ICBA: Uniform Community Reinvestment Act Rule Should Minimize Burdens on Community Banks

ICBA Press Release Banner 2020

In comment letter, ICBA urges agencies to limit new reporting mandates

Washington, D.C. (Aug. 5, 2022) — The Independent Community Bankers of America (ICBA) today called on federal banking regulators to issue a uniform final rule on Community Reinvestment Act modernization that minimizes new data collection and reporting burdens for community banks.

In its comment letter on the interagency proposal to modernize CRA rules, ICBA said regulators should limit new data collection mandates and create increased transparency into how ratings are established.

“ICBA and the nation’s community banks support agency efforts to modernize the CRA’s implementing regulations, though policymakers should recognize that any major regulatory overhaul will inevitably create disproportionate implementation costs for community banks,” ICBA President and CEO Rebeca Romero Rainey said today. “Regulators should continue working to tailor CRA modernization, simplify compliance for community banks, and ensure the final rule meets the needs of all community banks and the communities they serve.”

In its comment letter, ICBA also called on regulators to:

  • Allow institutions with less than $10 billion in assets to opt into new CRA tests or to retain their current exam framework.
  • Raise the asset thresholds for small and intermediate banks to $750 million and $2.5 billion, respectively, to keep pace with inflation and industry consolidation.
  • Create a qualifying activities list and confirmation process to increase certainty of what counts for credit.
  • Finalize a provision allowing banks to receive credit for community development credit outside their assessment areas.
  • Raise the loan volume thresholds for delineating Retail Lending Assessment Areas, which are designed primarily to evaluate large, direct banks and are not appropriate for community banks.
  • Grant credit for activities conducted in partnership with minority depository institutions, women-owned depository institutions, and certified community development financial institutions.
  • Apply heightened scrutiny to credit union acquisitions of community banks due to tax-exempt credit unions’ exemption from CRA rules.

Read ICBA’s complete comment letter.

About ICBA
The Independent Community Bankers of America® creates and promotes an environment where community banks flourish. ICBA is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education, and high-quality products and services.

With nearly 50,000 locations nationwide, community banks constitute roughly 99 percent of all banks, employ nearly 700,000 Americans and are the only physical banking presence in one in three U.S. counties. Holding nearly $5.9 trillion in assets, over $4.9 trillion in deposits, and more than $3.5 trillion in loans to consumers, small businesses and the agricultural community, community banks channel local deposits into the Main Streets and neighborhoods they serve, spurring job creation, fostering innovation and fueling their customers’ dreams in communities throughout America. For more information, visit ICBA’s website at www.icba.org.

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