The state banking department has announced a 45% cut in its fourth-fiscal-quarter assessment on state-chartered banks and foreign bank agencies in Texas.

State regulators said the cut, which should save the affected banks and agencies more than $900,000, comes because they've been able to predict their expenses more accurately for new budgets. The department is barred by law from collecting more from banks than it costs to operate the agency.

Also, because of the industry's health, the heavy pace of consolidation, new banking laws, and the new 18-month examination cycle, officials have downsized the banking department, said Banking Commissioner Catherine A. Ghiglieri.

The normal total quarterly collection from all banks is about $2 million. Assessment rates have not changed since the department started charging fees four years ago. But officials are reviewing their needs for the next two years and may be able to reduce the assessment for that period, Ms. Ghiglieri said.

In 1995, the department reduced assessments by more than $2 million, saving banks a full quarterly fee.

"This reduced assessment is another example of good state government in action," Ms. Ghiglieri said, "and is reflective of a well-managed and healthy banking environment in Texas."

- Compiled by Jonathan D. Epstein and Laura Pavlenko Lutton

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