A bank’s CRA examination will be conducted by its federal regulatory agency which is assigned based on how the bank is chartered. This agency could be:
- The Office of the Comptroller of the Currency or OCC
- The Federal Deposit Insurance Corporation or FDIC
- The Federal Reserve
Prior to examination, each regulator published a scheduled of upcoming examinations, listing the banks that will be examined in the next calendar quarter. These list can be found on the regulator’s respective websites.
In advance of the CRA examination, the CRA examiner assigned to the bank will begin to review the bank’s public data as well as other specific data requested from the bank. In addition, the CRA examiner begins to build the performance context for the examination by reviewing what has occurred in the banks markets or assessments areas since the last examination. They will also speak with community leaders to determine the needs of the community.
After they have finished scoping the examination and completing offsite review, the CRA examiner will conduct an onsite visit at the bank. They will spend anywhere from a few days to several weeks onsite reviewing data and documentation that the bank provides to show their CRA performance. They will also independently assess the bank’s CRA performance in comparison to regulatory requirements and the peers in the bank’s assessment areas.
During the examination, the CRA examiner will determine if the bank’s efforts to support its communities exceed, meet or fall below the regulatory expectations and the peers in their community. The CRA examiner utilizes standardized examination procedures to conduct their review but also have flexibility to assess the bank’s performance based on their professional expertise.
At the end of the examination, the regulator will issue a CRA Public Evaluation for the bank and assign one of four overall ratings to the bank’s CRA performance:
- Outstanding
- Satisfactory
- Needs to Improve
- Substantial Non-compliance