MIAMI - When it comes to community reinvestment and fair-lending, Charles B. Stuzin is not afraid to speak his mind.

Mr. Stuzin, president of Miami's $4.5 billion-asset Citizens Federal Bank, told attendees at a University of Miami School of Law conference that the antidiscrimination laws give community groups and Justice Department lawyers too much power.

Mr. Stuzin, whose bank scored a "satisfactory" on its most recent Community Reinvestment Act exam, appeared to startle conference attendees, including officials from Justice and the Federal Reserve.

When bankers are under Justice's spotlight, he said, they often take the position that "I don't know what I've done, but I'm going to sign the papers."

Litigation costs too much, creates bad publicity, and puts expansion plans on hold, he said.

Mr. Stuzin also said community groups frequently threaten to derail expansion applications if banks don't provide low-cost loans and other incentive plans that the groups want. Even worse, community groups will picket banks and call newspapers.

"I'm just telling you the problems we face on a daily basis," Mr. Stuzin said.

The blunt talk may surprise some because Citizens Federal carries a positive CRA reputation. "They're one of the good guys," said Kenneth Thomas, a Miami-based author on CRA issues.

Mr. Stuzin said during an interview that this very reputation is what allows him to speak out.

"I'd be nervous if I thought I had a need to be nervous," Mr. Stuzin said. "But our company has a great record. We spend a lot of time on it, and we believe CRA is good for the country and good for the bank."

Paul A. Schosberg, president of America's Community Bankers, said Mr. Stuzin is known for his tell-it-like-it-is style.

"It is not one of these spontaneous combustion spasms that you might hear when the industry gets together," said Mr. Schosberg, who's known Mr. Stuzin for 15 years. "What you hear from Charlie is a very thoughtful argument of what he believes."

Mr. Schosberg credits Mr. Stuzin's behavior to Citizen Federal's unique history. Mr. Stuzin's father created the bank 43 years ago, and the Stuzin family still owns 38% of it. Mr. Stuzin began his banking career as a teller in the 1950s. He joined the bank full time in 1967 and became president in 1980.

"Charlie and his family have always felt that their bank is an essential part of the community," Mr. Schosberg said. "It is more of an emotional thing rather than financial."

Not everyone agrees with Mr. Stuzin's criticisms. Kerry Scanlon, deputy assistant attorney general, said he can't fathom seeing Mr. Stuzin simply signing a consent decree without a fight. Also, he said, Mr. Stuzin's charge that other banks have acquiesced without an argument is off base.

"The facts obviously are quite a bit different than that," Mr. Scanlon said. "What has happened in these cases is not that the Justice Department has put something down and the banks have signed it, but there have been lengthy discussions over months and years with a bank until something is worked out that the bank not only agreed with but was very much a part of."

Al Hirshen, a former director of the Office of Community Investment at the Federal Home Loan Bank Board, said the critics such as Mr. Stuzin speak from individual experience, and thus their comments may not reflect general conditions throughout the industry.

"They have to be listened to with an educated ear," he said.

Nevertheless, Mr. Stuzin's comments were riveting, quieting a group that was restless after three days of lectures. Mr. Stuzin said his institution has invested in scores of low-income housing developments, providing the financing for projects that house the countless immigrants who move into the area.

This type of lending is crucial to reviving the country's urban areas, he said. "It is good lending," he said. "It should be done. I really believe that."

While other bankers loudly protest the idea of "credit allocation," Mr. Stuzin urges bankers to dedicate a set percentage of their assets to community reinvestment lending.

"It is like charity in that regard," he said.

Though he supports community reinvestment, he said the government's enforcement system is so perverse that bankers prefer to score "satisfactory" than "outstanding" on their CRA exams.

"You don't want a 'one' rating because the next day there is a somebody at your door saying you can't be that perfect because you didn't give me my loan," Mr. Stuzin said.

The combination of community group protests, regulatory pressure, and Justice Department threats force banks to participate in special programs where they make below-market-rate loans.

"We are not supposed to make below-market loans," he said, referring to safety and soundness concerns. "But, we do."

He also noted that CRA and fair-lending were back-burner issues until recently. "Could it be because there were Republicans in charge?" he asked rhetorically.

As proof of the change, he recalled that a chief examiner burst into his office in the early 1980s and told him to type up a two-page report on CRA compliance so the examiner could include it in the safety and soundness report that he was just completing.

That same report was 50 pages in 1993, he said.

The regulations don't help banks who do want to comply, he said, noting that examiners told him four years ago that he delineated too large a community and told him two years ago that he delineated too small an area.

"You never know if you've done enough," he said.

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