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STATEMENT BY EUGENE A. LUDWIG, COMPTROLLER OF THE CURRENCY

 WASHINGTON, Sept. 7 /PRNewswire/ -- Eugene A. Ludwig, comptroller of the currency, issued the following:
 Under the National Bank Act, national banks are permitted to sell insurance in towns of less than $5,000. This authority exists for a simple reason: if you want banks in small towns -- and I think we all agree that is desirable -- those banks must be able to earn a profit. And if you want banks to be profitable in areas where the market for traditional banking services is limited, they simply must be able to make some money from other activities.
 The same reasoning holds true for residents of low- and moderate- income communities, particularly inner-city neighborhoods. Residents of these neighborhoods experience the same problems as small town residents in buying insurance -- or in buying insurance at competitive prices. And banks in low-income neighborhoods need to be able to make money from a wider range of activities if they are able to be profitable and grow.
 The authority of banks to provide insurance in small towns should be expanded to include low-income neighborhoods. Making banking services readily available to creditworthy residents of low- and moderate-income neighborhoods is critical to rebuilding our inner cities and preventing further declines. Making insurance available to these same residents -- at competitive prices -- is an important step to helping these neighborhoods recover. As comptroller, I will work to expand the ability of banks to provide insurance in low-income areas.
 -0- 9/7/93
 /CONTACT: Frank Vance of the Office of the Comptroller of the Currency, 202-874-4970, or 213-748-4141/


CO: Office of the Comptroller of the Currency ST: District of Columbia IN: FIN INS SU: EXE

IH-DC -- DC045 -- 9499 09/07/93 16:57 EDT
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Publication:PR Newswire
Date:Sep 7, 1993
Words:283
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