WASHINGTON - The American Bankers Association on Monday unveiled a steering group to help community bankers find more sources of lendable funds.

At the ABA Community Bankers Council meeting here, most participants said they are experiencing high loan demand but attracting few new deposits to fund additional lending. The council reported that loans have grown twice as fast as the rate of deposits since 1995, and that deposits have lagged behind demand for credit since 1997.

"One of the most consistent messages I have received in my discussions with community bankers across the country is the concern over funding and liquidity," said ABA president Donald R. Mengedoth, who is also chairman of Community First Bankshares in Fargo, N.D.

Though short on answers at the outset, ABA officials said the new steering group would lobby for deposit insurance reform legislation, identify regulatory barriers to new funding sources, and explore creative alternative sources.

The new funding task force will be co-chaired by Earl D. McVicker, president and chief executive officer of Central Bank and Trust Co. in Hutchinson, Kan.; and Robert F. Lowe, president of Lexington State Bank in Lexington, N.C., and vice chairman of ABA's Community Bankers Council.

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