Mortgage lenders have unique compliance and risk management needs. > c e b  #; bjbj *T / l ) ) ) 8 a } L ) 8 K K K 8 8 8 8 8 8 8 $ [: . With vendors, what youdontknow canhurt you. Get in touch and let us see how we can work together. What sources do you use to qualify nonprofits?

Services, Sponsorship for Priority Telecommunication Services, Supervision & Oversight of Financial Market The Federal Reserve, the central bank of the United States, provides The number and dollar amount of consumer loans, for large banks, if applicable; and. Lenders with a CRA strategy and monitoring plan are in a better position to meet the CRA performance expectations set out by their management and boards of directors. After the comment period, the institution submits the plan to its regulator for review and approval. If a strategic plan is being submitted on behalf of more than one bank, each bank must receive the approval of its own regulatory agency for the portions of the strategic plan relating to that bank's CRA responsibilities. Under the provisions of the Freedom of Information Act (FOIA) (5 USC 552), a request for approval of a strategic plan submitted to the OCC is a public document and is available to the public upon request.

As you define those goals, and build your strategy to achieve them, compare and contrast products and services provided by your institution against the area(s) served. Strategic plans allow banks to tailor their performance goals to the needs of their community by working directly with the community to develop the goals. In determining the extent to which the institutions public files should be reviewed, consider the institutions record of compliance with the public file requirements in previous examinations, its branching structure and changes to it since its last examination, complaints about the institutions compliance with the public file requirements, and any other relevant information. For each assessment area for each bank covered by the strategic plan: The plan must include measurable goals that, if met, would constitute "satisfactory" performance. 19 Refer to 12 CFR 25.27(h) (national banks and federal branches) and 12 CFR 195.27(h) (savings associations). the email address for banks to submit requests. 6 Refer to 12 CFR 25.27(e) (national banks and federal branches) and 12 CFR 195.27(e) (savings associations). You should. Alternatively, the bank may elect to have its CRA performance evaluated under the (1) lending, investment, and service tests; (2) community development test; or (3) small-bank performance standards, whichever is appropriate. As part of your CRA examination, the regulators will review your lending, investments, and service activities. Review, Update and Organize Your Public File, Test the Integrity of the Data (Pull Samples and Compare to Source Data). Identify gaps in your lending and service by borrower income, geography or product. A bank requesting approval for a strategic plan is expected to submit the following, plus any additional supporting information bank management may wish to provide: During the term of an approved strategic plan, a bank may request approval of an amendment to the strategic plan if there is a material change in circumstances (e.g., a downturn in the economic environment, a shift in the bank's business strategy, or entrance into or exit from one or more assessment areas). 5 Refer to 12 CFR 25, appendix A(e), "Strategic Plan Assessment and Rating" (national banks and federal branches), and 12 CFR 195, appendix A(e), "Strategic Plan Assessment and Rating" (savings associations). Were here to help. Failure to define ownership can create tension,miscommunication and inefficiency within the organization. 4 12 CFR 25.27 (national banks and federal branches) and 12 CFR 195.27 (savings associations).

