12 C.F.R. PART 563e—COMMUNITY REINVESTMENT
Title 12 - Banks and Banking
Authority: 12 U.S.C. 1462a, 1463, 1464, 1467a, 1814, 1816, 1828(c), and 2901 through 2907.
Source: 54 FR 49635, Nov. 30, 1989, unless otherwise noted.
Source: 60 FR 22212, May 4, 1995, unless otherwise noted.
(a) Authority and OMB control number—(1) Authority. This part is issued under the Community Reinvestment Act of 1977 (CRA), as amended (12 U.S.C. 2901 et seq.); section 5, as amended, and sections 3, 4, and 10, as added, of the Home Owners' Loan Act of 1933 (12 U.S.C. 1462a, 1463, 1464, and 1467a); and sections 4, 6, and 18(c), as amended of the Federal Deposit Insurance Act (12 U.S.C. 1814, 1816, 1828(c)). (2) OMB control number. The information collection requirements contained in this part were approved by the Office of Management and Budget under the provisions of 44 U.S.C. 3501 et seq. and have been assigned OMB control number 1550–0012. (b) Purposes. In enacting the CRA, the Congress required each appropriate Federal financial supervisory agency to assess an institution's record of helping to meet the credit needs of the local communities in which the institution is chartered, consistent with the safe and sound operation of the institution, and to take this record into account in the agency's evaluation of an application for a deposit facility by the institution. This part is intended to carry out the purposes of the CRA by: (1) Establishing the framework and criteria by which the OTS assesses a savings association's record of helping to meet the credit needs of its entire community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of the savings association; and (2) Providing that the OTS takes that record into account in considering certain applications. (c) Scope—(1) General. This part applies to all savings associations except as provided in paragraph (c)(2) of this section. (2) Certain special purpose savings associations. This part does not apply to special purpose savings associations that do not perform commercial or retail banking services by granting credit to the public in the ordinary course of business, other than as incident to their specialized operations. These associations include banker's banks, as defined in 12 U.S.C. 24 (Seventh), and associations that engage only in one or more of the following activities: providing cash management controlled disbursement services or serving as correspondent associations, trust companies, or clearing agents. [60 FR 22212, May 4, 1995, as amended at 62 FR 67708, Dec. 30, 1997] For purposes of this part, the following definitions apply: (a) Affiliate means any company that controls, is controlled by, or is under common control with another company. The term “control” has the meaning given to that term in 12 U.S.C. 1841(a)(2), and a company is under common control with another company if both companies are directly or indirectly controlled by the same company. (b) Area median income means: (1) The median family income for the MSA, if a person or geography is located in an MSA, or for the metropolitan division, if a person or geography is located in an MSA that has been subdivided into metropolitan divisions; or (2) The statewide nonmetropolitan median family income, if a person or geography is located outside an MSA. (c) Assessment area means a geographic area delineated in accordance with §563e.41. (d) Automated teller machine (ATM) means an automated, unstaffed banking facility owned or operated by, or operated exclusively for, the savings association at which deposits are received, cash dispersed, or money lent. (e) [Reserved] (f) Branch means a staffed banking facility authorized as a branch, whether shared or unshared, including, for example, a mini-branch in a grocery store or a branch operated in conjunction with any other local business or nonprofit organization. (g) Community development means: (1) Affordable housing (including multifamily rental housing) for low or moderate-income individuals; (2) Community services targeted to low- or moderate-income individuals; (3) Activities that promote economic development by financing businesses or farms that meet the size eligibility standards of the Small Business Administration's Development Company or Small Business Investment Company programs (13 CFR 121.301) or have gross annual revenues of $1 million or less; or (4) Activities that revitalize or stabilize— (i) Low- or moderate-income geographies; (ii) Designated disaster areas; or (iii) Distressed or underserved, nonmetropolitan middle-income geographies designated by OTS based on— (A) Rates of poverty, unemployment, and population loss; or (B) Population size, density, and dispersion. Activities revitalize and stabilize geographies designated based on population size, density, and dispersion if they help to meet essential community needs, including needs of low- and moderate-income individuals. (h) Community development loan means a loan that: (1) Has as its primary purpose community development; and (2) Except in the case of a wholesale or limited purpose savings association: (i) Has not been reported or collected by the savings association or an affiliate for consideration in the savings association's assessment as a home mortgage, small business, small farm, or consumer loan, unless it is a multifamily dwelling loan (as described in Appendix A to Part 203 of this title); and (ii) Benefits the savings association's assessment area(s) or a broader statewide or regional area that includes the savings association's assessment area(s). (i) Community development service means a service that: (1) Has as its primary purpose community development; (2) Is related to the provision of financial services; and (3) Has not been considered in the evaluation of the savings association's retail banking services under §563e.24(d). (j) Consumer loan means a loan to one or more individuals for household, family, or other personal expenditures. A consumer loan does not include a home mortgage, small business, or small farm loan. Consumer loans include the following categories of loans: (1) Motor vehicle loan, which is a consumer loan extended for the purchase of and secured by a motor vehicle; (2) Credit card loan, which is a line of credit for household, family, or other personal expenditures that is accessed by a borrower's use of a “credit card,” as this term is defined in §226.2 of this title; (3) Home equity loan, which is a consumer loan secured by a residence of the borrower; (4) Other secured consumer loan, which is a secured consumer loan that is not included in one of the other categories of consumer loans; and (5) Other unsecured consumer loan, which is an unsecured consumer loan that is not included in one of the other categories of consumer loans. (k) Geography means a census tract delineated by the United States Bureau of the Census in the most recent decennial census. (l) Home mortgage loan means a “home improvement loan,” “home purchase loan,” or a “refinancing” as defined in §203.2 of this title. (m) Income level includes: (1) Low-income, which means an individual income that is less than 50 percent of the area median income or a median family income that is less than 50 percent in the case of a geography. (2) Moderate-income, which means an individual income that is at least 50 percent and less than 80 percent of the area median income or a median family income that is at least 50 and less than 80 percent in the case of a geography. (3) Middle-income, which means an individual income that is at least 80 percent and less than 120 percent of the area median income or a median family income that is at least 80 and less than 120 percent in the case of a geography. (4) Upper-income, which means an individual income that is 120 percent or more of the area median income or a median family income that is 120 percent or more in the case of a geography. (n) Limited purpose savings association means a savings association that offers only a narrow product line (such as credit card or motor vehicle loans) to a regional or broader market and for which a designation as a limited purpose savings association is in effect, in accordance with §563e.25(b). (o) Loan location. A loan is located as follows: (1) A consumer loan is located in the geography where the borrower resides; (2) A home mortgage loan is located in the geography where the property to which the loan relates is located; and (3) A small business or small farm loan is located in the geography where the main business facility or farm is located or where the loan proceeds otherwise will be applied, as indicated by the borrower. (p) Loan production office means a staffed facility, other than a branch, that is open to the public and that provides lending-related services, such as loan information and applications. (q) Metropolitan division means a metropolitan division as defined by the Director of the Office of Management and Budget. (r) MSA means a metropolitan statistical area as defined by the Director of the Office of Management and Budget. (s) Nonmetropolitan area means any area that is not located in an MSA. (t) Qualified investment means a lawful investment, deposit, membership share, or grant that has as its primary purpose community development. (u) Small savings association means a savings association that, as of December 31 of either of the prior two calendar years, had total assets of less than $1 billion. (v) Small business loan means a loan included in “loans to small businesses” as defined in the instructions for preparation of the Thrift Financial Report. (w) Small farm loan means a loan included in “loans to small farms” as defined in the instructions for preparation of the Thrift Financial Report. (x) Wholesale savings association means a savings association that is not in the business of extending home mortgage, small business, small farm, or consumer loans to retail customers, and for which a designation as a wholesale savings association is in effect, in accordance with §563e.25(b). [60 FR 22212, May 4, 1995, as amended at 60 FR 66050, Dec. 20, 1995; 61 FR 21364, May 10, 1996; 69 FR 41188, July 8, 2004; 69 FR 51161, Aug. 18, 2004; 71 FR 18618, Apr. 12, 2006] Source: 60 FR 22213, May 4, 1995, unless otherwise noted.
