CBA on OCC’s Community Reinvestment Rule
CBA on OCC’s Community Reinvestment Rule
Rule adds transparency and objectivity; Banks need maximum time for implementation
WASHINGTON – The Consumer Bankers Association today released the following statement after the Office of the Comptroller of the Currency issued a final rule on modernizing the Community Reinvestment Act:
“The OCC and Comptroller Otting should be commended for attempting to bring an analog regulation into a digital world. In doing so, the agency met with community groups, banks, Congressional leaders and other regulators. The end result lays out a more transparent and objective process for measuring banks’ continued service to their communities.
“The final rule contained needed improvements to qualifying activities, quantifying examination ratings, and providing incentives for outstanding ratings. Overall, this is a major shift in the way the nearly $500 billion worth of annual CRA investments are calculated and the OCC should give banks maximum flexibility in implementing these new reforms.
“Now that the OCC has issued its proposal, we hope the FDIC and Fed will finish their work and issue a modernized rule consistent with modern banking practices and the needs of today’s consumers.”
NOTE: In CBA’s comments to the CRA notice of proposed rulemaking, CBA advocated for several provisions which were ultimately included in the final rule to allow banks to reach more low to moderate income communities and individuals. One of those proposals addressed the issue of so-called CRA deserts and hot spots by allowing broader deposit-based assessment areas so investments could flow to additional urban areas as well as rural communities. Another accepted proposal deals with the CRA treatment of mortgages, which are often sold to GSEs. LMI mortgages are vital to local communities but often do not carry large dollar volumes. Allowing banks to retain full credit for mortgage origination or LMI mortgage purchases will help ensure these communities continue to have competitive, affordable home credit options.
More information on CBA’s work on CRA reform is available here and CBA’s comment letter on the CRA NPR is available here.
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About the Consumer Bankers Association:
The Consumer Bankers Association represents America’s leading retail banks. We promote policies to create a stronger industry and economy. Established in 1919, CBA’s corporate member institutions account for 1.7 million jobs in America, extend roughly $4 trillion in consumer loans and provide $275 billion in small business loans annually. Follow us on Twitter @consumerbankers.
