2024 is right around the corner and there are a few provisions everyone needs to keep on their agenda to ensure compliance with the new CRA rules finalized on October 24, 2023. In an effort to help clarify the new rules, TCA reached out to the FDIC in Washington DC. The result of this call is that TCA can confirm there are provisions that will be effective on April 1, 2024 and have summarized them below. In addition, everyone should keep watch for a message from the FDIC regarding a planned webinar to assist banks with the new final CRA rule which will provide additional clarity and guidance on the rule.
TCA utilized the FDIC – CRA Final Rule as a resource for provisions discussed in this article which is noted below:
Community Reinvestment Act (fdic.gov)
Let’s start with the section regarding the applicability and transition provisions located in Subpart E—Transition Rules § __.51 Applicability dates and transition provisions located on page 1152 of the rule which is noted below:
(a) Applicability dates. (1) In general. Except as provided in paragraphs (a)(2), (b), and (d) of this section, this part is applicable, beginning on April 1, 2024.
(2) Specific applicability dates. The following sections are applicable as follows:
(i) On January 1, 2026, §§ __.12 through __.15; __.17 through __.30; __.42(a); the data collection and maintenance requirements in § __.42(c), (d), (e), and (f); and appendices A through F of this part become applicable.
(ii) On January 1, 2027, § __.42(b), (g), (h), and (i) and the reporting requirements in § __.42(c), (d), (e), and (f) become applicable.
Therefore, there are three provisions that every bank must comply by April 1, 2024, which are:
- § __.16 Facility-Based Assessment Area(s),
- § __.43 Contents and Availability of Public File, and
- § __.44 Public Notice by Banks
TCA summarized the three provisions below:
In the section of § __.16 Facility-Based Assessment Areas. Page 1077 states:
(a) In general. A bank must delineate one or more facility-based assessment areas within which the [Agency] evaluates the bank’s record of helping to meet the credit needs of its entire community pursuant to the performance tests and strategic plan described in § __.21. (b) Geographic requirements for facility-based assessment areas.
(1) Except as provided in paragraph (b)(3) of this section, a bank’s facility-based assessment areas must include each county in which a bank has a main office, a branch, or a deposit-taking remote service facility, as well as the surrounding counties in which the bank has originated or purchased a substantial portion of its loans (including home mortgage loans, multifamily loans, small business loans, small farm loans, and automobile loans).
This provision provides additional information regarding an intermediate bank or a small bank regarding its Facility-Based Assessment Areas. The terminology of Facility-Based Assessment Area should be used when addressing a Bank’s Assessment area going forward, therefore the CRA Public File will need to be updated as of April 1, 2024.
The second provision TCA wants to highlight is one of the newest changes to the rule is in the section § __.43 Content and availability of Public File on Page 1150 states:
(c)(1) for banks that maintain a website, all information required for the bank’s public file under this section must be maintained on the bank’s website. For banks that do not maintain a website, all the information required for the bank’s public file must be maintained at the main office and, if an interstate bank, at one branch office in each State.
Banks need to start conversations with stakeholders over your website regarding uploading the CRA to the website. Stakeholders should include representation from the IT Department, Marketing and third-party vendors (if applicable).
The third provision TCA is analyzing in this is article is section § __.44 Public Notice by Banks. Page 1151 states:
A bank must provide in the public area of its main office and each of its branches the appropriate public notice set forth in Appendix F.
However, the noted Appendix F is not included in the draft of the new CRA rules. Hopefully, there will be guidance regarding the CRA Public Notice at the anticipated January 2024 webinar.
The last three provision topics that may impact your Bank and are effective April 1, 2024 are noted below. TCA provided the page numbers to these provisions for reference purposes.
- § __.31 Effect of CRA Performance on Application (bottom of 935 through 938)
- § __.45 Publication of Planned Examination Schedule. (Page 1151)
- § __.46 Public Engagement (Page 1151)
As we all navigate these new rules, feel free to contact TCA with any questions.
TCA provides A Better Way to help you navigate and understand these complex changes. Contact us at (800) 934-7347 or [email protected] if you have any questions!
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