(a) Performance tests and standards. The OTS assesses the CRA performance of a savings association in an examination as follows: (1) Lending, investment, and service tests. The OTS applies the lending, investment, and service tests, as provided in §§563e.22 through 563e.24, in evaluating the performance of a savings association, except as provided in paragraphs (a)(2), (a)(3), and (a)(4) of this section, and to the extent consistent with §563e.28(d). (2) Community development test for wholesale or limited purpose savings associations. The OTS applies the community development test for a wholesale or limited purpose savings association, as provided in §563e.25, except as provided in paragraph (a)(4) of this section. (3) Small savings association performance standards. The OTS applies the small savings association performance standards as provided in §563e.26 in evaluating the performance of a small savings association or a savings association that was a small savings association during the prior calendar year, unless the savings association elects to be assessed as provided in paragraphs (a)(1), (a)(2), or (a)(4) of this section. The savings association may elect to be assessed as provided in paragraph (a)(1) of this section only if it collects and reports the data required for other savings associations under §563e.42. (4) Strategic plan. The OTS evaluates the performance of a savings association under a strategic plan if the savings association submits, and the OTS approves, a strategic plan as provided in §563e.27. (b) Performance context. The OTS applies the tests and standards in paragraph (a) of this section and also considers whether to approve a proposed strategic plan in the context of: (1) Demographic data on median income levels, distribution of household income, nature of housing stock, housing costs, and other relevant data pertaining to a savings association's assessment area(s); (2) Any information about lending, investment, and service opportunities in the savings association's assessment area(s) maintained by the savings association or obtained from community organizations, state, local, and tribal governments, economic development agencies, or other sources; (3) The savings association's product offerings and business strategy as determined from data provided by the savings association; (4) Institutional capacity and constraints, including the size and financial condition of the savings association, the economic climate (national, regional, and local), safety and soundness limitations, and any other factors that significantly affect the savings association's ability to provide lending, investments, or services in its assessment area(s); (5) The savings association's past performance and the performance of similarly situated lenders; (6) The savings association's public file, as described in §563e.43, and any written comments about the savings association's CRA performance submitted to the savings association or the OTS; and (7) Any other information deemed relevant by the OTS. (c) Assigned ratings. The OTS assigns to a savings association one of the following four ratings pursuant to §563e.28 and Appendix A of this part: “outstanding”; “satisfactory”; “needs to improve”; or “substantial noncompliance,” as provided in 12 U.S.C. 2906(b)(2). The rating assigned by the OTS reflects the savings association's record of helping to meet the credit needs of its entire community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of the savings association. (d) Safe and sound operations. This part and the CRA do not require a savings association to make loans or investments or to provide services that are inconsistent with safe and sound operations. To the contrary, the OTS anticipates savings associations can meet the standards of this part with safe and sound loans, investments, and services on which the savings associations expect to make a profit. Savings associations are permitted and encouraged to develop and apply flexible underwriting standards for loans that benefit low- or moderate-income geographies or individuals, only if consistent with safe and sound operations. [60 FR 22213, May 4, 1995, as amended at 70 FR 10030, Mar. 2, 2005] (a) Scope of test. (1) The lending test evaluates a savings association's record of helping to meet the credit needs of its assessment area(s) through its lending activities by considering a savings association's home mortgage, small business, small farm, and community development lending. If consumer lending constitutes a substantial majority of a savings association's business, the OTS will evaluate the savings association's consumer lending in one or more of the following categories: motor vehicle, credit card, home equity, other secured, and other unsecured loans. In addition, at a savings association's option, the OTS will evaluate one or more categories of consumer lending, if the savings association has collected and maintained, as required in §563e.42(c)(1), the data for each category that the savings association elects to have the OTS evaluate. (2) The OTS considers originations and purchases of loans. The OTS will also consider any other loan data the savings association may choose to provide, including data on loans outstanding, commitments and letters of credit. (3) A savings association may ask the OTS to consider loans originated or purchased by consortia in which the savings association participates or by third parties in which the savings association has invested only if the loans meet the definition of community development loans and only in accordance with paragraph (d) of this section. The OTS will not consider these loans under any criterion of the lending test except the community development lending criterion. (b) Performance criteria. The OTS evaluates a savings association's lending performance pursuant to the following criteria: (1) Lending activity. The number and amount of the savings association's home mortgage, small business, small farm, and consumer loans, if applicable, in the savings association's assessment area(s); (2) Geographic distribution. The geographic distribution of the savings association's home mortgage, small business, small farm, and consumer loans, if applicable, based on the loan location, including: (i) The proportion of the savings association's lending in the savings association's assessment area(s); (ii) The dispersion of lending in the savings association's assessment area(s); and (iii) The number and amount of loans in low-, moderate-, middle-, and upper-income geographies in the savings association's assessment area(s); (3) Borrower characteristics. The distribution, particularly in the savings association's assessment area(s), of the savings association's home mortgage, small business, small farm, and consumer loans, if applicable, based on borrower characteristics, including the number and amount of: (i) Home mortgage loans to low-, moderate-, middle-, and upper-income individuals; (ii) Small business and small farm loans to businesses and farms with gross annual revenues of $1 million or less; (iii) Small business and small farm loans by loan amount at origination; and (iv) Consumer loans, if applicable, to low-, moderate-, middle-, and upper-income individuals; (4) Community development lending. The savings association's community development lending, including the number and amount of community development loans, and their complexity and innovativeness; and (5) Innovative or flexible lending practices. The savings association's use of innovative or flexible lending practices in a safe and sound manner to address the credit needs of low- or moderate-income individuals or geographies. (c) Affiliate lending. (1) At a savings association's option, the OTS will consider loans by an affiliate of the savings association, if the savings association provides data on the affiliate's loans pursuant to §563e.42. (2) The OTS considers affiliate lending subject to the following constraints: (i) No affiliate may claim a loan origination or loan purchase if another institution claims the same loan origination or purchase; and (ii) If a savings association elects to have the OTS consider loans within a particular lending category made by one or more of the savings association's affiliates in a particular assessment area, the savings association shall elect to have the OTS consider, in accordance with paragraph (c)(1) of this section, all the loans within that lending category in that particular assessment area made by all of the savings association's affiliates. (3) The OTS does not consider affiliate lending in assessing a savings association's performance under paragraph (b)(2)(i) of this section. (d) Lending by a consortium or a third party. Community development loans originated or purchased by a consortium in which the savings association participates or by a third party in which the savings association has invested: (1) Will be considered, at the savings association's option, if the savings association reports the data pertaining to these loans under §563e.42(b)(2); and (2) May be allocated among participants or investors, as they choose, for purposes of the lending test, except that no participant or investor: (i) May claim a loan origination or loan purchase if another participant or investor claims the same loan origination or purchase; or (ii) May claim loans accounting for more than its percentage share (based on the level of its participation or investment) of the total loans originated by the consortium or third party. (e) Lending performance rating. The OTS rates a savings association's lending performance as provided in Appendix A of this part. (a) Scope of test. The investment test evaluates a savings association's record of helping to meet the credit needs of its assessment area(s) through qualified investments that benefit its assessment area(s) or a broader statewide or regional area that includes the savings association's assessment area(s). (b) Exclusion. Activities considered under the lending or service tests may not be considered under the investment test. (c) Affiliate investment. At a savings association's option, the OTS will consider, in its assessment of a savings association's investment performance, a qualified investment made by an affiliate of the savings association, if the qualified investment is not claimed by any other institution. (d) Disposition of branch premises. Donating, selling on favorable terms, or making available on a rent-free basis a branch of the savings association that is located in a predominantly minority neighborhood to a minority depository institution or women's depository