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On February 5, 2024, ICBA and other groups filed a lawsuit against the federal banking regulators, challenging the agencies for exceeding their statutory authority with their recent Community Reinvestment Act final rule.
The complaint — which was filed in the Northern District of Texas with the Independent Bankers Association of Texas, Texas Bankers Association, Amarillo Chamber of Commerce, American Bankers Association, U.S. Chamber of Commerce, and Longview Chamber
of Commerce — asks the court to vacate the final rule and seeks a preliminary injunction to pause it while the court decides the merits of our case.
The complaint explains how the new rules will limit future bank lending. It also identifies how the regulatory agencies exceeded their statutory authority in violation of the Administrative Procedure Act by:
Evaluating bank lending well beyond banks’ deposit taking footprint, as required by CRA. The final rules will evaluate bank lending across the entire country, eliminating the statutory focus on a bank’s lending in its “local community.”
Evaluating institutions with more than $10 billion in assets for providing deposit products and services to low- and moderate-income consumers, even though the CRA only authorizes regulators to assess a bank’s record of meeting the credit
needs of its local communities.
|Comments on CRA Modernization Proposal
|FDIC, Fed, OCC
|CRA Comment Period Extension Request Banking Trades Joint Letter
|Joint Trades Letter to OCC Regarding 2020 CRA Rescission
|OCC CRA Rule Recission ICBA Comment
|Joint Letter on Withdrawing CRA Rule
|Letter Regarding CRA Information Collection Survey
|ICBA Comment Regarding CRA Advance Notice of Proposed Rulemaking
|ICBA OCC CRA Benchmarks NPR Comment - 2021
|Request to Withdraw CRA Information Collection
|ICBA Letter Regarding CRA - April 8, 2020
|National Banking Trades Letter Regarding CRA Comment Deadline
|FDIC, Office of the Comptroller of the Currency
The CRA was enacted in 1977 to ensure that each insured depository institution serves the convenience and needs of its entire community, including low and moderate-income (“LMI”) neighborhoods, consistent with its safe and sound operation. This mission is the essence of what community banks do.
In 2022 the OCC, FDIC, and Federal Reserve Board published a notice of proposed rulemaking outlining a new CRA framework. We view some aspects of the proposal, including the increased asset thresholds, a qualifying activities list and confirmation process, and the ability of small banks to opt-in to the new framework or continue to be evaluated under their current framework as beneficial to community banks.
However, we are concerned that the complexity of the new tests, in particular the Retail Lending Test, may increase the cost of compliance and make it more difficult to attain “high satisfactory” or “outstanding” ratings. We are also concerned that Retail Lending Assessment Areas (“RLAAs”) may cause larger community banks to reduce lending away from their branches in order to avoid triggering the creation of RLAAs.