The Board of Governors of the Federal Reserve System (FED) approved merger and acquisition applications involving Texas State Bankshares, Inc., Texas Regional Bank, Alerus Financial Corporation, and MidWestOne Financial Group, Inc. Additionally, the US regulatory agencies are seeking feedback, until August 05, 2022, on a proposal to strengthen and modernize the regulations implementing the Community Reinvestment Act (CRA).
The US agencies seek feedback on changes to update and clarify the regulations to implement the CRA and proposed a new evaluation framework for evaluating CRA performance for banks that would establish the following four tests for large banks—Retail Lending Test, Retail Services and Products Test, Community Development Financing Test, and Community Development Services Test. Intermediate banks would be evaluated under the Retail Lending Test and the status quo community development test, unless they choose to opt into the Community Development Financing Test. Small banks would be evaluated under the status quo small bank lending test, unless they choose to opt into the Retail Lending Test. Wholesale and limited purpose banks would be evaluated under a tailored version of the Community Development Financing Test. The proposal aimed at updating the CRA regulations involves:
- updating CRA regulations to strengthen the achievement of the core purpose of the statute
- adapting to changes in the banking industry, including the expanded role of mobile and online banking
- providing greater clarity and consistency in the application of the regulations
- tailoring performance standards to account for differences in bank size and business models and local conditions
- tailoring data collection and reporting requirements and use existing data whenever possible
- promoting transparency and public engagement
- confirming that CRA and fair lending responsibilities are mutually reinforcing
- creating a consistent regulatory approach that applies to banks regulated by all three agencies
- Press Release on Community Reinvestment Act
- Federal Register: Community Reinvestment Act
- Press Release on Texas State Bankshares, Inc. and Texas Regional Bank
- Press Release on Alerus Financial Corporation
- Press Release on MidWestOne Financial Group, Inc.
Keywords: Americas, US, Banking, Mergers and Acquisitions, Community Reinvestment Act, Lending, Small Banks, Retail Lending, Reporting, US Agencies, FED, FDIC, OCC
Previous ArticleFINMA Issues Guidance on LIBOR Replacement
The Australian Prudential Regulation Authority (APRA) has published the findings of its latest climate risk self-assessment survey conducted across the banking, insurance, and superannuation industries.
The French Prudential Supervisory Authority (ACPR) published a notice related to the methods for calculating and publishing prudential ratios under the Capital Requirements Directive (CRD IV) and the minimum requirement for own funds and eligible liabilities (MREL).
The Financial Stability Institute (FSI) of the Bank for International Settlements recently published a paper proposing a framework for classifying financial stability regulation as either entity-based or activity-based.
The European Insurance and Occupational Pension Authority (EIOPA) published the risk dashboard based on Solvency II data and the final version of the application guidance on climate change materiality assessments and climate change scenarios in the Own Risk and Solvency Assessment (ORSA).
The European Banking Authority (EBA) and the European Central Bank (ECB) published their responses to the consultations of the International Sustainability Standards Board (ISSB) and the European Financial Reporting Advisory Group (EFRAG) on sustainability-related disclosure standards.
A Consultative Group on Risk Management (CGRM) at the Bank for International Settlements (BIS) published a report that examines incorporation of climate risks into the international reserve management framework.
The European Banking Authority (EBA) published the final guidelines on liquidity requirements exemption for investment firms, updated version of its 5.2 filing rules document for supervisory reporting, and Single Rulebook Question and Answer (Q&A) updates in July 2022.
The European Insurance and Occupational Pensions Authority (EIOPA) published Version 2.8.0 of the Solvency II data point model (DPM) and XBRL taxonomy.
The European Union published, in the Official Journal of the European Union, an opinion from the European Economic and Social Committee (EESC); the opinion is on the proposal for a regulation to amend the Capital Requirements Regulation (CRR).
HM Treasury published a draft statutory instrument titled “The Financial Services (Miscellaneous Amendments) (EU Exit) Regulations 2022,” along with the related explanatory memorandum and impact assessment.