institution (as these terms are defined in 12 U.S.C. 2907(b)) will be considered as a qualified investment. (e) Performance criteria. The OTS evaluates the investment performance of a savings association pursuant to the following criteria: (1) The dollar amount of qualified investments; (2) The innovativeness or complexity of qualified investments; (3) The responsiveness of qualified investments to credit and community development needs; and (4) The degree to which the qualified investments are not routinely provided by private investors. (f) Investment performance rating. The OTS rates a savings association's investment performance as provided in Appendix A of this part. (a) Scope of test. The service test evaluates a savings association's record of helping to meet the credit needs of its assessment area(s) by analyzing both the availability and effectiveness of a savings association's systems for delivering retail banking services and the extent and innovativeness of its community development services. (b) Area(s) benefitted. Community development services must benefit a savings association's assessment area(s) or a broader statewide or regional area that includes the savings association's assessment area(s). (c) Affiliate service. At a savings association's option, the OTS will consider, in its assessment of a savings association's service performance, a community development service provided by an affiliate of the savings association, if the community development service is not claimed by any other institution. (d) Performance criteria—retail banking services. The OTS evaluates the availability and effectiveness of a savings association's systems for delivering retail banking services, pursuant to the following criteria: (1) The current distribution of the savings association's branches among low-,moderate-, middle-, and upper-income geographies; (2) In the context of its current distribution of the savings association's branches, the savings association's record of opening and closing branches, particularly branches located in low- or moderate-income geographies or primarily serving low- or moderate-income individuals; (3) The availability and effectiveness of alternative systems for delivering retail banking services (e.g., ATMs, ATMs not owned or operated by or exclusively for the savings association, banking by telephone or computer, loan production offices, and bank-at-work or bank-by-mail programs) in low- and moderate-income geographies and to low- and moderate-income individuals; and (4) The range of services provided in low-, moderate-, middle-, and upper-income geographies and the degree to which the services are tailored to meet the needs of those geographies. (e) Performance criteria—community development services. The OTS evaluates community development services pursuant to the following criteria: (1) The extent to which the savings association provides community development services; and (2) The innovativeness and responsiveness of community development services. (f) Service performance rating. The OTS rates a savings association's service performance as provided in Appendix A of this part. (a) Scope of test. The OTS assesses a wholesale or limited purpose savings association's record of helping to meet the credit needs of its assessment area(s) under the community development test through its community development lending, qualified investments, or community development services. (b) Designation as a wholesale or limited purpose savings association. In order to receive a designation as a wholesale or limited purpose savings association, a savings association shall file a request, in writing, with the OTS, at least three months prior to the proposed effective date of the designation. If the OTS approves the designation, it remains in effect until the savings association requests revocation of the designation or until one year after the OTS notifies the savings association that the OTS has revoked the designation on its own initiative. (c) Performance criteria. The OTS evaluates the community development performance of a wholesale or limited purpose savings association pursuant to the following criteria: (1) The number and amount of community development loans (including originations and purchases of loans and other community development loan data provided by the savings association, such as data on loans outstanding, commitments, and letters of credit), qualified investments, or community development services; (2) The use of innovative or complex qualified investments, community development loans, or community development services and the extent to which the investments are not routinely provided by private investors; and (3) The savings association's responsiveness to credit and community development needs. (d) Indirect activities. At a savings association's option, the OTS will consider in its community development performance assessment: (1) Qualified investments or community development services provided by an affiliate of the savings association, if the investments or services are not claimed by any other institution; and (2) Community development lending by affiliates, consortia and third parties, subject to the requirements and limitations in §563e.22 (c) and (d). (e) Benefit to assessment area(s)—(1) Benefit inside assessment area(s). The OTS considers all qualified investments, community development loans, and community development services that benefit areas within the savings association's assessment area(s) or a broader statewide or regional area that includes the savings association's assessment area(s). (2) Benefit outside assessment area(s). The OTS considers the qualified investments, community development loans, and community development services that benefit areas outside the savings association's assessment area(s), if the savings association has adequately addressed the needs of its assessment area(s). (f) Community development performance rating. The OTS rates a savings association's community development performance as provided in Appendix A of this part. (a) Performance criteria. The OTS evaluates the record of a small savings association, or a savings association that was a small savings association during the prior calendar year, of helping to meet the credit needs of its assessment area(s) pursuant to the following criteria: (1) The savings association's loan-to-deposit ratio, adjusted for seasonal variation and, as appropriate, other lending-related activities, such as loan originations for sale to the secondary markets, community development loans, or qualified investments; (2) The percentage of loans and, as appropriate, other lending-related activities located in the savings association's assessment area(s); (3) The savings association's record of lending to and, as appropriate, engaging in other lending-related activities for borrowers of different income levels and businesses and farms of different sizes; (4) The geographic distribution of the savings association's loans; and (5) The savings association's record of taking action, if warranted, in response to written complaints about its performance in helping to meet credit needs in its assessment area(s). (b) Small savings association performance rating. The OTS rates the performance of a savings association evaluated under this section as provided in Appendix A of this part. (a) Alternative election. The OTS will assess a savings association's record of helping to meet the credit needs of its assessment area(s) under a strategic plan if: (1) The savings association has submitted the plan to the OTS as provided for in this section; (2) The OTS has approved the plan; (3) The plan is in effect; and (4) The savings association has been operating under an approved plan for at least one year. (b) Data reporting. The OTS's approval of a plan does not affect the savings association's obligation, if any, to report data as required by §563e.42. (c) Plans in general—(1) Term. A plan may have a term of no more than five years, and any multi-year plan must include annual interim measurable goals under which the OTS will evaluate the savings association's performance. (2) Multiple assessment areas. A savings association with more than one assessment area may prepare a single plan for all of its assessment areas or one or more plans for one or more of its assessment areas. (3) Treatment of affiliates. Affiliated institutions may prepare a joint plan if the plan provides measurable goals for each institution. Activities may be allocated among institutions at the institutions' option, provided that the same activities are not considered for more than one institution. (d) Public participation in plan development. Before submitting a plan to the OTS for approval, a savings association shall: (1) Informally seek suggestions from members of the public in its assessment area(s) covered by the plan while developing the plan; (2) Once the savings association has developed a plan, formally solicit public comment on the plan for at least 30 days by publishing notice in at least one newspaper of general circulation in each assessment area covered by the plan; and (3) During the period of formal public comment, make copies of the plan available for review by the public at no cost at all offices of the savings association in any assessment area covered by the plan and provide copies of the plan upon request for a reasonable fee to cover copying and mailing, if applicable. (e) Submission of plan. The savings association shall submit its plan to the OTS at least three months prior to the proposed effective date of the plan. The savings association shall also submit with its plan a description of its informal efforts to seek suggestions from members of the public, any written public comment received, and, if the plan was revised in light of the comment received, the initial plan as released for public comment. (f) Plan content—(1) Measurable goals. (i) A savings association shall specify in its plan measurable goals for helping to meet the credit needs of each assessment area covered by the plan, particularly the needs of low- and moderate-income geographies and low- and moderate-income individuals, through lending, investment, and services, as appropriate. (ii) A savings association shall address in its plan all three performance categories and, unless the savings association has been designated as a wholesale or limited purpose savings association, shall emphasize lending and lending-related activities. Nevertheless, a different emphasis, including a focus on one or more performance categories, may be appropriate if responsive to the characteristics