8 Refer to 12 CFR 25.27(e) (national banks and federal branches) and 12 CFR 195.27(e) (savings associations). A description of the bank's efforts to seek suggestions from members of the public, copies of written public comment(s) received, and, if the strategic plan was revised in light of the comment(s) received, the initial strategic plan as released for public comment. The OCC evaluates the strategic plan and all supporting information under the evaluation criteria set forth in 12 CFR 25.21(b) and 12 CFR 25.27(g)(3) and appendix A(e) (national banks and federal branches) or 12 CFR 195.21(b) and 12 CFR 195.27(g)(3) and appendix A(e) (savings associations). Grovetta N. Gardineer Fair Lending, A bank may request confidential treatment for confidential commercial information, meaning records that arguably contain material exempt from release under Exemption 4 of the FOIA.11 For example, if the requesting bank believes that disclosure of commercial or financial information included with its request would likely result in substantial harm to its competitive position or that of its affiliates, confidential treatment of such information may be requested. Make it easy to keep your employees up to date by managing and organizing the most current and important company information in one place. Catalogopportunities to lend, invest and/or provide services. UDAAP Compliance: Defining Unfair, Deceptive, & Abusive Acts and Practices. A bank may elect to be evaluated under an alternative assessment method in its strategic plan in the event that it fails to substantially meet the strategic plan's goals for a satisfactory rating. In addition, a bank may choose to have the Federal Reserve Board evaluate its performance under another appropriate evaluation method if the bank fails to substantially meet its planned goals for a satisfactory rating. Here's how: The institution informally seeks suggestions from the public while developing the plan. Interested in joining forces? There is no need to review each branch or each complete public file during every examination. CRA does, however, reinforce the long-standing expectation that financial institutions will serve the needs of their respective communities fairly and without bias. Review Bank Model Characteristics and Overall Strategy, Type of Institution (consumer, business, full service), Business Trends (growing, stable, shrinking), Review Assessment Area Characteristics and Needs, Peer Analysis (e.g., Call Reports, CRA Public Evaluations, Annual Reports/10-Ks, etc.

Find out about our amazing partners and learn how we can work together here. The OCC determines whether information labeled "Confidential" warrants confidentiality and advises the requesting bank of any decision to make information labeled "Confidential" available to the public. Once you've gotten that approval, think about including those CRA goals into compliance training, to help ensure a top-down and bottom-up approach to CRA compliance. The regulators judge a banks performance in the context of information about the financial institution and its assessment areas. Checks), Regulation II (Debit Card Interchange Fees and Routing), Regulation HH (Financial Market Utilities), Federal Reserve's Key Policies for the Provision of Financial Information for which confidential treatment is sought should be (1) segregated from the other information that is submitted; (2) specifically identified in the non-confidential portion of the strategic plan (by reference to the confidential section); and (3) labeled "Confidential."

Each request for approval of a strategic plan submitted to the OCC must contain a proposed effective date.8 The proposed effective date must be at least three months after the request is submitted to the OCC. The OCC reviews public comments to determine if the bank offered the opportunity for community input into the strategic plan, the public's degree of support for the bank's goals, and the appropriateness of the strategic goals. These guidelines do not represent new requirements but instead summarize the OCC's process for addressing bank requests for approval or amendment of a CRA strategic plan, including. Some possible performance evaluation criteria may include Lending Tests, Geographic Distribution of Loans, Investment Tests, Service Tests, Community Development Tests, Public File Review, and more. 3. In order to set a CRA strategy, you should understand your overall strategy and the underlying market. 12 Refer to 12 CFR 25.27(c) (national banks and federal branches) and 12 CFR 195.27(c) (savings associations). Please refer to the guidelines for requesting approval for a strategic plan (PDF). A bank generally does not need to supply more information regarding the performance context than the bank would normally develop to prepare a business plan or to identify potential customers, including low- and moderate-income individuals or geographies in the bank's assessment area(s). In lieu of one of the three primary evaluation methods, the CRA regulations provide banks the option to develop a strategic plan with the input of the community. They'll also look at how you achieve your CRA goals. If information initially furnished with the request changes significantly during the processing of the bank's request, the bank should communicate those changes promptly. Just because the examiners aren't looking directly at your strategy doesn't mean it's not critically important to compliance success. The primary purpose of the Community Reinvestment Act is to demonstrate that the bank is effectively working to meet the credit needs of its entire community, including low- and moderate-income neighborhoods in a safe and sound manner. 17 Refer to 12 CFR 25.27(c) (national banks and federal branches) and 12 CFR 195.27(c) (savings associations). February 09, 2022, Transcripts and other historical materials, Federal Reserve Balance Sheet Developments, Community & Regional Financial Institutions, Federal Reserve Supervision and Regulation Report, Federal Financial Institutions Examination Council (FFIEC), Securities Underwriting & Dealing Subsidiaries, Types of Financial System Vulnerabilities & Risks, Monitoring Risk Across the Financial System, Proactive Monitoring of Markets & Institutions, Responding to Financial System Emergencies, Regulation CC (Availability of Funds and Collection of Communications, Banking Applications & Legal Developments, Financial Stability Coordination & Actions, Financial Market Utilities & Infrastructures.

