CRA credit for helping after Hurricane Harvey

Posted By: txgal, CRCM

CRA credit for helping after Hurricane Harvey - 10/16/17 06:51 PM

We just experienced Hurricane Harvey in our AA and we now are offering low rate loans to the small businesses who were affected by the storm. Just want to clarify that we can report these as Community Development even if they are less than $1 million as long as we don't report them as CRA small business too.

What about low rate loans to individuals who lost cars, home repair, etc. in declared FEMA designated disaster areas?

Thank you!
Posted By: Tennismom

Re: CRA credit for helping after Hurricane Harvey - 10/16/17 08:19 PM

The classification of small business loan should not change for CRA Small Business Reporting even if the proceeds are to be used for assistance during a disaster.

Look at it this way, if a loan is not CRA Small Business/Farm reportable (due to dollar amount being >$1,000,000) then review the loan in the disaster area as you would a loan in a low or moderate income or middle-income distressed census tract documenting how is stabilizes the geography. The activity could occur in an upper income census tract but if funding goes to improve the infrastructure of a disaster area then it should count as a CDL.

Separately track information about the loan of which concessions were made in interest rates and present to the regulator during your next CRA Exam. I look at this as a community development service and the examiners may make special mention of this activity in your CRA PE.
Posted By: txgal, CRCM

Re: CRA credit for helping after Hurricane Harvey - 10/17/17 04:48 PM

Thank you! I was forgetting about the size test and only concentrating on the purpose test. We are an ISB so it is more difficult for us to make CD loans over $1 million. Not impossible just difficult.
Posted By: Tennismom

Re: CRA credit for helping after Hurricane Harvey - 10/17/17 04:53 PM

I am unfamiliar with the ISB Requirements. My post was based on activity of a Large Bank.
Posted By: txgal, CRCM

Re: CRA credit for helping after Hurricane Harvey - 10/17/17 05:31 PM

I verified and they are the same.