and credit needs of its assessment area(s), considering public comment and the savings association's capacity and constraints, product offerings, and business strategy. (2) Confidential information. A savings association may submit additional information to the OTS on a confidential basis, but the goals stated in the plan must be sufficiently specific to enable the public and the OTS to judge the merits of the plan. (3) Satisfactory and outstanding goals. A savings association shall specify in its plan measurable goals that constitute “satisfactory” performance. A plan may specify measurable goals that constitute “outstanding” performance. If a savings association submits, and the OTS approves, both “satisfactory” and “outstanding” performance goals, the OTS will consider the savings association eligible for an “outstanding” performance rating. (4) Election if satisfactory goals not substantially met. A savings association may elect in its plan that, if the savings association fails to meet substantially its plan goals for a satisfactory rating, the OTS will evaluate the savings association's performance under the lending, investment, and service tests, the community development test, or the small savings association performance standards, as appropriate. (g) Plan approval—(1) Timing. The OTS will act upon a plan within 60 calendar days after the OTS receives the complete plan and other material required under paragraph (e) of this section. If the OTS fails to act within this time period, the plan shall be deemed approved unless the OTS extends the review period for good cause. (2) Public participation. In evaluating the plan's goals, the OTS considers the public's involvement in formulating the plan, written public comment on the plan, and any response by the savings association to public comment on the plan. (3) Criteria for evaluating plan. The OTS evaluates a plan's measurable goals using the following criteria, as appropriate: (i) The extent and breadth of lending or lending-related activities, including, as appropriate, the distribution of loans among different geographies, businesses and farms of different sizes, and individuals of different income levels, the extent of community development lending, and the use of innovative or flexible lending practices to address credit needs; (ii) The amount and innovativeness, complexity, and responsiveness of the savings association's qualified investments; and (iii) The availability and effectiveness of the savings association's systems for delivering retail banking services and the extent and innovativeness of the savings association's community development services. (h) Plan amendment. During the term of a plan, a savings association may request the OTS to approve an amendment to the plan on grounds that there has been a material change in circumstances. The savings association shall develop an amendment to a previously approved plan in accordance with the public participation requirements of paragraph (d) of this section. (i) Plan assessment. The OTS approves the goals and assesses performance under a plan as provided for in Appendix A of this part. [60 FR 22216, May 4, 1995, as amended at 60 FR 66050, Dec. 20, 1995; 69 FR 41188, July 8, 2004] (a) Ratings in general. Subject to paragraphs (b), (c), and (d) of this section, the OTS assigns to a savings association a rating of “outstanding,” “satisfactory,” “needs to improve,” or “substantial noncompliance” based on the savings association's performance under the lending, investment and service tests, the community development test, the small savings association performance standards, or an approved strategic plan, as applicable. (b) Lending, investment, and service tests. The OTS assigns a rating for a savings association assessed under the lending, investment, and service tests in accordance with the following principles: (1) A savings association that receives an “outstanding” rating on the lending test receives an assigned rating of at least “satisfactory”; (2) A savings association that receives an “outstanding” rating on both the service test and the investment test and a rating of at least “high satisfactory” on the lending test receives an assigned rating of “outstanding”; and (3) No savings association may receive an assigned rating of “satisfactory” or higher unless it receives a rating of at least “low satisfactory” on the lending test. (c) Effect of evidence of discriminatory or other illegal credit practices. Evidence of discriminatory or other illegal credit practices adversely affects the OTS's evaluation of a savings association's performance. In determining the effect on the savings association's assigned rating, the OTS considers the nature and extent of the evidence, the policies and procedures that the savings association has in place to prevent discriminatory or other illegal credit practices, any corrective action that the savings association has taken or has committed to take, particularly voluntary corrective action resulting from self-assessment, and other relevant information. (d) Savings associations electing alternative weights of lending, investment, and service. A savings association subject to the lending, investment, and service tests may elect alternative weights for lending, service, and investment. The principles in paragraph (b) of this section do not apply to the extent of any inconsistency with the alternative weights selected. [60 FR 22213, May 4, 1995, as amended at 70 FR 10030, Mar. 2, 2005] (a) CRA performance. Among other factors, the OTS takes into account the record of performance under the CRA of each applicant savings association, and for applications under section 10(e) of the Home Owners' Loan Act (12 U.S.C. 1467a(e)), of each proposed subsidiary savings association, in considering an application for: (1) The establishment of a domestic branch or other facility that would be authorized to take deposits; (2) The relocation of the main office or a branch; (3) The merger or consolidation with or the acquisition of the assets or assumption of the liabilities of an insured depository institution requiring OTS approval under the Bank Merger Act (12 U.S.C. 1828(c)); (4) A Federal thrift charter; and (5) Acquisitions subject to section 10(e) of the Home Owners' Loan Act (12 U.S.C. 1467a(e)). (b) Charter application. An applicant for a Federal thrift charter shall submit with its application a description of how it will meet its CRA objectives. The OTS takes the description into account in considering the application and may deny or condition approval on that basis. (c) Interested parties. The OTS takes into account any views expressed by interested parties that are submitted in accordance with the applicable comment procedures in considering CRA performance in an application listed in paragraphs (a) and (b) of this section. (d) Denial or conditional approval of application. A savings association's record of performance may be the basis for denying or conditioning approval of an application listed in paragraph (a) of this section. (e) Insured depository institution. For purposes of this section, the term “insured depository institution” has the meaning given to that term in 12 U.S.C. 1813. Source: 60 FR 22217, May 4, 1995, unless otherwise noted.
(a) In general. A savings association shall delineate one or more assessment areas within which the OTS evaluates the savings association's record of helping to meet the credit needs of its community. The OTS does not evaluate the savings association's delineation of its assessment area(s) as a separate performance criterion, but the OTS reviews the delineation for compliance with the requirements of this section. (b) Geographic area(s) for wholesale or limited purpose savings associations. The assessment area(s) for a wholesale or limited purpose savings association must consist generally of one or more MSAs or metropolitan divisions (using the MSA or metropolitan division boundaries that were in effect as of January 1 of the calendar year in which the delineation is made) or one or more contiguous political subdivisions, such as counties, cities, or towns, in which the savings association has its main office, branches, and deposit-taking ATMs. (c) Geographic area(s) for other savings associations. The assessment area(s) for a savings association other than a wholesale or limited purpose savings association must: (1) Consist generally of one or more MSAs or metropolitan divisions (using the MSA or metropolitan division boundaries that were in effect as of January 1 of the calendar year in which the delineation is made) or one or more contiguous political subdivisions, such as counties, cities, or towns; and (2) Include the geographies in which the savings association has its main office, its branches, and its deposit-taking ATMs, as well as the surrounding geographies in which the savings association has originated or purchased a substantial portion of its loans (including home mortgage loans, small business and small farm loans, and any other loans the savings association chooses, such as those consumer loans on which the savings association elects to have its performance assessed). (d) Adjustments to geographic area(s). A savings association may adjust the boundaries of its assessment area(s) to include only the portion of a political subdivision that it reasonably can be expected to serve. An adjustment is particularly appropriate in the case of an assessment area that otherwise would be extremely large, of unusual configuration, or divided by significant geographic barriers. (e) Limitations on the delineation of an assessment area. Each savings association's assessment area(s): (1) Must consist only of whole geographies; (2) May not reflect illegal discrimination; (3) May not arbitrarily exclude low- or moderate-income geographies, taking into account the savings association's size and financial condition; and (4) May not extend substantially beyond an MSA boundary or beyond a state boundary unless the assessment area is located in a multistate MSA. If a savings association serves a geographic area that extends substantially beyond a state boundary, the savings association shall delineate separate assessment areas for the areas in each state. If a savings association serves a geographic area that extends substantially beyond an MSA boundary, the savings association shall delineate separate assessment areas for the areas inside and outside the MSA. (f) Savings associations serving military personnel. Notwithstanding the requirements of this section, a savings association whose business predominantly consists of serving the needs of