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Common Issues Noted in Community Reinvestment Act Public Files

Dec 18, 2017

The Community Reinvestment Act (CRA) lays out specific information that must be contained in a bank’s public file at its main office. If the bank is located in multiple states (an interstate bank), CRA public files must be maintained at one branch office in each state. In addition, other branch locations must maintain a copy of the public section of the bank’s most recent CRA Performance Evaluation and a list of services provided by the branch and must be able to provide, within five calendar days of a request, all of the information in the public file relating to the assessment area in which the branch is located. These requirements can be found in the following citations:
12 CFR 25.43 for OCC-regulated banks
12 CFR 228.43 for Federal Reserve-regulated banks
12 CFR 345.23 for FDIC-regulated banks

One of the required items for the main office, and if it is an interstate bank, at one branch office in each state, is a list of the bank's branches, street addresses, and geographies. When we look for this information in public files, it is not uncommon to find geographies are not included. Geography means a census tract delineated by the United States Bureau of the Census in the most recent decennial census. Geographies can be obtained by typing a branch’s address into the Federal Financial Institutions Examination Council’s (FFIEC’s) Geocoding/Mapping System at 

For example, in the “Address” bar at the top of the page, if you type in Wipfli’s office address of 8665 Hudson Boulevard North, St. Paul, MN 55042, the website returns the results of Tract Code 0704.06. It is this Census Tract Code information that should be listed as part of the branch’s location. Keep in mind that census tract information on its own is not as helpful as listing all of a branch’s geographical information, which includes the MSA/MD Code, State Code, County Code, and Tract Code. All of these codes are included in the results of the location search in the link above. Printing the results page and attaching it to the list of branches is an easy way to provide this information.

Geography is also required on the list of branches opened or closed by the bank during the current year and each of the prior two calendar years, along with each branch’s street address.  Not having the geography information on this list is also a common finding during audits and examinations.

Small banks must include their loan-to-deposit ratio for each quarter of the prior calendar year at the main office, and if an interstate bank, at one branch office in each state. Though we typically find this information in files we review, the calculations are often incorrect. The following Call Report line item information should be used for these calculations:

   RC 4a (Loans and leases held for sale) 
+ RC 4b (Loans and leases held for investment)
-  RC 4c (Allowance for loan and lease losses) 

=  Net Loans and Leases, then

/ RC 13 (Deposits)
= The Loan-to-Deposit Ratio that should be listed in the public file

The other issue we often observe for banks subject to the Home Mortgage Disclosure Act (HMDA) is that the most recent HMDA disclosure statement provided by the FFIEC is not placed in public files in a timely manner. The CRA requires public files at the main office, and if the bank is an interstate bank, at one branch office in each state, to contain a HMDA disclosure statement for each of the prior two calendar years when those statements are not available on the Consumer Financial Protection Bureau’s (CFPB’s) website. The bank must place the disclosure statement in its public files within three business days after its receipt.  

As of January 1, 2018, Regulation C no longer requires banks to provide HMDA disclosure statements directly to the public. Instead banks may provide a notice that clearly conveys to the public that they can obtain a copy of the disclosure statement on the CFPB’s website. Banks that are required to report HMDA data need only maintain the notice required under Section 1003.5(b) of Regulation C in their CRA public file, rather than a copy of the HMDA disclosure statement.

Banks must ensure the information required to be in CRA public files is current as of April 1 of each year, so be sure this is on someone’s to-do list for the first quarter of 2018. A complete list of what is required to be in CRA public files can be found in the primary regulator citations listed above.