Feature Article: 

An Introduction to the FDIC’s Small-Dollar Loan 

Pilot Program 

On February 5, 2008, the FDIC selected 31 banks to 

participate in its Small-Dollar Loan Pilot Program.1 

The pilot is a two-year case study designed to illustrate 

how banks can profitably offer affordable small-dollar 

loans as an alternative to high-cost financial products, 

such as payday loans and fee-based overdraft protection. Participating banks provide quarterly information 

about their small-dollar loan programs, which will be 

analyzed to identify and report on the most effective 

features for creating profitable business models for 

such loans. 

This article summarizes the key parameters of the pilot, 

the proposals that participating banks described in 

their applications, and the first quarter 2008 results. 

Overall, banks in the pilot originated more than 3,100 

small-dollar loans, with a principal balance of about 

$3.7 million in the first quarter. Eight of the banks 

reported on existing small-dollar loan programs, while 

the remaining banks reported on new programs. It is 

difficult to draw conclusions on the basis of only one 

quarter of data for mostly new programs. However, an 

important initial observation is that small-dollar loans 

have provided pilot banks with opportunities for crossselling other products, which creates significant potential for building profitable customer relationships. 

Parameters of the Pilot 

To be considered for the pilot, an insured institution 

had to meet the following requirements: 

•	 A composite “1” or “2” rating on its most recent 

Safety and Soundness examination, and a Management rating of “1” or “2”; 

•	 Satisfactory policies and procedures in all areas, 

including lending, audits, aggregate risk, internal 

controls, liquidity, interest rate risk, compliance, 

and Bank Secrecy Act/Anti-Money Laundering; 

1 More information regarding the FDIC Small-Dollar Loan Pilot Program 

can be found at http://www.fdic.gov/smalldollarloans. 

•	 A composite “1” or “2” rating on its most recent 

Compliance examination; 

•	 At least a “Satisfactory” rating on its most recent 

Community Reinvestment Act evaluation; and 

•	 Not currently subject to a formal or informal 

enforcement action or the subject of an investigation or inquiry. 

A key goal of the pilot is to observe and encourage 

participating institutions to experiment with providing 

safe, sound, affordable, and profitable small-dollar loans. 

Therefore, the FDIC provided only general guidelines 

for banks that sought to participate. It was anticipated 

that programs would be generally consistent with the 

FDIC’s Small-Dollar Loan Guidelines, with room for 

some exceptions.2 The following are some of the 

primary features described in the Guidelines: 

•	 Loan amounts of up to $1,000 

•	 Payment periods that extend beyond a single 

paycheck cycle 

•	 Annual percentage rates (APRs) below 36 percent 

•	 Low or no origination fees 

•	 No prepayment penalties 

•	 Streamlined underwriting 

•	 Prompt loan application processing 

•	 Automatic savings component 

•	 Access to financial education 

2 The FDIC’s Small-Dollar Loan Guidelines, issued on June 19, 2007, can 

be found at http://www.fdic.gov/news/news/press/2007/pr07052a.html. 

FDIC QUARTERLY 23 2008, VOLUME 2, NO. 3 
Small-Dollar Loan Program Proposals from 

Participating Banks 

Banks that met the selection criteria submitted an 

application to the FDIC describing their existing 

or proposed small-dollar loan programs. The FDIC 

selected 31 banks, with assets ranging from $26 million 

to $10.4 billion, to be part of the pilot (see Table 

1). The participating banks are headquartered in 17 

states and have more than 560 branches located in 

27 states. The banks have on average 18 branches, 

although the number of branches varies from 1 to 67.3 

3 Data are from first quarter 2008. 

Table 1 

Eight of the 31 banks had small-dollar loan programs 

operating when they applied for the pilot, while 23 

banks described new programs. Many of the banks— 

especially those with new programs—have already 

made changes based on lessons learned during the 

design and launch phases. However, it is useful to 

summarize their initial plans to track and report on 

the outcomes of practices as the pilot proceeds. 

Loan Characteristics. At the time of application, 

24 banks indicated that they would offer only closedend credit, two indicated that they would offer both 

open- and closed-end credit, one indicated that it 

would offer only open-end credit, and four were 

unclear as to the type of credit they would offer. 

