The Bank Administration Institute tried to create its own version of Disney's Tomorrowland at its 1996 compliance conference here.

The meetings, held at a resort just down the interstate from the Magic Kingdom, focused on the new Community Reinvestment Act and forthcoming Bank Secrecy Act regulations. Technology, auditing, and risk management got people talking, but the main areas of concern seemed to be the new CRA and money laundering rules.

Bankers packed sessions on the latter issues, looking for answers.

While regulators didn't always clear up the confusion, Bert Otto, acting deputy comptroller for compliance management in the Office of the Comptroller of the Currency, assured bankers that the new CRA exams are going smoothly. Though no exam scores have been made public yet, the agencies expect the vast majority of banks to continue winning "satisfactory" grades.

Still, Mr. Otto said, at least a couple of banks will be graded "needs to improve."

"Best practices" guidelines for small-bank CRA compliance will be released in the second half of 1996, he added.


Burden reduction was on Bobbie Jean Norris' mind as the Federal Deposit Insurance Corp.'s fair-lending specialist addressed the compliance officers.

Bankers now will get at least two months' notice before a compliance exam, Ms. Norris said. Examiners currently notify bankers only a week or two ahead of time. Also, examiners will ask in writing ahead of time for much of the exam information.

"When you get the letter, it may appear overwhelming," Ms. Norris said. "But if you think about it, you can see that it makes sense."

The FDIC also will start requiring banks to submit documents in electronic form. This will be especially true for lending data, she said, noting that this would reduce the time examiners spend sifting through loan files. "This is the wave of the future," she said.

She also had good news for banks that have developed their own CRA mapping software: Examiners will use the bank's program provided they can verify its accuracy.


Suggestions for complying with forthcoming know-your-customer guidelines didn't go over well at the conference.

John Atkinson, assistant vice president of the Federal Reserve Bank of Atlanta, said bankers who spot suspect activities should ask for customers' tax documents, financial statements, and references. That's more information, bankers complained, than they collect from loan applicants.

Responding to bankers' skepticism, Mr. Atkinson backed down slightly. "Remember, these are just suggestions," he said. "You don't have to do these."


Telephone banking allows institutions to comply with the Community Reinvestment Act without having to open costly new branches, according to William Randle, vice president of marketing and strategic planning at Huntington Bancshares, Columbus, Ohio.

"Telephone banking gives low- and moderate-income much more access to loans and other types of banking," Mr. Randle said. "This technology is going to help those people. After all, 98% or more of people have telephones."


Audience members got a public relations lesson during a debate on risk management. The discussion included various scenarios for the industry's future.

One envisioned a regulator during the next recession asking an institution to cooperate in a top-to-bottom safety-and-soundness exam. Peter J. Schild, senior vice president and internal audit director at First Union Corp., was asked how he'd respond.

"Privately, I'd be concerned," Mr. Schild said. "Publicly, I would make it very clear that I welcome the opportunity to cooperate with the regulators like that."

"You ought to be in politics," responded L. William Seidman, former FDIC chairman and now a commentator at CNBC-TV.

Mr. Schild's retort: "But aren't we all, Bill?"

Jaret Seiberg contributed to this report.

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