It has been years since the federal bank regulatory agencies have overhauled the Community Reinvestment Act (CRA) regulations. Right now, major revisions are unfolding, but in awkward manner.
On December 12, 2019 the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) released a Notice of Proposed Rulemaking (NPR) intended to increase bank activity in low- and moderate-income communities where there is significant need for credit, more responsible lending, greater access to banking services, and improvements to critical infrastructure.
On May 20, 2020, the OCC approved a final rule to modernize the CRA regulations. The final rule is effective on October 1, 2020, but it will be several years before national banks have to fully implement the regulations.
On September 21, 2020 the Federal Reserve Board (FRB) released an Advanced Notice of Proposed Rulemaking that starts the process of revising the FRB’s Regulation BB, which implements the Community Reinvestment Act for state member banks.
On May 18, 2021, the Office of the OCC published OCC Bulletin 2021-2, which states that the OCC has determined that it will reconsider the final CRA Rule published on June 5, 2020. This is a major step towards achieving uniform revised CRA regulations.
At present the FDIC, the OCC and the Federal Reserve Board are united in the belief that major revisions to the CRA regulations are needed, but all three agencies are headed in different directions.
- Existing, proposed and revised performance tests, standards, and ratings;
- Assigned ratings under current, proposed and revised regulations;
- Assessment area delineation under the current rule and the new facility-based and deposit-based methods;
- New concepts such as retail deposits, retail lending product lines, and qualifying activities lists;
- Evaluation concepts such as CRA Evaluation Measures, geographic distribution tests, and borrower distribution tests;
- Evaluation options under current, proposed and final rules;
- Current data collection requirements and the expanded requirements under the proposed and final rules;
- Community Development activities under the current, proposed and revised regulations;
- The status of “intermediate small banks.” (Will the category continue to exist?);
- How small is a “small bank” under existing ($1.305 billion), proposed ($500 million) and revised regulations ($600 million);
- An explanation of the periodic adjustments to the asset-size thresholds used to define “small bank” and “intermediate small bank;”
- A review of recent redlining cases;
- A review of the CRA Questions and Answers, exam results and CRA agreements;
- Public file requirements;
- CRA notices;
- An explanation of how to obtain community development credit for COVID-19-related activities; and
- The status of the proposed and final revisions to the regulations.
Who Should Attend?
The program is designed for loan officers, compliance officers, CRA officers, loan department staff, bank counsel and auditors. Whether new to the requirements of the CRA and its regulations or a seasoned veteran, this program provides a comprehensive review of the rapidly changing requirements of the CRA.