Office of the Comptroller of the Currency Issues Final Rule on Community Reinvestment Act

Wednesday, May 20, 2020 - 8:15am

The Office of the Comptroller of the Currency (OCC) today published a final rule amending Community Reinvestment Act (CRA) regulations, six weeks after the comment period closed on the proposed rule, which received more than 7,500 comments. The final rule clarifies and expands the banking activities that qualify for positive consideration, updates how banks delineate the assessment areas in which they are evaluated, provides additional methods for evaluating CRA performance and requires timely and transparent reporting. The final rule evaluates banks on both the number of CRA-eligible loans and investments and the total amount of loans and investments to communities. The final rule’s emphasis on the dollar volume of loans and the repeal of a separate investment test raises concerns it could deemphasize low-income housing tax credit (LIHTC) and new markets tax credit (NMTC) equity investment as compared to lending. The OCC issued a non-exhaustive, illustrative list of example activities that would qualify for CRA consideration under 12 Code of Federal Regulations 25.04. The final rule is effective Oct. 1, 2020, and banks must comply with the final amendments by Oct. 1, 2020, Jan. 1, 2023, or Jan. 1, 2024, as applicable.