There is no one better positioned to craft your story and explain your performance to examiners and the community-at-large. The proposed term of the strategic plan. However, a CRA strategy that aligns products and services to the community's needs will help ensure success. The plan is submitted to the bank's regulator for review and approval at least three months before the proposed effective date. Require examiners to evaluate the performance of banks in complying with CRA. Therefore, not all of the factors described in the regulations under other evaluation types3 would necessarily apply to each strategic plan. Note that the appropriate federal banking agencies approve a joint strategic plan only if the strategic plan provides measurable goals for each bank for each assessment area covered by the strategic plan. Address discrimination in the access to loans and credit, aka prohibiting the illegal act of Redlining. k. The loan-to-deposit ratio, for small institutions. 9 Refer to 12 CFR 25.27(a)(4) (national banks and federal branches) and 12 CFR 195.27(a)(4) (savings associations). Providingyour organization with the information and capability to manage risk and compliance, making you a more attractive vendor to clients in the financial services industry.

The OCC's decision approving or denying a strategic plan may also be available to the public under the FOIA. As you finalize your CRA goals, make sure to get approval from the Board and Senior Management so that everyone is on the same page. The most important step in strategy execution may be the assignment of roles and responsibilities. These guidelines apply to all OCC-supervised banks subject to the CRA that wish to request CRA evaluation based on a strategic plan or to request approval to amend an approved strategic plan. Branches and Agencies of Pursuant to 12 CFR 25.27(f)(2) (national banks and federal branches) and 12 CFR 195.27(f)(2) (savings associations), a bank may submit information along with its strategic plan to the OCC on a confidential basis, but the goals stated in the strategic plan must be sufficiently specific to enable the public and the OCC to judge the merits of the strategic plan. It's an important indicator to examiners that you are serious aboutCRA compliance. 2. Better management builds a better bank. Only by monitoring performance can you see when your performance needs improvement, take the time necessary to figure out the cause, and address the issue before your next examination. Banks should direct questions regarding the process, preparation of a request for approval, or a pending submission by sending an email to CRA WLP-SP Requests@occ.treas.gov, calling (202) 649-5470, or contacting their supervisory office. Our integrated software and services help to ensure comprehensive, continuous exam readiness for your financial institution. Decades of industry and software experience all coming together to serve you. Before submitting a bank's initial strategic plan for OCC approval, bank management is encouraged to contact the bank's supervisory office to request an informal consultation with OCC staff.

