The OCC today issued a long-anticipated advance notice of proposed rulemaking seeking input on the best ways to modernize Community Reinvestment Act regulations. The ANPR asks for comment on several issues, including how to:
- Encourage more lending in areas that need it most, including low- and moderate-income areas
- Broaden and clarify the types of activities eligible for CRA consideration
- Update assessment area definitions to accommodate digital lending channels
- Measure bank CRA performance by a metric-based framework, “using quantitative benchmarks” that would assign numerical values to CRA activities
- Evaluate CRA activities more consistently
- Reduce the cost and burden of CRA evaluation
The ANPR formally kicks off what will be a months-long process of modernizing the CRA regulatory framework. Because the OCC will share the ANPR results with the FDIC and the Federal Reserve, ABA encourages all U.S. banks — whether or not they are OCC supervised — to respond to the ANPR and emphasize the need for modernization.
“For years, outdated rules, a lack of transparency and inconsistent examinations have limited the effectiveness of the CRA. The current framework is holding back investment in communities the law is intended to serve, while failing to account for significant innovations in the banking sector, including the opportunities presented by mobile technologies,” said ABA President and CEO Rob Nichols in a statement, echoing perspectives he shared in a recent The Hill op-ed.
“We have heard from bankers across the country who have told us that the current CRA rules make it harder for them to serve their communities, which makes today’s OCC action both timely and necessary.”
ABA staff are reviewing the ANPR and will provide resources to facilitate banker comments, which will be due 75 days after publication in the Federal Register. Bankers can access more ABA resources on CRA reform at aba.com/ModernizingCRA.