Federal Agencies Issued a Notice of Proposed Rulemaking to Revise Certain Provisions of the Community Reinvestment Act

Tuesday, March 15, 2005 - 7:00am

The Office of the Comptroller of Currency (OCC), Federal Housing Finanace Board and Federal Deposit Insurance Commission (FDIC) last week issued a notice of proposed rulemaking to revise certain provisions of the Community Reinvestment Act (CRA). This latest rule was issued in response to public comments received by the federal banking agencies and the Office of Thrift Supervision (OTS) on a February 2004 inter-agency CRA proposal and by the FDIC on its August 2004 CRA proposal. The current proposal would provide a simplified lending test and a flexible new community development test for small banks with an asset size between $250 million and $1 billion. Also, holding company affiliation would not be a factor in determining which CRA evaluation standards applied to a bank. In addition, the proposal would revise the term “community development'” to include certain community development activities, including affordable housing, in underserved rural areas and designated disaster areas. Comments will be accepted on the proposal through May 10, 2005. Click here for more information.