McWilliams: FDIC Pursuing Interagency Approach on CRA

The FDIC would like to see a consistent interagency approach to Community Reinvestment Act rules, FDIC Chairman Jelena McWilliams said today during the American Bankers Association’s Unconventional Convention. She noted that that the Federal Reserve’s recent advance notice on proposed rulemaking is “substantially similar” to the OCC’s final rule from earlier this summer.

“I’m willing to dance with whomever is willing to come to the dance floor,” McWilliams said. “It would be optimal to have two dance partners and one set of music playing.” Even though the FDIC joined the OCC’s CRA proposal in 2019, it did not join the agency in issuing a final rule in May because the one-time opt-in/opt-out choice for smaller banks would have been a major decision when banks were responding to the coronavirus pandemic and swamped with Paycheck Protection Program loans, she said.

In other regulatory news, McWilliams said she hoped for the FDIC to finalize its brokered deposit rule by the end of 2020. And with PPP loans and a surge of COVID-19-related deposits artificially bulking up banks’ balance sheets, she added the FDIC is looking at every option within its authority to adjust regulatory thresholds. “Where we have that discretion, I have instructed staff to look and make sure we’re not punishing banks for doing what we asked them to do,” she said.