Just a reminder of what loans are reportable for small business and small farm for CRA as we enter reporting season and many non-reporters are preparing for examinations.
CRA leads you to the definitions in the Call Report, which are in instructions for Schedule RC-C2 (Small Business and Small Farm loans), which leads you to the line items in Schedule RC-C1.
>Small business loan means a loan included in “loans to small businesses” as defined in the instructions for preparation of the Consolidated Report of Condition and Income.
>Small farm loan means a loan included in “loans to small farms” as defined in the instructions for preparation of the Consolidated Report of Condition and Income.
The Call Report rules for small business and small farm loans are in the instructions for Schedule RC-C2.
The instructions provide the dollar amounts, that carry through to CRA, and direct you to the the applicable line items from Schedule RC-C1 of the Call Report that flow to Schedule RC-C2, Loans to Small Businesses and Small Farms.
1. Small Business loans are loans of $1 million or less (regardless of annual revenue, that is simply an added piece of information for reporting and analysis) that are reported on line 1.e(1), 1.e(2) and line 4/4a of the call report. 1.e(1) and 1.e(2) are loans secured by owner occupied and non-owner occupied non-farm non-residential real estate. Loans on lines 4 or 4a (the line difference is determined by the Call Report version for your bank) are commercial and industrial loans (not secured by real estate).
2. Small Farm loans are loans of $500 thousand or less that are reported on line 1(b) - secured by farmland, and line 3 (loans for financial agricultural production and other loans to farmers).
Loans must meet the rules for those lines of Schedule RC-C1 of the Call Report to flow through to the Small Business and Small Farm reporting in Schedule RC-C2 and on to CRA reporting. The Call Report instructions contain detailed information.
If you cannot rely on your bank's Call Report coding (a totally separate problem because the bank attests it is accurate), then use the rules for those line items in the Call Report instructions to identify Small Business and Small Farm loans. Only loans that qualify for those line items can be Small Business or Small Farm for CRA.