To the Editor:

John Hawke's comment in the March 14 issue of the American Banker demonstrates once again that he is missing the point of banker opposition to the so-called Fico tax.

Last July, I first heard Mr. Hawke set forth the rationale behind the Clinton administration's attempt to stick banks with the obligation to pay off more than 75% of the Fico bond obligation over the next 23 years. It's essentially the same argument he's using today, but bankers didn't buy it then and don't buy it now.

First, the "urgency" that's alleged to exist is based on projections by the FDIC and others that have a history of being inaccurate.

Second, objective analysis of today's reality, including the recent history of the saving and loan industry's performance, shows that the sky in not falling, in spite of the hysteria coming from some associated with the thrift industry.

Third, the movement of funds from SAIF to BIF can be slowed or stopped altogether if the Treasury would simply utilize the tools it has at its disposal. Congress made certain that banking and thrift regulators had the authority to keep SAIF-insured institutions from moving funds in order to escape the Fico obligation. Regrettably, the comptroller appears to be the only one who understands what Congress intended.

Under a worst-case scenario, a "problem" is certainly possible - down the road. And that's what bankers are saying. To insist that there is an emergency that demands action now is pure rationalization for an attempt to justify the desired result: forcing banks to bear most of the Fico burden.

The administration's plan, which imposes a huge, long-term cost on banks to use their capital for fixing a perceived problem, is reminiscent of its earlier efforts to force banks to fund inner-city capital needs under the guise of alleging lending discrimination.

Outrageous settlements like the one at Chevy Chase Federal Savings Bank were forced on bankers by the Justice Department, and bankers quickly got the message: Their capital, rather than tax dollars, would be used to further social agendas that would otherwise require tax dollars.

Roger M. Beverage

President and chief executive,

Oklahoma Bankers Association

Oklahoma City

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