|
About the Community Reinvestment Act
Question: What does the bank need to know about the Community Reinvestment Act?
Answer: The Community Reinvestment Act (CRA) is intended to encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods. This Act has become even more vital given the housing crisis currently facing the country. The most important things to know about the CRA are:
- The Act provides a framework for depository institutions and community organizations to work together to promote the availability of credit and other banking services to underserved communities.
- Under the Act, banks and thrifts have opened new branches, provided expanded services, adopted more flexible credit underwriting standards, and made substantial commitments to state and local governments or community development organizations to increase lending to underserved segments of local economies and populations.
- The CRA requires that each depository institution's record in helping meet the credit needs of its entire community be evaluated periodically. That record is taken into account in considering an institution's application for deposit facilities.
- CRA examinations are conducted by the federal agencies that are responsible for supervising depository institutions: the Board of Governors of the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the Office of the Comptroller of the Currency (OCC), and the Office of Thrift Supervision (OTS).
- The CRA requires that each office of the institution maintain a public record of CRA information. The record must include:
- All written comments regarding CRA efforts that have been received from the public for the current and previous two years.
- The public section of the latest CRA Performance Evaluation.
- A list of all institution branches with addresses and detailed information about the area in which they are located.
- Available product and service information that the lender offers to its community.
- A map of the assessment area(s).
- CRA Disclosure Statement (if applicable).
- Home Mortgage Disclosure Act Disclosure Statement (if applicable).
Bank officials must ensure that all bank employees are trained annually, as compliance with the CRA isn’t just about regulatory evaluations and following the rules; the Act is important to the community that your bank services.
The Edcomm Group
The Edcomm Group is a 19-year old multimedia training company specializing in the banking industry. The Edcomm Group offers programs such as Compliance, Teller, BSA, AML, EEO, Sexual Harassment, Elder Financial Abuse, Bank Risk, Credit Risk Management, Fraud Prevention, Security, Ethics, OSHA, Lending, Sales & Service, System Simulations, Retail Systems, System Conversions, Leadership & Operations Management. To learn more, please contact Dr. Linda Eagle, President of The Edcomm Group, at 888-433-2666 or linda.eagle@edcomm.com, and visit us on the web at www.bankersacademy.com.
First published on BankersOnline.com 5/12/08
Privacy Policy Disclaimer Recommend This Site ! Contact Us
BankersOnline is a free service made possible by the generous support of our advertisers and sponsors. Advertisers and sponsors are not responsible for site content. Please help us keep BankersOnline FREE to all banking professionals. Support our advertisers and sponsors by clicking through to learn more about their products and services.
|
|
|
Print Friendly!
Email This Article!
Discuss NOW!