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Regulator Approval-Small Branch Services Reduce

With the reassignment of a lender at a branch office, we no longer have a loan officer on site. Must we seek approval from regulators to reduce the services of a small branch office? We still offer full depository and safe deposit box services, but do not have a lender in the branch. We have another branch office within 5 miles that is fully staffed. When changing from full (dep​osit​ and loan services) to limited services, must advance approval be sought?

Answer by Randy Carey:

Why can't you designate an individual to accept loan applications at that branch and just forward them to the branch with the loan officer. There are tons of banks that have branches were they don't have resident loan officers (i.e., most grocery store branches for example) or have centralized underwriting. I'm not sure why you feel it necessary that you have to reduce services at that branch. You just need to think outside of the box. It is not going to look good from a CRA aspect.


Answer by Andy Zavoina:

I would see it as a possible CRA issue, but you will be more aware of the branch and customer base than I. Still, it will not help CRA.

Taking Randy's situation one step further, there could be a telephone that would go to a lender if you didn't want a staffer trained to take apps. And the branch wouldn't necessarily have to take all apps, commercial and RE could be referred to a branch more equipped to handle the disclosures. Borrowers wanting those loans want the best help they can get anyway as there are usually many questions to answer for them.

First published on 09/03/2017

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