A Federal Reserve Board ("FRB") Advance Notice of Proposed Rulemaking ("ANPR") soliciting comment on policies to modernize the "regulatory and supervisory framework" of the Community Reinvestment Act ("CRA") was published in the Federal Register.
As previously covered, the ANPR is seeking comments on, among other things:
- how to define a financial institution's local community for CRA evaluations;
- a proposed "Retail Test" containing two subtests: (i) a "metrics-based" approach that focuses on a bank's major product lines and the credit needs and opportunities of its assessment areas, and (ii) a qualitative approach aimed at improving predictability and transparency in the evaluation of "important aspects" of retail banking services (i.e., branches, delivery systems and deposit products);
- a proposed "Community Development Test" containing two subtests: (i) a "metrics-based" approach that is unique to a bank's major product lines and its assessment area's community development needs and opportunities, and (ii) an approach that would assess community development services in a manner that is more cognizant of the value of "qualifying volunteer activities," particularly in rural communities;
- updating how states, multistate metropolitan statistical areas, and institutions are rated; and
- data collection and reporting requirements.
Comments on the proposal must be submitted by February 16, 2021.
Primary Sources
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