military personnel or their dependents who are not located within a defined geographic area may delineate its entire deposit customer base as its assessment area. (g) Use of assessment area(s). The OTS uses the assessment area(s) delineated by a savings association in its evaluation of the savings association's CRA performance unless the OTS determines that the assessment area(s) do not comply with the requirements of this section. [60 FR 22217, May 4, 1995, as amended at 69 FR 41188, July 8, 2004] (a) Loan information required to be collected and maintained. A savings association, except a small savings association, shall collect, and maintain in machine readable form (as prescribed by the OTS) until the completion of its next CRA examination, the following data for each small business or small farm loan originated or purchased by the savings association: (1) A unique number or alpha-numeric symbol that can be used to identify the relevant loan file; (2) The loan amount at origination; (3) The loan location; and (4) An indicator whether the loan was to a business or farm with gross annual revenues of $1 million or less. (b) Loan information required to be reported. A savings association, except a small savings association or a savings association that was a small savings association during the prior calendar year, shall report annually by March 1 to the OTS in machine readable form (as prescribed by the OTS) the following data for the prior calendar year: (1) Small business and small farm loan data. For each geography in which the savings association originated or purchased a small business or small farm loan, the aggregate number and amount of loans: (i) With an amount at origination of $100,000 or less; (ii) With amount at origination of more than $100,000 but less than or equal to $250,000; (iii) With an amount at origination of more than $250,000; and (iv) To businesses and farms with gross annual revenues of $1 million or less (using the revenues that the savings association considered in making its credit decision); (2) Community development loan data. The aggregate number and aggregate amount of community development loans originated or purchased; and (3) Home mortgage loans. If the savings association is subject to reporting under part 203 of this title, the location of each home mortgage loan application, origination, or purchase outside the MSAs in which the savings association has a home or branch office (or outside any MSA) in accordance with the requirements of part 203 of this title. (c) Optional data collection and maintenance—(1) Consumer loans. A savings association may collect and maintain in machine readable form (as prescribed by the OTS) data for consumer loans originated or purchased by the savings association for consideration under the lending test. A savings association may maintain data for one or more of the following categories of consumer loans: motor vehicle, credit card, home equity, other secured, and other unsecured. If the savings association maintains data for loans in a certain category, it shall maintain data for all loans originated or purchased within that category. The savings association shall maintain data separately for each category, including for each loan: (i) A unique number or alpha-numeric symbol that can be used to identify the relevant loan file; (ii) The loan amount at origination or purchase; (iii) The loan location; and (iv) The gross annual income of the borrower that the savings association considered in making its credit decision. (2) Other loan data. At its option, a savings association may provide other information concerning its lending performance, including additional loan distribution data. (d) Data on affiliate lending. A savings association that elects to have the OTS consider loans by an affiliate, for purposes of the lending or community development test or an approved strategic plan, shall collect, maintain, and report for those loans the data that the savings association would have collected, maintained, and reported pursuant to paragraphs (a), (b), and (c) of this section had the loans been originated or purchased by the savings association. For home mortgage loans, the savings association shall also be prepared to identify the home mortgage loans reported under part 203 of this title by the affiliate. (e) Data on lending by a consortium or a third-party. A savings association that elects to have the OTS consider community development loans by a consortium or third party, for purposes of the lending or community development tests or an approved strategic plan, shall report for those loans the data that the savings association would have reported under paragraph (b)(2) of this section had the loans been originated or purchased by the savings association. (f) Small savings associations electing evaluation under the lending, investment, and service tests. A savings association that qualifies for evaluation under the small savings association performance standards but elects evaluation under the lending, investment, and service tests shall collect, maintain, and report the data required for other savings associations pursuant to paragraphs (a) and (b) of this section. (g) Assessment area data. A savings association, except a small savings association or a savings association that was a small savings association during the prior calendar year, shall collect and report to the OTS by March 1 of each year a list for each assessment area showing the geographies within the area. (h) CRA Disclosure Statement. The OTS prepares annually for each savings association that reports data pursuant to this section a CRA Disclosure Statement that contains, on a state-by-state basis: (1) For each county (and for each assessment area smaller than a county) with a population of 500,000 persons or fewer in which the savings association reported a small business or small farm loan: (i) The number and amount of small business and small farm loans reported as originated or purchased located in low-, moderate-, middle-, and upper-income geographies; (ii) A list grouping each geography according to whether the geography is low-, moderate-, middle-, or upper-income; (iii) A list showing each geography in which the savings association reported a small business or small farm loan; and (iv) The number and amount of small business and small farm loans to businesses and farms with gross annual revenues of $1 million or less; (2) For each county (and for each assessment area smaller than a county) with a population in excess of 500,000 persons in which the savings association reported a small business or small farm loan: (i) The number and amount of small business and small farm loans reported as originated or purchased located in geographies with median income relative to the area median income of less than 10 percent, 10 or more but less than 20 percent, 20 or more but less than 30 percent, 30 or more but less than 40 percent, 40 or more but less than 50 percent, 50 or more but less than 60 percent, 60 or more but less than 70 percent, 70 or more but less than 80 percent, 80 or more but less than 90 percent, 90 or more but less than 100 percent, 100 or more but less than 110 percent, 110 or more but less than 120 percent, and 120 percent or more; (ii) A list grouping each geography in the county or assessment area according to whether the median income in the geography relative to the area median income is less than 10 percent, 10 or more but less than 20 percent, 20 or more but less than 30 percent, 30 or more but less than 40 percent, 40 or more but less than 50 percent, 50 or more but less than 60 percent, 60 or more but less than 70 percent, 70 or more but less than 80 percent, 80 or more but less than 90 percent, 90 or more but less than 100 percent, 100 or more but less than 110 percent, 110 or more but less than 120 percent, and 120 percent or more; (iii) A list showing each geography in which the savings association reported a small business or small farm loan; and (iv) The number and amount of small business and small farm loans to businesses and farms with gross annual revenues of $1 million or less; (3) The number and amount of small business and small farm loans located inside each assessment area reported by the savings association and the number and amount of small business and small farm loans located outside the assessment area(s) reported by the savings association; and (4) The number and amount of community development loans reported as originated or purchased. (i) Aggregate disclosure statements. The OTS, in conjunction with the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency, prepares annually, for each MSA or metropolitan division (including an MSA or metropolitan division that crosses a state boundary) and the nonmetropolitan portion of each state, an aggregate disclosure statement of small business and small farm lending by all institutions subject to reporting under this part or parts 25, 228, or 345 of this title. These disclosure statements indicate, for each geography, the number and amount of all small business and small farm loans originated or purchased by reporting institutions, except that the OTS may adjust the form of the disclosure if necessary, because of special circumstances, to protect the privacy of a borrower or the competitive position of an institution. (j) Central data depositories. The OTS makes the aggregate disclosure statements, described in paragraph (i) of this section, and the individual savings association CRA Disclosure Statements, described in paragraph (h) of this section, available to the public at central data depositories. The OTS publishes a list of the depositories at which the statements are available. [60 FR 22217, May 4, 1995, as amended at 69 FR 41189, July 8, 2004] (a) Information available to the public. A savings association shall maintain a public file that includes the following information: (1) All written comments received from the public for the current year and each of the prior two calendar years that specifically relate to the savings association's performance in helping to meet community credit needs, and any response to the comments by the savings association, if neither the comments nor the responses contain statements that reflect adversely on the good name or reputation of any persons other than the savings association or publication of which would violate specific provisions of law; (2) A copy of the public section of the savings association's most recent CRA Performance Evaluation prepared by the OTS. The savings association shall place this copy in the public file within 30 business days after its