention: Comments/Legal ESS
FDIC
550 17th Street, NW
Washington, DC


Dear Mr.. Feldman:

I hope this letter finds you in good health and good spirits. I am writing on behalf of the Virginia Bankers Association on the FDIC's proposed changes to its CRA regulation. We applaud the FDIC's proposal to raise the definition of "small bank", for purposes of determining those banks eligible for the streamlined examination standards, from $250 million in assets to $1 billion in assets regardless of holding company affiliation. We believe the arguments in support of such a change are compelling, and urge the FDIC to finalize its proposal at the earliest possible time.

We stress that community banks in Virginia, many of which are state non-member banks, are under enormous regulatory strain. New requirements under the USA Patriot Act and in particular the Sarbannes-Oxley Act have pushed the overall burden on such banks to a new high. This burden hits us particularly hard as we do not have the resources available to address compliance that the large banks have. In light of this compliance burden, we believe the FDIC should remain ever vigilant in reducing the burden whenever it can. CRA is an area where the FDIC can, and should, reduce the burden on small banks.

Let me also say that our bank by the very nature of our business lends to all segments of the communities we serve. CRA loans are an important part of our business and we seek such loans. Raising the threshold to $1 billion will not reduce CRA loans; it will reduce unnecessary and costly red tape thereby allowing us to remain competitive.

Finally. we note that increasing the threshold to $1 billion will not impact the vast majority of bank assets, which, because they are held by large institutions, will still be subject to the full CRA examination process. But it will relieve smaller institutions of unnecessary and, we believe, inappropriate regulations. Again, the cost of compliance for institutions just above the current threshold is disproportionately high relative to institutions above the threshold. The FDIC is right to address this by increasing the threshold to $1 billion.

In summary, we commend the FDIC for pursuing the right course on this issue. Making CRA easier for us in the community bank world will ease compliance burdens and allow us to more effectively compete in the marketplace. We appreciate the opportunity to comment.

Sincerely,

Robert R. Chapman, III
President & CEO
Bank of the James
Lynchburg, Virginia


 

Last Updated 10/08/2004 regs@fdic.gov

Last Updated: August 4, 2024