Banks in the pilot set initial maximum interest rates 

Small-Dollar Loan Pilot Program Participants Vary in Size 

Bank Location Total Assets ($000s) Number of Branches 

Amarillo National Bank Amarillo, TX 2,623,339 15 

Armed Forces Bank Fort Leavenworth, KS 803,840 51 

Bank Commerce Stilwell Stilwell, OK 77,098 3 

Bank Five Fall River, MA 671,445 13 

BBVA Bancomer USA Diamond Bar, CA 141,008 33 

Benton State Bank Benton, WI 45,833 3 

Citizens Trust Bank Atlanta, GA 354,311 10 

Citizens Union Bank Shelbyville, KY 579,178 20 

Community Bank & Trust Cornelia, GA 1,148,448 44 

Community Bank of Marshall Marshall, MO 84,815 6 

Community Bank-Wheaton/Glen Ellyn Glen Ellyn, IL 300,497 3 

Cooperative Bank Jacksonville, NC 958,700 24 

First National-Fairfax Fairfax, MN 26,010 1 

First State Bank Tonganoxie, KS 317,881 9 

First United Bank Crete, IL 495,480 5 

Kentucky Bank Paris, KY 633,263 16 

Liberty Bank New Orleans, LA 377,924 17 

Liberty National Paris, TX 246,857 3 

Main Street Bank Kingwood, TX 201,244 3 

Mitchell Bank Milwaukee, WI 81,555 11 

National Bank of KC Overland Park, KS 942,043 6 

Newbridge Bank Greensboro, NC 2,068,656 41 

Oklahoma State Bank Guthrie, OK 41,804 4 

Pinnacle Bank Nebraska Lincoln, NE 2,182,610 56 

Red River Bank Alexandria, LA 647,274 12 

Riverside National Bank Fort Pierce, FL 4,519,993 67 

State Bank of Alcester Alcester, SD 82,866 1 

The Heritage Bank Hinesville, GA 664,455 28 

The Savings Bank Wakefield, MA 389,335 9 

White Rock Bank Cannon Falls, MN 148,214 7 

Wilmington Trust Wilmington, DE 10,377,373 44 

Note: Data are from first quarter 2008. 

Source: FDIC 

FDIC QUARTERLY 24 2008, VOLUME 2, NO. 3 
 

 

 

 

 

 

Small-Dollar Loan Pilot Program 

between 11 percent and 36 percent, with an average Chart 1 

of 18 percent. Two-thirds of the banks planned to Eighty Percent of Small-Dollar Pilot Program offer maximum interest rates in the 13 percent to Banks Offer Interest Rates of 18 Percent or Less 18 percent range (see Chart 1). 

Interest Rate: Interest Rate: Fifteen banks reported that they would charge an 19% to 36% 

67% of 

pilot banks 

13% of 

pilot banks 20% of 

pilot banks 

Less than 12% 

application fee. The fees ranged from $18 to $61.50, 

with an average fee of $34. For banks providing APRs, 

the average for their small-dollar loans ranged from 

14 percent to 27 percent. 

Loan terms ranged from three biweekly installments 

(six weeks) to 36 monthly payments. As shown in 

Chart 2, maximum planned loan terms were fairly 

well distributed among banks offering 12, 24, and 

36 monthly payments. 

Underwriting and Program Features. At the time 

of application, most banks did not address the use of 

credit scores in underwriting, although four banks 

specified that minimum credit scores would be required 

and three indicated that there would be no minimum 

credit scores. Five banks indicated that they planned 

to underwrite small-dollar loans within 24 hours of 

application submission, while the other banks did not 

Interest Rate: 

13% to 18% 

Source: FDIC 

Chart 2 

Most Small-Dollar Loan Pilot Program 

Participants Plan to Offer Loans with 

between 12 and 36 Installments 

35 

address turnaround times. 30 

25 Most banks did not indicate whether deposit account 

relationships would be a prerequisite for consumers 20 

receiving small-dollar loans. However, nine banks 15 

indicated that they would require such a relationship. 

Of these banks, six indicated that direct deposit of a 10 

paycheck or another income stream would be manda- 5 

tory. Moreover, four of these six banks (and two 

Percentage of Pilot Program Participants

0

others) encouraged automatic debit for note 

payments. 

Source: FDIC 

Seventeen banks did not specify a consumer education 

component in their applications, while 14 banks 

mentioned some sort of financial literacy component. 