receipt from the OTS; (3) A list of the savings association's branches, their street addresses, and geographies; (4) A list of branches opened or closed by the savings association during the current year and each of the prior two calendar years, their street addresses, and geographies; (5) A list of services (including hours of operation, available loan and deposit products, and transaction fees) generally offered at the savings association's branches and descriptions of material differences in the availability or cost of services at particular branches, if any. At its option, a savings association may include information regarding the availability of alternative systems for delivering retail banking services (e.g., ATMs, ATMs not owned or operated by or exclusively for the savings association, banking by telephone or computer, loan production offices, and bank-at-work or bank-by-mail programs); (6) A map of each assessment area showing the boundaries of the area and identifying the geographies contained within the area, either on the map or in a separate list; and (7) Any other information the savings association chooses. (b) Additional information available to the public—(1) Savings associations other than small savings associations. A savings association, except a small savings association or a savings association that was a small savings association during the prior calendar year, shall include in its public file the following information pertaining to the savings association and its affiliates, if applicable, for each of the prior two calendar years: (i) If the savings association has elected to have one or more categories of its consumer loans considered under the lending test, for each of these categories, the number and amount of loans: (A) To low-, moderate-, middle-, and upper-income individuals; (B) Located in low-, moderate-, middle-, and upper-income census tracts; and (C) Located inside the savings association's assessment area(s) and outside the savings association's assessment area(s); and (ii) The savings association's CRA Disclosure Statement. The savings association shall place the statement in the public file within three business days of its receipt from the OTS. (2) Savings associations required to report Home Mortgage Disclosure Act (HMDA) data. A savings association required to report home mortgage loan data pursuant to part 203 of this title shall include in its public file a copy of the HMDA Disclosure Statement provided by the Federal Financial Institutions Examination Council pertaining to the savings association for each of the prior two calendar years. In addition, a savings association that elected to have the OTS consider the mortgage lending of an affiliate for any of these years shall include in its public file the affiliate's HMDA Disclosure Statement for those years. The savings association shall place the statement(s) in the public file within three business days after its receipt. (3) Small savings associations. A small savings association or a savings association that was a small savings association during the prior calendar year shall include in its public file: (i) The savings association's loan-to-deposit ratio for each quarter of the prior calendar year and, at its option, additional data on its loan-to-deposit ratio; and (ii) The information required for other savings associations by paragraph (b)(1) of this section, if the savings association has elected to be evaluated under the lending, investment, and service tests. (4) Savings associations with strategic plans. A savings association that has been approved to be assessed under a strategic plan shall include in its public file a copy of that plan. A savings association need not include information submitted to the OTS on a confidential basis in conjunction with the plan. (5) Savings associations with less than satisfactory ratings. A savings association that received a less than satisfactory rating during its most recent examination shall include in its public file a description of its current efforts to improve its performance in helping to meet the credit needs of its entire community. The savings association shall update the description quarterly. (c) Location of public information. A savings association shall make available to the public for inspection upon request and at no cost the information required in this section as follows: (1) At the main office and, if an interstate savings association, at one branch office in each state, all information in the public file; and (2) At each branch: (i) A copy of the public section of the savings association's most recent CRA Performance Evaluation and a list of services provided by the branch; and (ii) Within five calendar days of the request, all the information in the public file relating to the assessment area in which the branch is located. (d) Copies. Upon request, a savings association shall provide copies, either on paper or in another form acceptable to the person making the request, of the information in its public file. The savings association may charge a reasonable fee not to exceed the cost of copying and mailing (if applicable). (e) Updating. Except as otherwise provided in this section, a savings association shall ensure that the information required by this section is current as of April 1 of each year. A savings association shall provide in the public lobby of its main office and each of its branches the appropriate public notice set forth in Appendix B of this part. Only a branch of a savings association having more than one assessment area shall include the bracketed material in the notice for branch offices. Only a savings association that is an affiliate of a holding company shall include the last two sentences of the notices. The OTS publishes at least 30 days in advance of the beginning of each calendar quarter a list of savings associations scheduled for CRA examinations in that quarter. (a) Ratings in general. (1) In assigning a rating, the OTS evaluates a savings association's performance under the applicable performance criteria in this part, in accordance with §563e.21 and §563e.28, which provides for adjustments on the basis of evidence of discriminatory or other illegal credit practices. (2) A savings association's performance need not fit each aspect of a particular rating profile in order to receive that rating, and exceptionally strong performance with respect to some aspects may compensate for weak performance in others. The savings association's overall performance, however, must be consistent with safe and sound banking practices and generally with the appropriate rating profile as follows. (b) Savings associations evaluated under the lending, investment, and service tests—(1) Lending performance rating. The OTS assigns each savings association's lending performance one of the five following ratings. (i) Outstanding. The OTS rates a savings association's lending performance “outstanding” if, in general, it demonstrates: (A) Excellent responsiveness to credit needs in its assessment area(s), taking into account the number and amount of home mortgage, small business, small farm, and consumer loans, if applicable, in its assessment area(s); (B) A substantial majority of its loans are made in its assessment area(s); (C) An excellent geographic distribution of loans in its assessment area(s); (D) An excellent distribution, particularly in its assessment area(s), of loans among individuals of different income levels and businesses (including farms) of different sizes, given the product lines offered by the savings association; (E) An excellent record of serving the credit needs of highly economically disadvantaged areas in its assessment area(s), low-income individuals, or businesses (including farms) with gross annual revenues of $1 million or less, consistent with safe and sound operations; (F) Extensive use of innovative or flexible lending practices in a safe and sound manner to address the credit needs of low- or moderate-income individuals or geographies; and (G) It is a leader in making community development loans. (ii) High satisfactory. The OTS rates a savings association's lending performance “high satisfactory” if, in general, it demonstrates: (A) Good responsiveness to credit needs in its assessment area(s), taking into account the number and amount of home mortgage, small business, small farm, and consumer loans, if applicable, in its assessment area(s); (B) A high percentage of its loans are made in its assessment area(s); (C) A good geographic distribution of loans in its assessment area(s); (D) A good distribution, particularly in its assessment area(s), of loans among individuals of different income levels and businesses (including farms) of different sizes, given the product lines offered by the savings association; (E) A good record of serving the credit needs of highly economically disadvantaged areas in its assessment area(s), low-income individuals, or businesses (including farms) with gross annual revenues of $1 million or less, consistent with safe and sound operations; (F) Use of innovative or flexible lending practices in a safe and sound manner to address the credit needs of low- or moderate-income individuals or geographies; and (G) It has made a relatively high level of community development loans. (iii) Low satisfactory. The OTS rates a savings association's lending performance “low satisfactory” if, in general, it demonstrates: (A) Adequate responsiveness to credit needs in its assessment area(s), taking into account the number and amount of home mortgage, small business, small farm, and consumer loans, if applicable, in its assessment area(s); (B) An adequate percentage of its loans are made in its assessment area(s); (C) An adequate geographic distribution of loans in its assessment area(s); (D) An adequate distribution, particularly in its assessment area(s), of loans among individuals of different income levels and businesses (including farms) of different sizes, given the product lines offered by the savings association; (E) An adequate record of serving the credit needs of highly economically disadvantaged areas in its assessment area(s), low-income individuals, or businesses (including farms) with gross annual revenues of $1 million or less, consistent with safe and sound operations; (F) Limited use of innovative or flexible lending practices in a safe and sound manner to address the credit needs of low- or moderate-income individuals or geographies; and (G) It has made an adequate level of community development loans. (iv) Needs to improve. The OTS rates a savings association's lending performance “needs to