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Monday, September 1, 2014

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Compliance Corner: Third Quarter 2005

CRA Alert: Banking Agencies Issue Final Community Reinvestment Act Rules

On July 19, 2005, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency approved final Community Reinvestment Act (CRA) rules that are intended to reduce regulatory burden on community banks while making CRA evaluations more effective in encouraging banks to meet community development needs.

The final rules raise the small bank asset size threshold to institutions with less than $1 billion in assets without regard to holding company affiliation. Accordingly, the new rules reduce the data collection and reporting burden for intermediate small banks, banks with assets between $250 million and $1 billion and, at the same time, encourage meaningful community development lending, investment, and services by these banks.

The rules are effective September 1, 2005.The final rules can be found at Federal Reserve Board’s website.External Link

The views expressed in this article are those of the author and are not necessarily those of this Reserve Bank or the Federal Reserve System.