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Joint Comment Letter re Request for Guidance on Certain Provisions of CRA Regulations
Dear Ms. Gardineer and Mr. Nguyen:
Thank you for meeting with the Bank Policy Institute and the Consumer Bankers Association (together, the “Associations”) in early Summer to discuss the Office of the Comptroller of the Currency’s May 2020 final rule revising the Community Reinvestment Act regulations. The Associations write to provide the OCC with a set of questions on the final rule on which we request the agency’s guidance. These questions are based on our review of the final rule and input from CRA compliance officers at our member banks as they begin the process of implementing the revised regulations. In addition, we have included for your consideration recommended responses for certain of these questions, which are the result of thoughtful deliberation by our member banks and are informed by their extensive experience
complying with the CRA.
The Associations appreciate the OCC’s consideration of this request. Please do not hesitate to contact the undersigned with any questions.
Community Reinvestment Act – Proposed Q&As
Transition to Final Rule
1. For banks with a compliance date of January 1, 2023, the recordkeeping requirements of section 25.25 and the reporting requirements of section 25.26 become effective on that date. For these banks, the data collection requirements of section 25.21 also take effect on that date. Since there will have been no data collection obligations before then, will the OCC require any reports on the January 1, 2023 compliance date? If so, what data will the OCC expect banks to use to generate the reports? If not, by what date will banks be required to file their first report under section 25.26?
No reports will be required under the final rule until a bank has been required to start collecting data that will form the basis of such reports, beginning as of the compliance date of January 1, 2023, and has collected such data for one full year following the compliance date. As such, a bank will not be required to file its first report under section 25.26 of the final rule until June 30, 2024. Subsequent reports covering annual and multi-year periods will be due by March 31 of the year following the end of the period. This timing will allow for banks’ reporting functions to complete Call Report and HMDA filings prior to the CRA filing each year.
2. Will any evaluation period cover years both before and after a bank’s compliance date (e.g., if the bank’s current evaluation period ends on December 31, 2020 or December 31, 2021, and the bank has a compliance date of January 1, 2023)?
Each bank with a current evaluation period ending on December 31, 2020 or December 31, 2021 and a compliance date of January 1, 2023 will have the option to (1) have its current evaluation period extended through December 31, 2022, (2) have its performance in the one- or two-year period between the end of its current evaluation period and the compliance date be considered a separate evaluation period, or (3) develop an alternative transition plan in consultation with its examiners. Under any of these options, the OCC will not require a bank to be evaluated under the final rule’s general performance standards, or to collect or report data required by the final rule, prior to the compliance date. The first year during which a bank’s activities will be subject to mandatory evaluation under the final rule’s general performance standards is 2023 (with evaluation occurring after the completion of the evaluation period that begins January 1, 2023).