improve” if, in general, it demonstrates: (A) Poor responsiveness to credit needs in its assessment area(s), taking into account the number and amount of home mortgage, small business, small farm, and consumer loans, if applicable, in its assessment area(s); (B) A small percentage of its loans are made in its assessment area(s); (C) A poor geographic distribution of loans, particularly to low- or moderate-income geographies, in its assessment area(s); (D) A poor distribution, particularly in its assessment area(s), of loans among individuals of different income levels and businesses (including farms) of different sizes, given the product lines offered by the savings association; (E) A poor record of serving the credit needs of highly economically disadvantaged areas in its assessment area(s), low-income individuals, or businesses (including farms) with gross annual revenues of $1 million or less, consistent with safe and sound operations; (F) Little use of innovative or flexible lending practices in a safe and sound manner to address the credit needs of low- or moderate-income individuals or geographies; and (G) It has made a low level of community development loans. (v) Substantial noncompliance. The OTS rates a savings association's lending performance as being in “substantial noncompliance” if, in general, it demonstrates: (A) A very poor responsiveness to credit needs in its assessment area(s), taking into account the number and amount of home mortgage, small business, small farm, and consumer loans, if applicable, in its assessment area(s); (B) A very small percentage of its loans are made in its assessment area(s); (C) A very poor geographic distribution of loans, particularly to low- or moderate-income geographies, in its assessment area(s); (D) A very poor distribution, particularly in its assessment area(s), of loans among individuals of different income levels and businesses (including farms) of different sizes, given the product lines offered by the savings association; (E) A very poor record of serving the credit needs of highly economically disadvantaged areas in its assessment area(s), low-income individuals, or businesses (including farms) with gross annual revenues of $1 million or less, consistent with safe and sound operations; (F) No use of innovative or flexible lending practices in a safe and sound manner to address the credit needs of low- or moderate-income individuals or geographies; and (G) It has made few, if any, community development loans. (2) Investment performance rating. The OTS assigns each savings association's investment performance one of the five following ratings. (i) Outstanding. The OTS rates a savings association's investment performance “outstanding” if, in general, it demonstrates: (A) An excellent level of qualified investments, particularly those that are not routinely provided by private investors, often in a leadership position; (B) Extensive use of innovative or complex qualified investments; and (C) Excellent responsiveness to credit and community development needs. (ii) High satisfactory. The OTS rates a savings association's investment performance “high satisfactory” if, in general, it demonstrates: (A) A significant level of qualified investments, particularly those that are not routinely provided by private investors, occasionally in a leadership position; (B) Significant use of innovative or complex qualified investments; and (C) Good responsiveness to credit and community development needs. (iii) Low satisfactory. The OTS rates a savings association's investment performance “low satisfactory” if, in general, it demonstrates: (A) An adequate level of qualified investments, particularly those that are not routinely provided by private investors, although rarely in a leadership position; (B) Occasional use of innovative or complex qualified investments; and (C) Adequate responsiveness to credit and community development needs. (iv) Needs to improve. The OTS rates a savings association's investment performance “needs to improve” if, in general, it demonstrates: (A) A poor level of qualified investments, particularly those that are not routinely provided by private investors; (B) Rare use of innovative or complex qualified investments; and (C) Poor responsiveness to credit and community development needs. (v) Substantial noncompliance. The OTS rates a savings association's investment performance as being in “substantial noncompliance” if, in general, it demonstrates: (A) Few, if any, qualified investments, particularly those that are not routinely provided by private investors; (B) No use of innovative or complex qualified investments; and (C) Very poor responsiveness to credit and community development needs. (3) Service performance rating. The OTS assigns each savings association's service performance one of the five following ratings. (i) Outstanding. The OTS rates a savings association's service performance “outstanding” if, in general, the savings association demonstrates: (A) Its service delivery systems are readily accessible to geographies and individuals of different income levels in its assessment area(s); (B) To the extent changes have been made, its record of opening and closing branches has improved the accessibility of its delivery systems, particularly in low- or moderate-income geographies or to low- or moderate-income individuals; (C) Its services (including, where appropriate, business hours) are tailored to the convenience and needs of its assessment area(s), particularly low- or moderate-income geographies or low- or moderate-income individuals; and (D) It is a leader in providing community development services. (ii) High satisfactory. The OTS rates a savings association's service performance “high satisfactory” if, in general, the savings association demonstrates: (A) Its service delivery systems are accessible to geographies and individuals of different income levels in its assessment area(s); (B) To the extent changes have been made, its record of opening and closing branches has not adversely affected the accessibility of its delivery systems, particularly in low- and moderate-income geographies and to low- and moderate-income individuals; (C) Its services (including, where appropriate, business hours) do not vary in a way that inconveniences its assessment area(s), particularly low- and moderate-income geographies and low- and moderate-income individuals; and (D) It provides a relatively high level of community development services. (iii) Low satisfactory. The OTS rates a savings association's service performance “low satisfactory” if, in general, the savings association demonstrates: (A) Its service delivery systems are reasonably accessible to geographies and individuals of different income levels in its assessment area(s); (B) To the extent changes have been made, its record of opening and closing branches has generally not adversely affected the accessibility of its delivery systems, particularly in low- and moderate-income geographies and to low- and moderate-income individuals; (C) Its services (including, where appropriate, business hours) do not vary in a way that inconveniences its assessment area(s), particularly low- and moderate-income geographies and low- and moderate-income individuals; and (D) It provides an adequate level of community development services. (iv) Needs to improve. The OTS rates a savings association's service performance “needs to improve” if, in general, the savings association demonstrates: (A) Its service delivery systems are unreasonably inaccessible to portions of its assessment area(s), particularly to low- or moderate-income geographies or to low- or moderate-income individuals; (B) To the extent changes have been made, its record of opening and closing branches has adversely affected the accessibility of its delivery systems, particularly in low- or moderate-income geographies or to low- or moderate-income individuals; (C) Its services (including, where appropriate, business hours) vary in a way that inconveniences its assessment area(s), particularly low- or moderate-income geographies or low- or moderate-income individuals; and (D) It provides a limited level of community development services. (v) Substantial noncompliance. The OTS rates a savings association's service performance as being in “substantial noncompliance” if, in general, the savings association demonstrates: (A) Its service delivery systems are unreasonably inaccessible to significant portions of its assessment area(s), particularly to low- or moderate-income geographies or to low- or moderate-income individuals; (B) To the extent changes have been made, its record of opening and closing branches has significantly adversely affected the accessibility of its delivery systems, particularly in low- or moderate-income geographies or to low- or moderate-income individuals; (C) Its services (including, where appropriate, business hours) vary in a way that significantly inconveniences its assessment area(s), particularly low- or moderate-income geographies or low- or moderate-income individuals; and (D) It provides few, if any, community development services. (c) Wholesale or limited purpose savings associations. The OTS assigns each wholesale or limited purpose savings association's community development performance one of the four following ratings. (1) Outstanding. The OTS rates a wholesale or limited purpose savings association's community development performance “outstanding” if, in general, it demonstrates: (i) A high level of community development loans, community development services, or qualified investments, particularly investments that are not routinely provided by private investors; (ii) Extensive use of innovative or complex qualified investments, community development loans, or community development services; and (iii) Excellent responsiveness to credit and community development needs in its assessment area(s). (2) Satisfactory. The OTS rates a wholesale or limited purpose savings association's community development performance “satisfactory” if, in general, it demonstrates: (i) An adequate level of community development loans, community development services, or qualified investments, particularly investments that are not routinely provided by private investors; (ii) Occasional use of innovative or complex qualified investments, community development loans, or community development services; and (iii) Adequate responsiveness to credit and community development needs in its assessment area(s). (3) Needs to improve. The OTS rates a wholesale or limited purpose savings association's community development performance as “needs to improve” if, in