From: Richard Trent [mailto:Richard.Trent@era.com]
Sent: Wednesday, September 15, 2004 8:00 PM
To: Comments
Subject: STOP!! CRA Examination Threshold Modification
Mr. Robert Feldman
Executive Secretary
Attention Comments/Legal ESS
Federal Deposit Insurance Corp.
550 17th Street NW
Washington DC, 20429-9990
Re:RIN 3064-AC50
Dear Mr. Feldman:
As a concerned member of the San Diego Real Estate Professional
Community I am contacting you to express my concern and to discourage
your plan tomodify the threshold for CRA examination to dilute Community
Reinvestment Act requirements for institutions with assets less than
$1B. The reduced requirements would include modification of testing
requirements on the number of investments and services in low and
moderate-income areas. The second is to allow mid sized banks reduce
their community development activities.
As I understand the issue, this ruling would apply to all locally
headquartered banks in San Diego. It would only exclude the very large
national banks. It would create an unequal playing field in the banking
industry in this region. It would allow for market domination in major
geographical areas of the County for specific products and services. It
would exclude ethnic and lower income residents from basic banking
services and thereby be in direct violation of the federal Community
Reinvestment Act and quite possibly the Fair Housing Act.
As I further understand it, the effect is to allow smaller banks to
behave the way that they have traditionally been behaving in terms of
CRA compliance. In my personal experience, they traditionally display an
acute disregard for their obligation to the larger community. Branches
are almost exclusively in suburban, wealthier communities. The smaller
banks very seldom participate in regional consortia or directly offer
products or access to simple access to basic banking services.
In my view, your decision will legitimatize the exclusionary lending
policies of these institutions.
Smaller banks in San Diego are a growth industry. We grow banks for
larger, multi- national institutions. This is part of the reason that
these banks eschew CRA. It may interfere with their purchase by larger
banks. The small banks exist not for the benefit of the consumer but
rather for a select number of shareholders. CRA regulations (however
limited) are the only link to the larger community required by a bank
charter.
Government has provided much protection and risk diversion with
affordable housing, investments and small micro lending efforts. This
was offered with the confidence that the lenders would equally commit.
The RTF has done constant and disciplined assessment of credit access
and through dialogue, face to face, many new and innovative solutions
have been created, so much so that a thriving and profitable "industry"
has emerged in this region focused on economically healthy communities.
With the cost of real estate continuing to rise basic affordable
housing is becoming an unobtainable goal for far too many lower income
wage earners. If the smaller banks in San Diego have no interest or
obligation in providing their services to these individuals the greater
public interest is not served. The dream of Home Ownership should be
made available to as many familys as possible.
We urge you to rescind your intent to reduce CRA related policies
toward smaller banks. You will exclude them from very beneficial markets
and encourage recognition that they are part of a larger community and
can contribute to the regions overall economic growth.
Respectfully submitted,
Richard Trent, REALTOR
Real Estate Consultant
3365 Rosecrans Street, Suite B
San Diego, CA 92110
CC: NCRC
Rep. Bob Filner
REp. Susan Davis |
