The US federal banking agencies are seeking comments from the public on proposed revisions to their guidance on banks’ important obligations to address the credit needs of their low and moderate income customers.
The Community Reinvestment Act (CRA) requires banks to address the credit needs of low and moderate income customers in their service areas. Each of the federal banking agencies (Federal Deposit Insurance Corporation, Federal Reserve Board and Office of the Comptroller of the Currency) have promulgated regulations to implement the CRA. The agencies also issued guidance in the form of “Interagency Questions and Answers Regarding Community Reinvestment” (Questions and Answers).
After a periodic review of their CRA examination policies, procedures and guidance, and public outreach, on September 10, 2014, the banking agencies published for public comment in the Federal Register a proposal to amend the Questions and Answers to address CRA compliance questions raised by bankers and the public in the latest public outreach. The deadline for comments is November 10, 2014.
The banking agencies evaluate banks’ CRA performance under tests that vary depending upon the size of the institution. The proposal would revise certain current Questions and Answers, and add new ones, to address the agencies’ evaluation of (i) a bank’s availability and effectiveness of its retail banking services delivery systems, including alternative delivery systems; (ii) the innovativeness or flexibility of an institution’s lending under the lending test applicable to large institutions; and (iii) community development loans and activities that would be eligible for CRA credit.