To the Editor:

I agree completely with John Munn ("Viewpoints: State Agencies Have Crucial Role to Play," June 17) on the value of the dual banking system and on the important role that community banks play in the U.S. economy. But I can't let pass his assertion, for which he offers no evidence, that state regulators are somehow better positioned than the OCC to supervise community banks.

Ninety-six percent of the 1,588 banks regulated by the OCC are community institutions with less than $5 billion in assets, and our examiners are based throughout the country in towns close to the banks they supervise. In Nebraska, where Mr. Munn serves as director of the Department of Banking and Finance, we have 40 examiners assigned to the 46 community national banks in that state. Most of those examiners live in Nebraska, and they go to the same Little League games, attend the same PTA meetings and shop in the same grocery stores as any other resident of that state. And yes, they know the price of corn as well as anyone in Mr. Munn's agency.

Almost all supervisory decisions are made by local examiners or an assistant deputy comptroller in the assigned field office. In Nebraska, we have local offices in Omaha and Grand Island, within close proximity of the Department of Banking and Finance's three offices, and they are every bit as accessible as state examiners.

I understand that Mr. Munn's office has roughly 30 examiners to cover Nebraska's 180 state-chartered commercial banks, and I have every reason to believe they do a fine job. But there is simply no basis for arguing that they are more in touch with local issues than the 40 OCC examiners who live in the same communities.Robert M. Garsson
Deputy comptroller for public affairs
Office of the Comptroller of the Currency

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