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Federal Register Publications

FDIC Federal Register Citations



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FDIC Federal Register Citations

GATEWAY BANK AND TRUST CO

October 9, 2004

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

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

Dear Mr. Feldman:

As Chairman, President and CEO of Gateway Bank and Trust Co., a community bank serving northeastern North Carolina and southeastern Virginia, I am writing in support of the FDIC’s proposal to raise the threshold for the streamlined small bank CRA examination to $1 billion. Though my institution is currently regulated by the Federal Reserve, the FDIC’s proposal represents the logical course all of the banking regulatory bodies should follow, including the FRB.

This proposal will have an immediate and positive impact on many small banks by greatly reducing the regulatory burdens imposed under the current regulation. Increasing the size of banks eligible for the streamlined CRA examination in no way relieves banks from CRA responsibilities. Contrary to what many commenters suggest, all banks, including my own, still must meet the credit needs of our communities and be evaluated by our respective regulators.

The FDIC’s “forward-thinking” proposal will also lower my Bank’s current regulatory burden. The actual costs of time and money to Gateway Bank are incalculable; however, both are better reinvested in areas that truly benefit our customers and communities.

I further support the addition of a community development standard to the small bank examination for larger community banks. However, I strongly believe that this should apply only to community banks greater than $500 million up to $1 billion. FDIC staff is aware that it has been difficult for small banks, especially those in rural areas, to find appropriate CRA qualified investments in their own communities. Many small banks must rely on regional or statewide investments that are unlikely to benefit their own communities. This was not the intent of Congress when they enacted the Community Reinvestment Act.

Additionally I support the FDIC’s community development standard because it will provide a more graduated transition to the large bank examination. This is a significant improvement over the current regulation. When a small bank reaches the $250 million threshold, it must completely reorganize its CRA program and begin a sizeable new reporting, monitoring, and investment program. If the FDIC adopts its proposal, a state nonmember bank would advance from the small bank examination to an expanded examination, yet still streamlined. The FDIC proposal adds the flexibility to mix community development loans, services, and investments to meet the new standard.

In closing, I support the FDIC’s proposal to change the definition of “community development” to encompass a broader range of activities in rural areas. By including rural areas rather than focusing only on low- and moderate-income areas, the change will eliminate many of the distortions in the current regulation.

Sincerely,
D. Ben Berry

cc: The Honorable Alan Greenspan
Chairman, Board of Governors-Federal Reserve System

Last Updated 10/09/2004 regs@fdic.gov

Last Updated: August 4, 2024