Less than 12 12–18 24 36 

Maximum Number of Loan Payments 

Many applications described consumer education very 

generally, for example, mentioning that credit counseling would be made available as needed or indicating 

that financial literacy materials are available in the 

bank branch. 

A few banks provided more explicit descriptions of 

financial education. One application indicated that 

three formal financial education classes would be 

required for customers with very low credit scores. 

Another bank, which receives referrals for its smalldollar loan program from a nonprofit organization, 

described a comprehensive financial literacy package 

featuring budget evaluation, case management, financial education, and a crisis-intervention program that 

is a prerequisite to a consumer being referred for a 

small-dollar loan. Another bank indicated that it 

would offer a $15 rebate of the application fee to 

small-dollar loan applicants who completed a formal 

financial literacy course. 

Linked Savings Programs. In launching the pilot, the 

FDIC indicated a particular interest in programs with 

automatic savings features. The FDIC plans to determine whether savings products linked to small-dollar 

loans will reduce customer reliance on short-term, 

FDIC Q UARTERLY 25 2008, V OLUME 2, N O . 3 
 

 

 

 

 

 

 

high-cost credit over time. Sixteen banks planned to 

have mandatory savings elements in their small-dollar 

loan programs, while another 4 encouraged savings 

and 11 indicated no plans for linked savings accounts. 

All of the savings programs indicated that the savings 

accounts would partially collateralize the loans and 

specified limits on withdrawals, generally tied to the 

life of the loan. Six banks indicated that some portion 

of the amount borrowed, ranging from 5 percent to 

25 percent, would be added to the principal amount of 

the loan and deposited into a savings account. One 

bank indicated that a flat $500 would be added to the 

principal of each loan and deposited into a savings 

account. Four banks said they would require periodic 

deposits to savings accounts by adding some amount— 

$10 or $15, or 25 percent of the payment—to each 

scheduled loan repayment. 

Five banks indicated that they would make financial 

contributions to the savings accounts of borrowers as 

follows: 

•	 An additional 10 percent in principal will be added 

to the loan and deposited into a savings account. 

If the loan is repaid as agreed and the customer is 

able to match the original deposit into savings, the 

bank will refund application fees. 

•	 At the time of the loan, the bank will open a 

savings account for the customer and deposit $1. 

If the loan performs as agreed, the bank will match 

customer deposits into the account up to $100. 

•	 At the time of the loan, the bank will add $15 to 

the principal of the loan and deposit it in a savings 

account. If the loan performs as agreed, the bank 

will add 10 percent of the balance of the savings 

account to the customer’s account. 

•	 At the time of the loan, customers will have the 

option of opening a savings account with as little 

as $5. The bank will match the opening deposit up 

to $25. 

•	 Customers will be encouraged to open a passbook 

savings account with as little as $1 and a waiver of 

all service charges. The bank will match the first 

$10 in deposits in each account. 

existing customers, while the remainder were undecided at the time of application or indicated that the 

program would be open to both existing and new 

customers. 

Sixteen banks specified target markets for their smalldollar loan products, with some targeting multiple 

markets: 

•	 Ten specified low- and moderate-income households. 

•	 Four specified military personnel. 

•	 Three specified college students. 

•	 Two specified the Latino market. 

•	 One specified the Native American market. 

One bank indicated that it planned to offer seasonal 

small-dollar loans around holidays and during tax season. 

The banks outlined a number of diverse advertising 

strategies in their applications for the pilot. They 

mentioned 66 different but related approaches, the 

most common of which were media advertising 

(11 banks) and point-of-sale displays (10 banks) 

(see Table 2). 

Summary of First Quarter 2008 Results 

First quarter 2008 results were due May 15, 2008. Of 

the 31 banks in the pilot, 29 submitted reports.4 Of 

those banks, 8 reported on programs that existed 

before the pilot, and 21 reported on newly developed 

programs. Four of the banks with new programs indicated that they did not make any small-dollar loans 

during the quarter, as they were finalizing aspects of 

their programs. The 25 banks that originated smalldollar loans during the quarter all reported that they 

made only closed-end loans. 

Banks were asked to provide separate data points 

for loans of up to $1,000 and more than $1,000. 

This threshold is consistent with the Guidelines and 

was chosen for the pilot to determine whether the 

$1,000 level can be used as a “bright line” for a replicable small-dollar loan template (see Table 3). In 

addition, five of the banks with existing programs 

Marketing and Advertising. Nine banks indicated 4 The two banks that did not submit reports indicated that they did not 

that small-dollar loans would be offered only to their originate small-dollar loans in first quarter 2008. 