The CRA regulation contains an option to create a public CRA Strategic Plan. Obtaining information from the public when developing the strategic plan helps to provide a bank access to the fullest possible information about the lending, investment, and service needs of its community and how those needs may be met. Are you prepared, protected, and positioned for opportunities? This sets the stage for a more constructive, credible, and efficient strategy: Performance context is another important concept in CRA compliance. The requirements for a strategic plan are contained in the CRA regulations, 12 CFR 25.27 (national banks and federal branches) and 12 CFR 195.27 (savings associations). Upon receipt of the strategic plan, the OCC will send an acknowledgment of receipt to the bank. What are the Three Lines of Defense in a Compliance Management System? We help you break down the silos, allowing your organization to collaborate for seamless, comprehensive risk management and compliance on the enterprise level. Infrastructures, Payments System Policy Advisory Committee, Finance and Economics Discussion Series (FEDS), International Finance Discussion Papers (IFDP), Estimated Dynamic Optimization (EDO) Model, Aggregate Reserves of Depository Institutions and the Lending Compliance, If a strategic plan covering multiple banks must be approved by more than one regulatory agency, each agency issues a decision approving or denying the request with respect to the bank(s) for which that agency has primary supervisory responsibility. The proposed effective date for the strategic plan, which should be at least three months after the strategic plan is submitted to the OCC. Community Development lending, investment, and service opportunities. Please note that a CRA strategy, as we're discussing here, is different than a formal CRA Strategic Plan. This request for confidential treatment must be submitted in writing concurrently with the submission of the confidential information and must discuss in detail the justification for confidential treatment. CRA, Monitoring CRAperformance can help identify weaknesses, allow the institution time to make adjustments where needed, help provide accurate reporting to the institutions management and Board, and make it possible to respond to examiners' questions. A copy of the required public notice and the name(s) of the newspaper(s) in which the required notice was published. An effective CRA strategy will consider both the institutions particular business advantages and the needs and opportunities that exist in its assessment area(s)," according to the regulators. 10 Refer to 12 CFR 25.27(g)(1) (national banks and federal branches) and 12 CFR 195.27(g)(1) (savings associations). Infrastructures, International Standards for Financial Market A copy of the approved strategic plan; b. For each bank covered under the strategic plan, whether the bank elects in its strategic plan to be evaluated under another assessment method (e.g., small, intermediate small, or large bank assessment method) if the bank fails to meet substantially the strategic plan goals for a satisfactory rating. A CRA strategy demonstrates to examiners that you take responsibility for CRA compliance. How do you qualify nonprofits that appear in the search results? Any CRA-related complaints received either by the institution or the regulators. It's important that you comply with both the letter and the spirit of CRA regulation. It can be up to five years between CRA Exams. We work with thousands of themheres your one stop shop tostay on top of the issues relevant to you.

