BPI Urges Unified, Modernized CRA Approach Among Bank Regulators

Federal Reserve should invite FDIC, OCC to craft common set of CRA rules for all banks, BPI writes in comment letter

Washington, D.C. — Today, the Bank Policy Institute submitted to the Federal Reserve a comment letter in response to its advance notice of proposed rulemaking, which solicited comments regarding the modernization of the agency’s Community Reinvestment Act regulatory and supervisory framework.  BPI presented to the Federal Reserve a set of principles that should guide the reform efforts as well as specific recommendations on elements of the CRA regulations.

“Banks are committed to investing in underserved communities,” said Dafina Stewart, Senior Vice President and Associate General Counsel at BPI. “Consistent regulatory standards for the Community Reinvestment Act across banking agencies would help them achieve that vital goal.”

As BPI stated when the ANPR was issued, it is a welcome addition to the conversation on the modernization of the CRA regulatory framework.  BPI continues to believe that the application of different CRA standards to banks regulated by different federal banking agencies would harm the ability of the banking industry to work together with the communities it serves to identify and act upon meaningful community reinvestment opportunities.  As such, the comment letter encourages the Federal Reserve to invite the FDIC and the OCC to restart an interagency process to craft a common set of CRA rules that applies to all banks.

In addition, BPI’s recommendations include:

  • The Federal Reserve should leverage existing data to evaluate performance.
  • The Federal Reserve should recognize the unique aspects of a bank’s business model in calibrating CRA tests.
  • Any changes to the regulatory requirements for delineating assessment areas should be calibrated so that they do not create or exacerbate an over-concentration of CRA activities in specific geographies and create appropriate incentives for banks to conduct activities in geographies that historically have not been major CRA activity centers. 

About Bank Policy Institute.
The Bank Policy Institute (BPI) is a nonpartisan public policy, research and advocacy group, representing the nation’s leading banks and their customers. Our members include universal banks, regional banks and the major foreign banks doing business in the United States. Collectively, they employ almost 2 million Americans, make nearly half of the nation’s small business loans, and are an engine for financial innovation and economic growth.

Media Contact:
Sean Oblack

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