FDIC QUARTERLY 26 2008, VOLUME 2, NO. 3 
 

 

 

 

 

 

 

 

 

Small-Dollar Loan Pilot Program 

Table 2 

Pilot Program Banks Have Diverse Marketing Strategies 

Marketing Category 

Percentage of 

Number of Percentage of Banks Using 

Banks Using Approach Approach 

Marketing Approach Approach Usagea (31 Banks) 

Percentage 

of Total Usage 

for Categoryb 

Traditional 

bank 

marketing 

Providing brochures 1 1.5 3.2 

Direct mailing 4 6.1 12.9 

Statement stuffers 4 6.1 12.9 

Financial literacy programs 6 9.1 19.4 

Point of sale displays 10 15.2 32.3 

37.9 

Staff or 

communitybased 

marketing 

Outbound calls 2 3.0 6.5 

Staff incentives 1 1.5 3.2 

Market to current customers 4 6.1 12.9 

Word of mouth 4 6.1 12.9 

Referrals from nonprofits 5 7.6 16.1 

Via social service organizations 4 6.1 12.9 

Via churches 2 3.0 6.5 

33.3 

Media 

marketing 

Media announcements 3 4.6 9.7 

Media advertising 11 16.7 35.5 21.2 

Internet 

marketing 

Bank website advertising 4 6.1 12.9 

Internet advertising 1 1.5 3.2 7.6 

TOTALS: 66 100.0 N/A 100.0 

Source: FDIC 

a Sixty-six distinct, but often related, approaches were noted in the bank applications. This column shows the distribution of the use of the 66 approaches. 

b The 66 approaches were organized into four marketing categories. This column shows the distribution of the use of the four categories. 

had disproportionately large programs compared 

with those of the other banks; therefore, results for 

these banks are isolated from the rest of the group 

in Table 3 to prevent skewing the loan volume. 

However, with respect to basic loan characteristics— 

such as interest rates, fees, and repayment terms— 

there is little difference between banks that made a 

few loans and those that originated a large volume 

of loans. Therefore, there is no distinction between 

large and small programs for the small-dollar loan 

term data in Table 4. 

As shown in Table 3, 20 banks originated 1,523 loans 

of $1,000 or less with combined principal of about 

$1 million. Four banks originated almost 1,400 of 

these loans, with one particularly active bank reporting 966 loans of $1,000 or less. Excluding these large 

originators, the 16 banks that made small-dollar loans 

up to $1,000 originated eight loans on average. 

For loans above $1,000, 15 banks originated 1,617 

loans with combined principal of about $2.7 million. 

Five banks originated more than 1,500 of these loans, 

with one bank reporting 623 loans above $1,000. 

Excluding these large originators, the ten banks that 

made small-dollar loans above $1,000 originated eight 

loans on average. 

Table 4 summarizes the basic characteristics of smalldollar loans made in first quarter 2008. For banks that 

made loans of $1,000 or less, the average loan size was 

$678, the average loan term was ten months, and the 

average interest rate was 15.1 percent. Seven banks 

that originated loans of $1,000 or less reported APRs 

averaging 23.8 percent. 

For banks that made loans above $1,000, the average 

loan size was $1,695, although two banks in this group 

reported making average loans greater than $3,000.5 

The average loan term for loans in excess of $1,000 

was 17 months, and the average interest rate was 15.5 

5 In this initial reporting period, to encourage innovation, there was 

no limit on the loan amount that could be included in the pilot. An 

unintended consequence of not having an upper limit was that a 

few banks reported several larger loans that may have skewed the 

average. As the result of a discussion with participating banks about 

what constitutes a small-dollar loan, a reporting limit of $2,500 will be 

imposed for future data submissions. 

