The Community Reinvestment Act (CRA) – An Overview for Small and Intermediate Banks

Date Recorded: December 7, 2023
Presenter: Ginger McCullough, Manager, Forvis Mazars, LLP and Brian Waters, President, Chief Operating Officer and Co-Founder of findCRA

A two-hour webinar that focuses on the addition of “Community Development” to a bank’s evaluation when it becomes an ISB.

The Community Reinvestment Act encourages depository institutions to help meet the credit needs of the entire communities in which they operate, including low and moderate-income neighborhoods, as well as distressed, underserved, and designated disaster areas.  How a bank is evaluated depends on an institution’s asset size – the larger the institution, the more rules that it has to comply with. There are three tiers: Small, Intermediate Small, and Large, with Small institutions subject to the Lending Test and Intermediate Small institutions subject to the Lending and Community Development (CD) Tests.

As Small banks become Intermediate Small banks, they will become subject to the CD test. This webinar will review the CD test in detail, what a CD loan, investment, and service are, the CD test evaluation, and the importance of “primary purpose” and “responsiveness.” In addition to reviewing the CRA regulation itself, the webinar will also cover applicable Questions and Answers issued by the regulatory agencies that seek to explain the vague ideas found under the rules and provide examples.

HERE’S WHAT YOU’LL LEARN:

• Intermediate small bank threshold
• The definition of “community development”
• What is a community development loan, investment, or service
• The CD test
• Definitions and importance of “primary purpose” and “responsiveness”