A 3-year-old pilot program by the Office of the Comptroller of the Currency that lets well-capitalized community banks exceed per-borrower lending limits is being extended for another three years.
The program, which began in August 2001 and was originally supposed to end next month, will also be expanded to cover agricultural loans, the OCC said Wednesday. It already covered small-business and one- to four-family residential loans.
Most national banks can lend no more than 15% of their capital to a single borrower. However, the pilot program allows well-capitalized community banks in the 38 states where state-chartered banks have higher lending limits to make loans equal to 25% of capital.
The OCC said that the program is working well, but that more information must be gathered to determine whether to make it permanent.
At the end of June, 178 national banks headquartered in 23 states were participating in the program.
