May 20, 2020

OCC: Final Rule Issued to Strengthen and Modernize CRA Regulations

The Office of the Comptroller of the Currency (OCC) today released a final rule strengthening and modernizing the agency’s regulations under the Community Reinvestment Act (CRA).

The final rule will increase bank CRA-related lending, investment, and services in low- and moderate-income communities where there is significant need for credit, more responsible lending, and greater access to banking services. The final rule reflects careful consideration of the more than 7,500 comments stakeholders submitted in response to the notice of proposed rulemaking announced on December 12, 2019. The OCC made several changes to the proposal that respond to stakeholders’ comments, including:

The final rule will benefit communities, businesses, and banks by:

The CRA was enacted in 1977 to encourage insured depository institutions to help meet the credit needs in their local communities, including low- and moderate-income neighborhoods. The final rule preserves this important objective but responds to dramatic changes in the banking industry since the law’s enactment and regulatory changes in 1995. The final rule addresses the shortcomings in the current CRA regulatory framework that has not kept pace with banking industry advancements, and ensures the regulations no longer adversely affect the very communities the CRA was intended to help.

The final CRA rule applies to national banks and savings associations, which conduct the majority of all CRA activity.

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This post was originally published here.