community .docx - What is a community bank It has been noted that though banks size may be the best single proxy for identifying a community bank(Robert

What is a community bank? It has been noted that though banks size may be the best single proxy for identifying a community bank, (Robert, William & Gregory, 2004). If this is used to define the community banks, then some of the large community banks will not be left out but the small ones will. It does not just use fixed size limits to determine which banks belong in our sample. A community bank can therefore be define by considering the total consolidated assets it owns as well as consider other factors like the extent at which the bank can use the geographic scope plus the community relationship approach. Table 1: The Definition of Community Banks in the U.S. Author Definition of Community Banks in the U.S. The Comptroller of the Currency (OCC) Banks with less than $1 billion in total assets and may include limited-purpose chartered institutions, such as trust banks and community development banks. The Government Accountability Office (GAO) Used a $10 billion cutoff in a study on community banks. Federal Reserve Board Community banks serve businesses and consumers throughout the country, in both rural and urban areas, and are leading provider of credit to small businesses. In general, community banks can be defined as those owned by organisations with less than $10 billion in assets. Regional and community banking organisations constitute the largest number of banking organisations supervised by the Federal Reserve System. Tanya & Joseph 2013 The term “community bank” is used generally to describe medium and small banking organisations located in and focused on limited geographic areas and that engage in traditional banking activities while obtaining most of their funding from local deposits.

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Young.R.D., Hunter.W.C.& Udel.G.F 2004 “A community bank is a financial institution that accepts deposits from and provides transactions services to local households and businesses, extends credit to local households and businesses, and uses the information it gleans in the course of providing these services as a comparative advantage over larger institutions. Federal Deposit Insurance Corporation (FDIC) A summary of the definition appears in Table 2 Table 2 FDIC Community Bank Definition: 1. An institution that has less than $1 billion in assets1 is a community bank if it: (1) At year end, does not have an asset concentration exceeding 50% of total assets in non- community speciality banks, including:  credit card specialists, consumer nonbank banks,  industrial loan companies,  trust companies, and/or  bankers’ banks; and (2) Holds less than 10% of its assets in foreign assets.