FDIC QUARTERLY 27 2008, VOLUME 2, NO. 3 
Table 3 

Small-Dollar Loan Pilot Program 1Q08: Summary of Loan Number and Volume Data 

Number of 

Banks Reporting Total Average Minimum Maximum 

Loans Up to $1,000 

All Banks 

# of Notes 20 1,523 53 1 966 

Note Volume 14 $1,013,118 $72,366 $401 $641,050 

Banks Originating Fewer Than 50 Loans 

# of Notes 16 132 8 1 29 

Note Volume 10 $71,147 $7,115 $401 $21,710 

Banks Originating More Than 50 Loans 

# of Notes 4 1,391 348 55 966 

Note Volume 4 $941,971 $235,493 $24,450 $641,050 

Loans Over $1,000 

All Banks 

# of Notes 15 1,617 108 1 623 

Note Volume 12 $2,696,996 $224,750 $1,500 $1,207,145 

Banks Originating Fewer Than 50 Loans 

# of Notes 10 75 8 1 28 

Note Volume 7 $124,109 $17,730 $1,500 $78,420 

Banks Originating More Than 50 Loans 

# of Notes 5 1,542 308 57 623 

Note Volume 5 $2,572,887 $514,577 $121,544 $1,207,145 

Source: FDIC 

Table 4 

Small-Dollar Loan Pilot Program 1Q08: Summary of Loan Characteristics 

Number of 

Banks Reporting Average Minimum Maximum 

Loans Up to $1,000 

Loan Amount 

Term (months) 

Interest Rate 

(percent) 

Non-zero Fees 

(dollars) 

APR 

14 

19 

19 

4 

7 

$678 

10 

15.05 

$40 

23.80 

$100 

3 

5.25 

$12 

11.00 

$1,000 

27 

33.00 

$65 

34.00 

Loans Over $1,000 

Loan Amount 

Term (months) 

Interest Rate 

(percent) 

Non-zero Fees 

(dollars) 

APR 

12 

14 

15 

4 

4 

$1,695 

17 

15.53 

$59 

16.48 

$1,202 

5 

9.21 

$25 

11.19 

$3,750 

36 

31.41 

$134 

22.88 

Source: FDIC 

FDIC QUARTERLY 28 2008, VOLUME 2, NO. 3 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Small-Dollar Loan Pilot Program 

Small-Dollar Loans Open the Door to Profitable Relationships 

Armed Forces Bank: Using Small-Dollar Loans Pinnacle Bank: Using Small-Dollar Loans to 

to Retain Customers Create New Relationships 

Armed Forces Bank in Fort Leavenworth, Kansas, Pinnacle Bank, headquartered in Lincoln, Nebraska, 

with more than $800 million in total assets and is a $2.2 billion bank with 56 branches. Pinnacle 

51 branches, has been originating small-dollar Bank’s small-dollar loan program is new; the first 

loans for about four years. The program has about loans under the program were originated during first 

$4.5 million in loans outstanding (about $1.8 quarter 2008. The program was initially piloted in 

million was booked in first quarter 2008) and is two branches in Lincoln and Omaha, and was 

targeted almost exclusively to military personnel. targeted to the Latino market. Pinnacle originated 

Armed Forces Bank generally offers loans from 19 loans under its small-dollar loan program through 

$250 to $2,000. All loans are closed-end transac- the first quarter. All loans are closed-end, with terms 

tions for up to 24 months. The interest rate is 18 ranging from seven to ten months, and interest rates 

percent, and there are no fees. The borrower must are about 10 percent. Fees of up to $50 may be 

open an account with the bank and maintain direct assessed, but beginning in third quarter 2008, half of 

deposit. Loan payments are automatically debited the fee will be rebated if the customer opens a 

from the borrower’s account. savings account. 

Armed Forces Bank views its small-dollar loan as While it is too early to assess the overall profitability 

a retention product that helps customers who are of the program, Pinnacle Bank has noted that the 

experiencing problems regain their financial program has not negatively affected bank profitabilintegrity and allows them to remain in a banking ity. Pinnacle Bank views the small-dollar loan as a 

relationship. Armed Forces Bank reports that it way of introducing new customers to the bank and 

generally breaks even on this program and that noted that 18 of its 19 small-dollar loan customers 

relationships with small-dollar customers are just have expanded their relationship with the bank by 

as profitable as those with customers who use migrating to other products. Most have added 

more traditional products and services. In addition checking accounts; 14 have debit cards; 5 have 

to obtaining the use of funds from the mandatory savings accounts; 1 has a certificate of deposit; and 

direct deposit, the bank has been successful in 1 has opened an Individual Retirement Account. 

migrating small-dollar loan customers to other Pinnacle Bank has been pleased with the response to 

products. In first quarter 2008, 64 small-dollar the new program so far. Beginning in second quarter 

loan customers who paid as agreed migrated into 2008, the program was expanded to all branches in 

traditional loan products. Lincoln and Omaha, and Pinnacle will soon begin a 

marketing campaign with direct mail and newspaper 

advertisements. The marketing plan will specifically 

address the encouraged savings component, offering 

borrowers a coupon for $25 toward new saving. 

