For immediate release

The Federal Reserve Board today announced its approval of the application of JDOB Inc., Sandstone, Minnesota, to acquire Centennial National Bank, Walker, Minnesota. Attached is the Board's Order relating to this action.

JDOB Inc. Sandstone, Minnesota Order Approving Acquisition of a Bank

JDOB Inc., Sandstone, Minnesota ("JDOB"), a bank holding company within the meaning of the Bank Holding Company Act ("BHC Act"), has applied for the Board's approval under section 3 of the BHC Act (12 U.S.C. § 1842) to acquire Centennial National Bank ("Bank"), Walker, Minnesota, a de novo nationally chartered bank. Notice of the proposal, affording interested persons an opportunity to submit comments, has been published (61 Federal Register 53,746 (1996)). The time for filing comments has expired, and the Board has considered the application and all comments received in light of the factors set forth in section 3 of the BHC Act. JDOB is the 166th largest commercial banking organization in Minnesota, controlling deposits of approximately $39.1 million, representing less than 1 percent of total deposits in commercial banking organizations in the state.1 Bank's de novo entry into the Brainerd, Minnesota banking market2 would enhance competition in that market. Based on all the facts of record, the Board concludes that consummation of the proposal would not have any significantly adverse effects on competition or the concentration of banking resources in any relevant market. The Board also has determined in light of all the facts of record that financial and managerial resources and future prospects of JDOB, its subsidiaries, and Bank, and considerations relating to the convenience and needs of the communities to be served, are consistent with approval of the application, as are the other supervisory factors the Board must consider under section 3 of the BHC Act.3 Based on the foregoing and all the facts of record, the Board has determined that the application should be, and hereby is, approved. The Board's approval of the proposal is conditioned on compliance by JDOB with commitments made in connection with the application. The commitments and conditions relied on by the Board in reaching this decision shall be deemed to be conditions imposed in writing by the Board in connection with its findings and decision, and, as such, may be enforced in proceedings under applicable law. The acquisition shall not be consummated before the fifteenth calendar day following the effective date of this order, or later than three months after the effective date of this order, and Bank shall be open for business within six months after the effective date of this order, unless such periods are extended for good cause by the Board or the Federal Reserve Bank of Minneapolis, acting pursuant to delegated authority.

By order of the Board of Governors,4 effective December 20, 1996. Jennifer J. Johnson Deputy Secretary of the Board

Footnotes 1 All banking data are as of June 30, 1996. 2 The Brainerd banking market consists of Crow Wing County and portions of southern Cass County, all in Minnesota. 3 Comments by First National Bank of Walker, Walker, Minnesota ("First National"), contend that information in JDOB's application to charter Bank, primarily financial data and projections, is incorrect. In addition, First National maintains that Bank's proposed chief executive officer cannot effectively manage both Bank and another JDOB subsidiary bank and that numerous financial institutions currently serve the credit needs of the community. First National also has asserted that the banking market cannot support an additional competitor. The Board has carefully reviewed these comments in light of all the facts of record, including information from JDOB that substantiates its financial information, reports of examination assessing the financial and managerial resources of JDOB and the Bank's effect on those resources, and the "satisfactory" rating of JDOB's current subsidiary bank at its most recent examination for Community Reinvestment Act performance by its primary federal supervisor, the Office of the Comptroller of the Currency ("OCC"). The Board previously has concluded that the BHC Act requires the Board to focus on whether a proposal would substantially lessen competition or create a monopoly and that the establishment of a de novo bank would have a positive effect on competition in any banking market. See Wilson Bank Holding Company, 82 Federal Reserve Bulletin 568 (1996). In addition, the OCC has reviewed First National's contentions and reaffirmed its preliminary determination to approve Bank's charter. For these reasons, and based on all the facts of record, the Board concludes that all the factors required to be considered under the BHC Act are consistent with approval. 4 Voting for this action: Chairman Greenspan, Vice Chair Rivlin and Governors Kelley, Lindsey, Phillips, and Meyer. Absent and not voting: Governor Yellen.

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1996 Orders on banking applications