Thread Options
|
#2227322 - 12/13/19 01:00 PM
CRA Proposal Released
|
Power Poster
Joined: Sep 2010
Posts: 2,670
|
_________________________
Adam Witmer, CRCM All statements are my opinion, not those of my employer, and should not be taken as legal advice. www.compliancecohort.com
|
Return to Top
|
|
|
|
#2227347 - 12/13/19 05:29 PM
Re: CRA Proposal Released
Adam Witmer
|
Diamond Poster
Joined: May 2011
Posts: 2,004
Idaho
|
I'm 25 pages in and the changes seem massive, mostly in a good way.
_________________________
All opinions are my own, not my employer's
|
Return to Top
|
|
|
|
#2227474 - 12/16/19 06:38 PM
Re: CRA Proposal Released
Kathleen O. Blanchard
|
Diamond Poster
Joined: May 2011
Posts: 2,004
Idaho
|
The assessment area proposed changes are quite interesting including when you can change an assessment area. I am a bit puzzled by that so have pondering to do. I read the proposal to say that you are only allowed to change your AA once during an evaluation period. We are rapidly expanding our branch network, which is causing us to add counties to our AA once or twice a year. I'm not sure how to reconcile the requirement that you AA includes all your physical locations with the limitation of changing your AA only once per evaluation period.
_________________________
All opinions are my own, not my employer's
|
Return to Top
|
|
|
|
#2227479 - 12/16/19 07:10 PM
Re: CRA Proposal Released
TMatt87
|
Platinum Poster
Joined: Sep 2007
Posts: 937
|
Rant Alert!!
In stead of hitting the "Reset" button on an aged concept "CRA", we get the usual conflated, confusing, non-sense from un-elected bureaucrats that only serve to make our jobs (call it job security) difficult without adding anything of "real value" to the equation.
Its a concept that has seen it better days. They attempted to bring the rule into the 21st Century, but failed miserably. AAs are a thing of the past in today's electronic world and adding another 240 pages of fluff won't help things. Take a look at our forum here. The confusion on what constitutes a qualified investment, CDL or covered loan in staggering. Additional burdensome data reporting is what's in the cards.
|
Return to Top
|
|
|
|
#2227551 - 12/17/19 04:41 PM
Re: CRA Proposal Released
Kathleen O. Blanchard
|
Platinum Poster
Joined: Sep 2007
Posts: 937
|
You raise some good points. In the final analysis, the industry's Call Reports would be a much easier barometer to measure the FIs efforts to serve its communities without adding additional burdensome data requirements. As for the elimination of ISBs, CRA would be better served if it exempted small institutions of less than $10 billion. Take a look at the 2018 data just released. Wow, what new revelations revealed in this mountain of data collected for what purpose that's mostly of no use to other than the gov't (not a lot of difference than HMDA, another bureaucratic nightmare). Agree that the congress of late has subjugated its responsibility to these agencies and are no longer representative of the we the people. After 42 years of banking, its time for some changes for the better! I think we can all agree on that.
|
Return to Top
|
|
|
|
#2228059 - 12/28/19 02:48 PM
Re: CRA Proposal Released
Adam Witmer
|
Power Poster
Joined: Jun 2003
Posts: 7,728
Florida
|
Just to add my 2 cents in, especially about the county-wide assessment areas.
As a point, I'm not a CRA person - I'll leave that to Kathleen and Len. I get involved with it, because fair lending exams are usually done in conjunction with the CRA exam. While CRA looks at LMI areas, Fair Lending looks at discrimination, and for redlining, Majority Minority ("MM") tracts. (I'm trying to simplify - it's more involved, but for a different venue.).
Generally, CRA looks at where the loans are made, Fair Lending looks at the areas where they are not made.
Many, especially community banks attempt to serve the areas they get their deposits from. If branches are clustered, their effective influence area is limited. Forcing these banks to incorporate whole counties, especially if there are Majority-Minority tracts in the county, but substantially outside of their market/deposit area will be forcing them to serve areas for which they are ill equipped, and ill prepared.
Duval County (Jacksonville, FL) for example has 918 square miles. A community bank on the outskirts would be required to take the county, although parts would be over 50 miles away. The current way regulators look at redlining would be to identify the MM tracts and look at lending. There would be neither the marketing, infrastructure or expertise to realistically serve the areas. While this would not usually be an issue for multi-nationals or super regionals, it could be the difference as to whether a community bank can survive. (Or a bank in LA, where 1700 of the 2300 tracts are MM.)
There is a lot to read, and clarify, but for smaller banks, it may be an issue.
_________________________
Integrity. With it, nothing else matters. Without it, nothing else matters.
|
Return to Top
|
|
|
|
|
|