(Extensions of Remarks - April 03, 2003)

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[Extensions of Remarks]
[Page E680]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                               speech of

                            HON. MAX SANDLIN

                                of texas

                    in the house of representatives

                        Wednesday, April 2, 2003

       The House in Committee of the Whole House on the State of 
     the Union had under consideration the bill (H.R. 522) to 
     reform the Federal deposit insurance system, and for other 

  Mr. SANDLIN. Mr. Chairman, I rise today in strong support of H.R. 
522, the Federal Deposit Insurance Reform Act of 2003. I appreciate the 
efforts of Chairman Oxley and Ranking Member Frank to bring this 
important bill to the floor, and I thank them for their continued 
support for this legislation. I would also like to thank Chairman 
Bachus and Ranking Member Waters of the Financial Institutions 
Subcommittee for their leadership on this bill.
  In my East Texas district, deposit insurance aids community bankers 
in attracting and maintaining core deposits, which are often used 
locally to fund mortgages, development projects, student loans and 
small businesses.
  H.R. 522 will increase deposit insurance coverage from $100,000 to 
$130,000 and will index this limit for inflation in future years. With 
a declining rural population and customer base in many areas of the 
country, including my district, raising the coverage limit will help 
small-town bankers keep up their core deposits. The current $100,000 
coverage ceiling can force bank customers in rural areas to move 
deposits over that amount outside of their region or state. This should 
not have to be the case, particularly for our older citizens.
  As the AARP noted in its recent letter of support for this 
legislation, existing coverage limits have unfortunately created a 
situation where ``the alternative is to bank at more distant 
institutions or invest in the more volatile securities markets.'' To 
help remedy this problem, H.R. 522 will increase coverage for certain 
retirement accounts to $260,000, which will help keep customer 
deposits, especially seniors' funds, in local institutions.
  The bipartisan Federal Deposit Insurance Reform Act is reasonable, 
necessary legislation that will promote growth and stability in rural 
communities while maintaining consumers' confidence in the banking 
system at the same time. I urge my colleagues to vote yes on final 
passage of this legislation.