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FDIC Federal Register Citations

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)

Last Updated 09/13/2004 regs@fdic.gov

Last Updated: August 4, 2024