Banker Donald W. Stone makes no bones about it - he wants to put the Federal Deposit Insurance Corp. out of business. The outspoken Mr. Stone, who is president of Simmons First Bank in Jonesbore, Ark., suggests replacing the agency with a mutual insurance company owned by the banks.

"I want to shut them down," said the 63-year-old Mr. Stone, a former member of the American Bankers Association's government relations council and a current member of its community bankers council, in a telephone interview. "I want to shut the whole thing down."

Most community bankers grumble, if privately, of their dissatisfaction with the regulatory process. But to openly and vociferously express a desire to do away with the FDIC eagle on the door of every bank is highly unusual.

Mr. Stone claims the agency has traded tough safety and soundness examinations for the creation of Community Reinvestment Act career paths for examiners. He also claims the agency has become a tool Congress can use to beat up on banks.

"The biggest problem with the FDIC is the perception it belongs to Congress, that's the real problem." he said. "The is not a single government dollar in the fund."

Mr. Stone has an alternative plan. He says the industry could form a mutual insurance company that would acquire the Bank Insurance Fund. The company would take a tough line on safety and soundness, and would not enforce CRA regulations and the like. It would also insure all deposits.

"His proposals make a lot of sense," said F.C. Nixon, president and Chief executive of First Bank of Tallahassee, who has seen a draft of Mr. Stone's plan. "It's refreshing."

But some bankers worry about the beliefs Mr. Stone expouses.

"I think it's very irresponsible," said a banker who asked not to be identified and is a member of the ABA's community bankers council.

Salvatore Marranca, president and chief executive of Cattaraugus County Bank in Little Valley, N.Y., and a member of the council, respects Mr. Stone's opinion but disagrees with it.

"Deposit insurance is the No. 1 one critical asset we have," he said. "The government will not go away. They are in our life, they are in our face."

That hasn't stopped Mr. Stone from speaking his piece at ABA meetings or from writing letters to the trade group's top officials.

Nine months ago, Mr. Stone cracked off a two-page letter to Daniel R. Smith, president of the American Bankers Association, and chairman of First of America Bank Corp. in Kalamazoo, Mich.

"It seems to me that it would be good to set a goal for shutting down the FDIC' the letter said. "I don't mean to panic anyone and I don't mean shut them down this afternoon. It just ought to be a long-range goal of ours to give "up the 'government insurance.'"

Mr. Smith could not be reached for comment. And in ABA spokeswoman said the trade group has not considered Mr. Stone's plan.

Mr. Stone acknowledges. the concept is a hard sell, but he says there are bankers who subscribe to his line of thought.

"There are some clear thinkers that I run into," he said. "I've had people come up to me after government relations meetings ... who privately agree with me."

Mr. Stone hasn't considered dropping out of the FDIC. He is the president of one of three banks operated by Simmons First National Corp., a Pine Bluff, Ark.-based holding company with $700 million in assets, so the decision isn't his. "We don't want to be too disruptive? he said. "And I don't think we could under Arkansas law."

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