Advertising will also directly position Pinnacle’s 

small-dollar loan as an alternative to payday lending. 

percent. Four banks that originated loans in excess of 

$1,000 reported APRs that averaged about 16.5 percent. 

Other Program Statistics. Since most of the small-dollar 

loan programs are new and reporting has just begun, 

only five banks reported delinquencies for loans made in 

the first quarter, ranging from 1 to 19 loans per bank. 

Of the 29 banks that reported first quarter results, 

linked savings are mandatory for 13 programs, strongly 

encouraged for 8 programs, and not required for 8 

programs. Thirteen banks reported that a total of 46 

linked savings accounts were opened. Ten banks 

reported an approximate aggregate balance of $21,300 

in linked savings accounts. 

FDIC QUARTERLY 29 2008, VOLUME 2, NO. 3 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three banks noted that they believed small-dollar loan 

customers were using fewer high-cost debt products, 

although these observances were mostly anecdotal. 

Few banks provided profitability data for their 

programs, primarily because most programs are new 

and have a relatively low volume of loans. However, 

three banks indicated that they broke even on the 

small-dollar loan product, while two indicated that 

they did not. Including deposits and other accounts, 

five banks reported that the overall relationship with 

small-dollar loan customers was profitable, while two 

reported that it was not. 

The relationship-building aspect of the small-dollar 

loan product could prove to be important in determining the feasibility and profitability for banks in the 

pilot. More than half (13) of the 25 banks that reported 

first quarter results indicated that customers have 

already migrated to other bank products from the smalldollar loan product, while only 2 banks reported no 

migration. Deposit accounts are the predominant products that pilot banks have opened for small-dollar 

customers, although other, more sophisticated products 

also have been provided. One bank that had an existing program indicated that many small-dollar loan 

customers are approved for auto loans after their initial 

small-dollar loan is paid and that “auto loans appear to 

be the next step in establishing a lending relationship 

with small-dollar loan customers.” 

Two case studies presented in the text box highlight 

the profit potential for cross-selling to small-dollar 

loan customers.6 Armed Forces Bank has the largest 

and oldest program in the pilot; it reports that while 

the small-dollar program breaks even, the overall 

customer relationship is as profitable as a traditional 

6 Banks listed in this article are for illustration only. The FDIC does not 

endorse any bank or product. 

relationship. Pinnacle Bank created a new small-dollar 

loan program and is not yet able to assess its profitability. However, it reports strong migration to other bank 

products (18 of 19 borrowers) and views the smalldollar loan as an important draw for new customers. 

Conclusion 

Although the Small-Dollar Loan Pilot Program is still 

in its initial stages, participating banks are already 

demonstrating innovative strategies in areas such as 

advertising and linked savings that may prove to be 

replicable for other banks. Banks in the pilot are well 

within the 36 percent maximum APR established in 

the FDIC’s Small-Dollar Loan Guidelines, and five 

banks thus far have reported using the small-dollar 

product as a cornerstone for profitable relationships. 

These early results provide some indication that banks 

can profitably provide affordable alternatives to highcost, short-term credit. The FDIC will continue to 

explore profitability and other noteworthy features of 

participating bank programs as the pilot progresses. 

Authors: Susan Burhouse, Senior Financial Economist 

Division of Insurance and Research; 

sburhouse@fdic.gov. 

Rae-Ann Miller, Special Advisor to the Director 

Division of Insurance and Research; 

rmiller@fdic.gov. 

Aileen G. Sampson, Financial Economist 

Division of Insurance and Research; 

aisampson@fdic.gov. 

The authors would like to thank the following persons for 

their review of this article: Andrew Stirling, Special 

Advisor, Division of Supervision and Consumer Protection, 

FDIC; Robert Dixon, Senior Vice President, Lending, 

Armed Forces Bank; and Dennis Thomas, Director of 

Regulatory Compliance, Pinnacle Bank. 

FDIC QUARTERLY 30 2008, VOLUME 2, NO. 3