Skip to main content
U.S. flag
An official website of the United States government
Dot gov
The .gov means it’s official. 
Federal government websites often end in .gov or .mil. Before sharing sensitive information, make sure you’re on a federal government site.
Https
The site is secure. 
The https:// ensures that you are connecting to the official website and that any information you provide is encrypted and transmitted securely.
Federal Register Publications

FDIC Federal Register Citations



Home > Regulation & Examinations > Laws & Regulations > FDIC Federal Register Citations




FDIC Federal Register Citations

PEOPLES STATE BANK

From: Tami Janowicz [mailto:tamij@bankpeoples.com] On Behalf Of Janowicz, Tami
Sent: Thursday, September 16, 2004 3:00 PM
To: Comments
Subject: RIN number 3064-AC50

Mr. Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
550 17th Street, NW
Washington, DC 20429

Re: RIN Number 3064-AC50: FDIC Proposed Increase in the Threshold for the Small Bank CRA Streamlined Examination

Dear Sir:

I am the Director of Compliance and CRA for Peoples State Bank which is headquartered in Hamtramck, Michigan. Peoples State Bank is a community bank with approximate assets of $430 million. We have 10 branch offices distributed throughout three metropolitan counties in SE Michigan and include portions of each of these large counties in our assessment area.

I strongly support the FDIC proposal to raise the threshold for the small bank streamlined examination to $1 billion without regard to the size of the bank’s holding company.

I have been in charge of our CRA compliance for a number of years, and I have personal experience with both the small bank streamlined examination as well as the large bank examination, and can state with confidence that this change will greatly reduce the regulatory burden on our small bank while having no adverse impact on how we serve the needs of the community.

Use of the “small institution” examination standards does not materially change an institution’s obligations to serve the needs of its local community. Loan to deposit ratios coupled with an analysis of the geographic distribution of loans are good measures of how well a bank is meeting the needs of its communities within the confines of its ability to do so while maintaining core safety and soundness standards.

The streamlined examination does, however, allow smaller banks to minimize the costs associated with the CRA examination process itself. For example, at our institution as we have moved from a “small” bank to a “large” bank we have spent money on acquiring tools and skills to cope with the examination procedure itself. We spent money on software to accomplish the required CRA Data Reporting. We increased spending on developing skills to use the software. We developed new internal processes to assure we are capturing the data for loans properly. All of these costs are associated with the examination process, not with the requirement to serve the needs of our community.

We are a “community bank” and have always done our very best to support the credit needs of our local communities including the needs of low-and-moderate- income residents. While making various types of credit readily available to individuals and small businesses within our community is the most important part of our “Community Reinvestment” program, we have also always attempted to impact our communities by delivering services such as financial literacy training, financial expertise to groups serving the community, and hands on participation in programs that benefit the communities and the individuals who live here. We have also over the years made investments to the extent feasible in our local communities.

As our bank grew and became subject the large bank CRA examination, the main difference in our CRA Program is the increased time and costs spent in gathering, documenting, and reporting the data required under the large bank examination process. This increased burden of additional “paperwork” certainly does not contribute to our ability to meet the credit and financial service needs of our communities.

The FDIC proposal recognizes that there is a difference between “community banks” and large banks and will enhance the ability of community banks to serve their communities by reducing the time and cost of compliance without reducing the requirement of these banks to serve the credit needs of the local community. Banks of all sizes are subject to a host of regulations that require a high level of expertise to assure compliance. Large regional and super regional institutions generally employ a number of individuals who specialize in various regulatory issues and additional staff devoted to CRA. Small banks do not have the same resources.

The method of examination employed does not adversely impact the intent or requirements of the CRA. Small community banks only thrive when they serve the financial needs of their communities and the individuals who live there. Any reduction in the unnecessary regulatory burden created by the large bank examination, will allow small banks to allocate limited resources to better serve their communities.

Thank you for tackling the issues of unnecessary regulatory burden and for the careful consideration you are giving to all the comments you receive.

Sincerely,
Tami Janowicz
Vice President
Director of Compliance and CRA
Peoples State Bank
248-548-2900 ext 1148
tamij@bankpeoples.com

Last Updated 09/28/2004 regs@fdic.gov

Last Updated: August 4, 2024