OCC Seeks Overhaul Of CRA Regs

Agency seeks comments from bankers in drafting a revised rule

Banking regulations implementing legislation that was enacted 41 years ago will soon undergo a substantial overhaul, and bankers have a significant opportunity to revamp how this law is applied.

In late August, the Office of the Comptroller of the Currency issued an advanced notice of proposed rulemaking that seeks input on modernizing the Community Reinvestment Act regulations. Congress enacted CRA in 1977 with the goal of encouraging banks to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods, without compromising safety and soundness. CRA requires that each insured depository institution’s record in helping meet the credit needs of its entire community be evaluated periodically.

The ANPR, published in the Sept. 5th issue of the Federal Register, asks for comments on several issues, including the following.

  • encouraging more lending in areas that need it most, including low- and moderate-income areas 
  • broadening and clarifying the types of activities eligible for CRA consideration 
  • updating assessment area definitions to accommodate digital lending channels 
  • measuring bank CRA performance by a metric-based framework, “using quantitative benchmarks” that would assign numerical values to CRA activities 
  • evaluating CRA activities more consistently 
  • reducing the cost and burden of CRA evaluation

“Unfortunately, the rules surrounding CRA simply have not kept up with the times,” said Keith Thornburg, general counsel for the Missouri Bankers Association. “In some instances, changes to the economic environment have rendered the CRA regime a hindrance to investments that are needed to improve banks’ communities and their markets.”

Thornburg notes it has been nearly 20 years since Congress last enacted CRA amendments in 1999. The most recent regulatory amendments by the banking agencies were in 1995 and 2005. “Banking and communities have changed immensely since 2005,” he said. “The current CRA framework is holding back investment in communities that the law is intended to serve.”

The OCC will accept comments on the ANPR until Monday, Nov. 19. Because these comments may be shared with federal agencies, including the Federal Deposit Insurance Corporation and the Federal Reserve, all banks should respond to the ANPR and emphasize the need for modernization.
“Your comments can be brief and straightforward, or they can be detailed and technical,” Thornburg said. “The most effective comments are based on your bank’s experiences and your communities. Your perspective and experience as a banker are critical.”

Thornburg said banks may want to consider addressing these areas for CRA reform in their comments to OCC.

  • Facility-focused assessment areas do not reflect new ways that banks deliver services through various technology or online avenues. A bank may well reach businesses and consumers in a low- or moderate-income (LMI) area that is beyond the bank’s physical main office and branches. A bank should be credited with all its resources addressed to LMI people in various communities.
  • Greater consideration must be given to products, services and community development projects that serve a bank’s entire market area, particularly where there is a demonstrated benefit to LMI people in rural areas or neighborhoods.
  • The types of loans, investments and services eligible for CRA credit should be expanded and better defined.
  • Banks should be provided an access point to obtain prompt advance CRA eligibility determinations from their respective primary federal regulators. Some of these determinations should be published to assist all banks.
  • The regulatory agencies should develop and implement more objective elements for CRA evaluations to promote consistency in examinations, as well as the ability for banks and examiners to identify peer groups.
  • Establish agency consistency and expertise by promoting the use of CRA-specific examiners.
  • Bank programs that support and promote financial literacy and education, as well as financial counseling, should be considered for CRA.
  • Develop standards and resources to ensure the timely completion of CRA examinations and the prompt issuance of CRA examination reports.
  • Clarify the circumstances where potential violations of consumer protection laws affect CRA examinations. Ensure that CRA and consumer compliance examinations proceed separately so that a CRA examination or report is not held open and allow relevant consumer protection law issues to be addressed in the next succeeding CRA examination, if appropriate.
  • Clearly provide that “community development plans” are an option but not a requirement to resolve a “less than satisfactory” CRA rating in the context of any application process.
  • Authorize banks to maintain convenient electronic access to their available public CRA materials, with the option for any party to request a physical copy of the information in the bank’s public file.
  • Simplify CRA data, documentation and reporting requirements.  

MBA will submit comments to the OCC and urges its members to do the same. Information on how to submit comments and resource materials outlining areas for CRA reform follow.


  • ABA Banking Journal Podcast
    Krista Shonk with the American Bankers Association outlines the process for modernizing Community Reinvestment Act regulations and how bankers can get involved.

  • A Financial System That Creates Opportunities – Banks and Credit Unions
    This June 2017 report from the U.S. Department of Treasury presented many areas for legislative and regulatory reform. Pages 69-70 of the report specifically address CRA.

    The Treasury noted that financial institutions and the communities they serve often suffer harm because applications for new facilities or mergers are held up for years because of the long cycle for CRA examinations, the length of time that it takes to issue examination reports and the time required to remediate adverse CRA findings. In addition, the examination process and rating system do not take into account the new banking channels that consumers and businesses use to access financial services and products. Banks routinely use technology and automated online offerings that extend the banks’ geographical markets, yet the CRA is tied to areas of the bank’s physical facilities. The Treasury paper also noted the inconsistent issues across the bank regulatory agencies with regard to CRA examination standards and reports. 

  • The Federal Financial Institutions Council’s Report to Congress
    Issued in March 2017, this joint report to Congress discusses the Economic Growth and Regulatory Paperwork Reduction Act. Pages 41-18 of the report address CRA.

  • CRA Modernization” 
    The American Bankers Association issued this white paper to the Treasury Department in December 2017.

  • Community Reinvestment Act – Findings and Recommendations
    This April 2018 memo from Treasury Department directs the OCC, the Federal Reserve and the FDIC to consider particular CRA reforms. 

Submitting Comments

The Office of the Comptroller of the Currency is accepting comments on its advance notice of proposed rulemaking that was published Sept. 5 in the Federal Register. Comments can be submitted until Monday, Nov. 19.

The OCC will accept public comment on a broad basis, including state charters and Federal Reserve member banks, in anticipation that the banking agencies will act on a joint agency basis to implement CRA reforms. Please submit comments or task someone in your bank to do so. The most effective comments are based on the experience you have had in your own bank and in your own community.

Instructions for Submitting Comments

You must include “OCC” as the agency name and “Docket ID OCC-2018-0008” in your comment. In general, the OCC will enter all relevant comments received into the docket and publish your comment on the Regulations.gov website without change, including any business or personal information that you provide, such as name and address information, email addresses or phone numbers. Comments received, including attachments and other supporting materials, are part of the public record and subject to public disclosure. Do not include any information in your comment or supporting materials that you consider confidential or inappropriate for public disclosure.

Your comments do not have to be in a particular format or formality. MBA has reviewed hundreds of comments, and many of the best comments are brief statements that explain your experiences helping your communities and your customers.

There are five options for submitting your comments.

  1. Online
    Go to the Federal eRulemaking Portal at regulations.gov. Enter “Docket ID OCC-2018-0008” in the search box and click “Search.” Click “Comment Now” to submit public comments. Click the “Help” tab on the regulations.gov home page for information on using Regulations.gov, including instructions for submitting public comments.
  2. Email comments to regs.comments@occ.treas.gov.
  3. Fax comments to 571-465-4326.
  4. Mail comments to Legislative and Regulatory Activities Division, Office of the Comptroller of the Currency, 400 7th Street SW, Suite 3E-218, Washington, DC 20219. 
  5. To hand deliver or use a courier service, send comments to 400 7th Street SW, Suite 3E-218, Washington, DC 20219.