| FIRST BANK OF TENNESSEE
7-16-04
Federal Deposit Insurance Corporation
Robert E. Feldman, Executive Secretary
Attention: Comments, FDIC
550 17th Street NW
Washington, DC 20429
Reference: Comments on Overdraft Protection Dear Mr. Feldman:
Marketing and communication with customers is very important to First
Bank of Tennessee. Overdraft Protection is a product that our customers
demand. Before we offered this product, we had customers that refused to
open a checking account with our bank because we did not provide
overdraft protection. These customers had moved into our area from other
cities that had provided them with this service.
Our bank does not mislead our customers as to the true cost of this
service. We provide disclosures at account opening and our customer
representatives are vigilant in describing all aspects of this product
to them at that time. Our staff explains the product features and offers
other choices that are available to them. The customer makes the final
choice of which product they prefer. Our customers request this service
since it prevents having to pay an overdraft fee at both the bank and
the merchant, should they have a check with non-sufficient funds
presented for payment. It also spares them undue embarrassment at these
establishments.
Our overdraft program prominently distinguishes actual balances from
overdraft protection funds available. Overdraft amounts are not
reflected in our ATM balance inquiries. We also notify customers by
notice the day the overdraft program is accessed. We do not charge an
interest fee in addition to the overdraft charge. A flat fee is charged
each time the service is triggered and an overdraft is paid — this fee
is the same amount that would be charged even if the overdraft item were
not paid. There is no additional interest or other fees charged.
First Bank of Tennessee does not target low-income consumers —
virtually all consumer checking accounts are eligible for this service
if the customer meets the bank's criteria for this product. First Bank
of Tennessee is a community bank that strives to serve our customer base
fairly — not take advantage of them in any way.
Thank you for the opportunity to respond to the agency's concerns.
Doris M. Waldo
Sr. VP Operations
First Bank of Tennessee
420 Third Avenue
Dayton, TN 37321
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