Our Position

Community Reinvestment Act (CRA)


  • Community banks strongly support meeting the credit needs of their entire communities, including low and moderate-income areas. ICBA supports consistent and transparent implementation of the Community Reinvestment Act (CRA).
  • While the Federal Reserve Board, OCC, and FDIC’s new CRA rule includes some features tailored to community banks, it is unreasonably long and complex and will be a significant compliance burden for many community banks that have long histories of meeting the credit needs of their communities, who will nevertheless not achieve a satisfactory rating under the new rule.
  • In particular, the new Retail Lending Test, which will apply to all banks with more than $600 million in assets, is unduly burdensome.
  • Regulators should do more to differentiate between larger community banks and the largest Too Big To Fail banks instead of grouping all banks over $2 billion in assets into the category of “large banks.”
  • Community banks know and understand their communities and are best positioned to define their assessment areas, not regulators.
  • Minority and women-owned financial institutions and Treasury-certified CDFIs should have a streamlined CRA exam, with a presumed rating of high satisfactory.
  • Credit unions, fintech companies, and any financial firm that serves consumers and small businesses should be subject to CRA in a manner comparable to, and with equivalent asset-size distinctions, as banks and thrifts.


The CRA was enacted in 1977 to ensure that each insured depository institution serves the convenience and needs of its entire community, including low and moderate-income (“LMI”) neighborhoods, consistent with its safe and sound operation. This mission is the essence of what community banks do.

In 2023 the OCC, FDIC, and Federal Reserve Board published a nearly 1,500-page final rule creating a new CRA framework. We view some aspects of the rule, including the increased asset thresholds, a qualifying activities list and confirmation process, and the ability of small banks to opt-in to the new framework or continue to be evaluated under their current framework as beneficial to community banks.

However, we are deeply concerned that the complexity of the new tests, in particular the Retail Lending Test, will increase the cost of compliance and make it more difficult to attain “high satisfactory” or “outstanding” ratings. We are also concerned that Retail Lending Assessment Areas (“RLAAs”) may have the unintended consequence of causing larger community banks to reduce or eliminate lending away from their branches in order to avoid triggering the creation of RLAAs.

Staff Contact

Mickey Marshall

AVP, Regulatory Counsel



Michael Emancipator

SVP and Senior Regulatory Counsel



Lawsuit Background

On February 5, 2024, ICBA and other groups filed a lawsuit against the federal banking regulators, challenging the agencies for exceeding their statutory authority with their recent Community Reinvestment Act final rule.

The complaint — which was filed in the Northern District of Texas with the Independent Bankers Association of Texas, Texas Bankers Association, Amarillo Chamber of Commerce, American Bankers Association, U.S. Chamber of Commerce, and Longview Chamber of Commerce — asks the court to vacate the final rule and seeks a preliminary injunction to pause it while the court decides the merits of our case.

About the Lawsuit

The complaint explains how the new rules will limit future bank lending. It also identifies how the regulatory agencies exceeded their statutory authority in violation of the Administrative Procedure Act by:

  • Evaluating bank lending well beyond banks’ deposit taking footprint, as required by CRA. The final rules will evaluate bank lending across the entire country, eliminating the statutory focus on a bank’s lending in its “local community.”

  • Evaluating institutions with more than $10 billion in assets for providing deposit products and services to low- and moderate-income consumers, even though the CRA only authorizes regulators to assess a bank’s record of meeting the credit needs of its local communities.

Litigation Contact (non-media)

Maria Amoruso

Jenna Burke
EVP, General Counsel, Government Relations & Public Policy, ICBA
[email protected].

Media Contact

Nicole Swann

Nicole Swann
VP, Communications, ICBA
[email protected]