As the Federal Reserve contemplates updates to its Community Reinvestment Act regulations, the American Bankers Association emphasized the importance of working closely with the FDIC and OCC to “craft a modern regulatory framework that can be adopted by all three agencies.” ABA warned that “failure to act in coordination would yield undesirable results—including perpetuating confusion and inconsistency—which would be contrary to the objectives of the modernization effort.”
ABA also outlined several objectives and principles that should guide any CRA modernization effort, noting that, among other things, a modernized framework should be durable, tailored and aimed at improving consistency, transparency and effectiveness. Additionally, ABA also highlighted the need to make changes to assessment areas to account for digital banking trends, include both quantitative and qualitative assessments, reduce overall complexity and be mindful of excessive data burdens or new reporting requirements.