Community banks strongly support meeting the credit needs of their entire communities, including low and moderate-income areas. ICBA supports consistent and transparent implementation of the Community Reinvestment Act (CRA). 

ICBA supports the Federal Reserve Board, OCC, and FDIC’s proposal to rescind the 2023 CRA final rule and return to the 1995 framework. The 2023 rule would have increased the complexity of CRA exams, raised compliance costs for community banks, and would not have resulted in a more accurate assessment of how well banks meet the credit needs of their communities. 

While we do not support a total rewrite of CRA rules, some changes proposed in the 2023 rule would be beneficial and should be implemented. They include higher asset thresholds, a qualifying activities list and preapproval process for qualifying activities, and allowing Minority Depository Institutions (MDIs) to receive CRA credit for supporting other MDIs.  

Regulators should do more to differentiate between larger community banks and the largest Too Big To Fail banks instead of grouping all banks over $1.609 billion in assets into the category of “large banks.” 

Community banks know and understand their communities and are best positioned to define their assessment areas, not regulators. 

Minority and women-owned financial institutions and Treasury-certified CDFIs should have a streamlined CRA exam, with a presumed rating of high satisfactory. 

Credit unions, fintech companies, and any financial firm that serves consumers and small businesses should be subject to CRA in a manner comparable to, and with equivalent asset-size distinctions, as banks and thrifts.