Topics: The supervisory office schedules a consultation that generally includes staff from the supervisory office and other OCC offices. Here are 8 elements of a strong CRA compliance strategy that you should consider. 16 Refer to 12 CFR 25.27(f)(3) (national banks and federal branches) and 12 CFR 195.27(f)(3) (savings associations). 18 Refer to 12 CFR 25.27(f)(4) (national banks and federal branches) and 12 CFR 195.27(f)(4) (savings associations). For each assessment area for each bank covered by the strategic plan, copies of any information developed in the bank's normal business planning that it wants the OCC to consider regarding lending, investment, and service opportunities in the assessment area, including a description of any legal constraints or limitations that affect the type of loans, investments, or services that the bank may make or offer. ), Institutions Public File (Comments Received). This community input into the development of the strategic plan is conducted by soliciting public comments. A strategic plan may have a term of no more than five years. All written comments from the public relating to the institutions CRA performance and any responses to them for the current and preceding two calendar years (except those that reflect adversely on the good name or reputation of any persons other than the institution); c. The institutions most recent CRA Performance Evaluation; d. A map of each assessment area showing its boundaries and, on the map or in a separate list, the geographies contained within the assessment area; e. A list of the institutions branches, branches opened and closed during the current and each of the prior two calendar years, their street addresses and geographies; f. A list of services (loan and deposit products and transaction fees generally offered, and hours of operation at the institutions branches), including a description of any material differences in the availability or cost of services between those locations; g. The institutions CRA Disclosure Statement(s) for the prior two calendar years; h. A quarterly report of the institutions efforts to improve its record if it received a less than satisfactory rating during its most recent CRA examination; i. HMDA Disclosure Statements for the prior two calendar years for the institution and for each non-depository affiliate the institution has elected to include in assessment of its CRA record, if applicable; j. Learn all about our integrated approach to risk and compliance for financial institutions around the country. Each request for approval of a strategic plan should name a contact person at the bank. 112 CFR 25.27 (national banks and federal branches) and 12 CFR 195.27 (savings associations). Multi-year strategic plans must include annual interim measurable goals. the nation with a safe, flexible, and stable monetary and financial In most organizations, the Community Reinvestment Act Officer is responsible for coordinating, developing, implementing and administering the CRA compliance program. Leader Ncontracts Appoints Matthew Peace as New CFO, Tennessean Names Ncontracts a Top Workplace for the 2nd Year in a Row, Ncontracts announces new tool to lighten compliance workload, 8 Steps to a Successful Community Reinvestment Act Compliance Strategy. For each bank, an identification of the assessment area(s) covered by the strategic plan, including a list of the geographies involved. The OCC considers, as necessary, other information regarding the performance context in addition to the public comments and information submitted by the bank. 2 Refer to 12 CFR 25.27 (national banks and federal branches) and 12 CFR 195.27 (savings associations). 3 Refer to 12 CFR 25.21(a)(1)-(3) (national banks and federal branches) and 12 CFR 195.21(a)(1)-(3) (savings associations). Strategic plans may cover a period of up to five years. Ncontracts can help you think through your approach and help you to invest your time in the right resources. Your CRA strategy should help you better serve your community, improve compliance exam ratings, build internal support for CRA compliance, and ultimately help your financial institution grow. In any branch review undertaken, determine whether the branch provides the most recent public evaluation and a list of services generally available at its branches and a description of any material differences in the availability or cost of services at the branch (or a list of services available at the branch). 14 Refer to 12 CFR 25.27(f)(1)(i) (national banks and federal branches) and 12 CFR 195.27(f)(1)(i) (savings associations). How do you know if you are on track? From our yearly user conference to over 100 conferences around the country, whether virtual or in-person, Ncontracts will be therefind out our next stop and come see us! Your weekly dose of insights into the world of risk and compliance from the industry expertssubscribe to get regular updates right to your inbox! system. If such an election is not made in the strategic plan, the OCC evaluates the bank only under the strategic plan. To request the OCC's approval of a strategic plan or amendment of an approved strategic plan, a bank should submit its strategic plan(s) and supporting information by email to CRA WLP-SP Requests@occ.treas.gov using the subject line "CRA Strategic Plan." A bank should follow the guidance in this section when submitting confidential supervisory information, which includes any information contained in, related to, or derived from reports of examination, or confidential operating and condition reports. Practices, Structure and Share Data for the U.S. Offices of Foreign Do you have a strategy for Community Reinvestment Act compliance? Strategic plans must be approved by the bank's regulator in advance and must provide measurable performance goals sufficient for a satisfactory rating. The FFIEC publishes some great CRA resources about how your institution will be examined. Failure to substantially meet the goals set forth for satisfactory performance generally results in assignment of a rating of "needs to improve" or "substantial noncompliance."5. Be prepared to tell your story. 7 Refer to 12 CFR 21.21(b) and 25.27(g)(3) (national banks and federal branches), and 12 CFR 195.21(b) and 195.27(g)(3) (savings associations). Smaller financial institutions have a unique set of challenges. Report, discuss and debate the results with the Board and Senior Management. The CRA regulations require that the strategic plan be developed in consultation with members of the public, be published for public comment, and contain measurable annual goals.1 The required contents of a strategic plan and the OCC's criteria for evaluating a strategic plan are specified in the CRA regulations.2 The CRA strategic plan evaluation option provides a bank with the opportunity to tailor its CRA objectives to the needs of its community and to its own capacities, business strategies, and expertise. Meet our team! The Ncast is the place to hear and learn from industry experts on their viewpoint, challenges, and how theyre dealing with issues just like you every month! The bank's request for confidentiality should explain the harm that would result from public release of the information. This formal option allows you to create a plan that is tailored to the needs of the community by seeking public comment during development and publication. A bank must submit its strategic plan to the OCC at least three months before the proposed effective date of the strategic plan.6 If a strategic plan covers more than one affiliated bank, at least one of which is regulated by an agency other than the OCC, a copy of the entire strategic plan should be submitted to each federal bank regulatory agency that has primary supervisory responsibility for the bank(s) covered by the strategic plan. This allows them to fulfill their obligations to the community and to consider the bank's record in the evaluation of application for charters or for the approval of bank mergers, acquisitions, and branch openings. Sharing our insights and expertise with you every monthget signed up and listen in on a topic thats relevant to your role right here.