The Federal Reserve Board and the Federal Deposit Insurance Corporation today announced the 2022 updated asset-size thresholds used to define “small bank” and “intermediate small bank” under their Community Reinvestment Act (CRA) regulations.
Annual adjustments to these asset-size thresholds are based on the average change in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which is a measure of inflation.
As a result of the 4.73 percent increase in the CPI-W for the period ending in November 2021, the definitions of small and intermediate small banks for CRA examinations will change as follows:
- Small bank means an institution that, as of December 31 of either of the prior two calendar years, had assets of less than $1.384 billion.
- Intermediate small bank means a small institution with assets of at least $346 million as of December 31 of both of the prior two calendar years and less than $1.384 billion as of December 31 of either of the prior two calendar years.
The CRA regulations establish the framework and criteria by which the relevant agencies assess a financial institution’s record of helping to meet the credit needs of its community, including low- and moderate-income neighborhoods, consistent with safe and sound operations. Financial institutions are evaluated under different CRA examination procedures based upon their asset-size classification. For example, banks meeting the small and intermediate small bank asset-size thresholds are not subject to the reporting requirements applicable to large banks unless they choose to be evaluated as a large bank.
These asset-size thresholds are effective January 1, 2022. A list of the current and historical asset-size thresholds is available here.