general, it demonstrates: (i) A poor level of community development loans, community development services, or qualified investments, particularly investments that are not routinely provided by private investors; (ii) Rare use of innovative or complex qualified investments, community development loans, or community development services; and (iii) Poor responsiveness to credit and community development needs in its assessment area(s). (4) Substantial noncompliance. The OTS rates a wholesale or limited purpose savings association's community development performance in “substantial noncompliance” if, in general, it demonstrates: (i) Few, if any, community development loans, community development services, or qualified investments, particularly investments that are not routinely provided by private investors; (ii) No use of innovative or complex qualified investments, community development loans, or community development services; and (iii) Very poor responsiveness to credit and community development needs in its assessment area(s). (d) Savings associations evaluated under the small savings association performance standards. The OTS rates the performance of each savings association evaluated under the small savings association performance standards as follows: (1) Eligibility for a satisfactory rating. The OTS rates a savings association's performance “satisfactory” if, in general, the savings association demonstrates: (i) A reasonable loan-to-deposit ratio (considering seasonal variations) given the savings association's size, financial condition, the credit needs of its assessment area(s), and taking into account, as appropriate, lending-related activities such as loan originations for sale to the secondary markets and community development loans and qualified investments; (ii) A majority of its loans and, as appropriate, other lending-related activities are in its assessment area(s); (iii) A distribution of loans to and, as appropriate, other lending related-activities for individuals of different income levels (including low- and moderate-income individuals) and businesses and farms of different sizes that is reasonable given the demographics of the savings association's assessment area(s); (iv) A record of taking appropriate action, as warranted, in response to written complaints, if any, about the savings association's performance in helping to meet the credit needs of its assessment area(s); and (v) A reasonable geographic distribution of loans given the savings association's assessment area(s). (2) Eligibility for an outstanding rating. A savings association that meets each of the standards for a “satisfactory” rating under this paragraph and exceeds some or all of those standards may warrant consideration for an overall rating of “outstanding.” In assessing whether a savings association's performance is “outstanding,” the OTS considers the extent to which the savings association exceeds each of the performance standards for a “satisfactory” rating and its performance in making qualified investments and its performance in providing branches and other services and delivery systems that enhance credit availability in its assessment area(s). (3) Needs to improve or substantial noncompliance ratings. A savings association also may receive a rating of “needs to improve” or “substantial noncompliance” depending on the degree to which its performance has failed to meet the standards for a “satisfactory” rating. (e) Strategic plan assessment and rating—(1) Satisfactory goals. The OTS approves as “satisfactory” measurable goals that adequately help to meet the credit needs of the savings association's assessment area(s). (2) Outstanding goals. If the plan identifies a separate group of measurable goals that substantially exceed the levels approved as “satisfactory,” the OTS will approve those goals as “outstanding.” (3) Rating. The OTS assesses the performance of a savings association operating under an approved plan to determine if the savings association has met its plan goals: (i) If the savings association substantially achieves its plan goals for a satisfactory rating, the OTS will rate the savings association's performance under the plan as “satisfactory.” (ii) If the savings association exceeds its plan goals for a satisfactory rating and substantially achieves its plan goals for an outstanding rating, the OTS will rate the savings association's performance under the plan as “outstanding.” (iii) If the savings association fails to meet substantially its plan goals for a satisfactory rating, OTS will rate the savings association as either “needs to improve” or “substantial noncompliance,” depending on the extent to which it falls short of its plan goals, unless the savings association elected in its plan to be rated otherwise, as provided in §563e.27(f)(4). [60 FR 22220, May 4, 1995, as amended at 67 FR 78152, Dec. 23, 2002] (a) Notice for main offices and, if an interstate savings association, one branch office in each state. Community Reinvestment Act Notice Under the Federal Community Reinvestment Act (CRA), the Office of Thrift Supervision (OTS) evaluates our record of helping to meet the credit needs of this community consistent with safe and sound operations. The OTS also takes this record into account when deciding on certain applications submitted by us. Your involvement is encouraged. You are entitled to certain information about our operations and our performance under the CRA, including, for example, information about our branches, such as their location and services provided at them; the public section of our most recent CRA Performance Evaluation, prepared by the OTS; and comments received from the public relating to our performance in helping to meet community credit needs, as well as our responses to those comments. You may review this information today. At least 30 days before the beginning of each quarter, the OTS publishes a nationwide list of the savings associations that are scheduled for CRA examination in that quarter. This list is available from the Regional Director (address). You may send written comments about our performance in helping to meet community credit needs to (name and address of official at savings association) and OTS (address). Your letter, together with any response by us, will be considered by the OTS in evaluating our CRA performance and may be made public. You may ask to look at any comments received by the Regional Director. You may also request from the Regional Director an announcement of our applications covered by the CRA filed with the OTS. We are an affiliate of (name of holding company), a savings and loan holding company. You may request from the Regional Director an announcement of applications covered by the CRA filed by savings and loan holding companies. (b) Notice for branch offices. Community Reinvestment Act Notice Under the Federal Community Reinvestment Act (CRA), the Office of Thrift Supervision (OTS) evaluates our record of helping to meet the credit needs of this community consistent with safe and sound operations. The OTS also takes this record into account when deciding on certain applications submitted by us. Your involvement is encouraged. You are entitled to certain information about our operations and our performance under the CRA. You may review today the public section of our most recent CRA evaluation, prepared by the OTS, and a list of services provided at this branch. You may also have access to the following additional information, which we will make available to you at this branch within five calendar days after you make a request to us: (1) A map showing the assessment area containing this branch, which is the area in which the OTS evaluates our CRA performance in this community; (2) information about our branches in this assessment area; (3) a list of services we provide at those locations; (4) data on our lending performance in this assessment area; and (5) copies of all written comments received by us that specifically relate to our CRA performance in this assessment area, and any responses we have made to those comments. If we are operating under an approved strategic plan, you may also have access to a copy of the plan. [If you would like to review information about our CRA performance in other communities served by us, the public file for our entire savings association is available at (name of office located in state), located at (address).] At least 30 days before the beginning of each quarter, the OTS publishes a nationwide list of the savings associations that are scheduled for CRA examination in that quarter. This list is available from the Regional Director (address). You may send written comments about our performance in helping to meet community credit needs to (name and address of official at savings association) and the Regional Director (address). Your letter, together with any response by us, will be considered by the OTS in evaluating our CRA performance and may be made public. You may ask to look at any comments received by the Regional Director. You may also request from the Regional Director an announcement of our applications covered by the CRA filed with the OTS. We are an affiliate of (name of holding company), a savings and loan holding company. You may request from the Regional Director an announcement of applications covered by the CRA filed by savings and loan holding companies. [60 FR 22223, May 4, 1995]
Title 12: Banks and Banking
PART 563e—COMMUNITY REINVESTMENT
Section Contents
§ 563e.11 Authority, purposes, and scope.
§ 563e.12 Definitions.
§ 563e.21 Performance tests, standards, and ratings, in general.
§ 563e.22 Lending test.
§ 563e.23 Investment test.
§ 563e.24 Service test.
§ 563e.25 Community development test for wholesale or limited purpose savings associations.
§ 563e.26 Small savings association performance standards.
§ 563e.27 Strategic plan.
§ 563e.28 Assigned ratings.
§ 563e.29 Effect of CRA performance on applications.
§ 563e.41 Assessment area delineation.
§ 563e.42 Data collection, reporting, and disclosure.
§ 563e.43 Content and availability of public file.
§ 563e.44 Public notice by savings associations.
§ 563e.45 Publication of planned examination schedule.
Appendix A to Part 563
Appendix B to Part 563
Subpart A—General
top
§ 563e.11 Authority, purposes, and scope.
top
§ 563e.12 Definitions.
top
Subpart B—Standards for Assessing Performance
top
§ 563e.21 Performance tests, standards, and ratings, in general.
top
§ 563e.22 Lending test.
top
§ 563e.23 Investment test.
top
§ 563e.24 Service test.
top
§ 563e.25 Community development test for wholesale or limited purpose savings associations.
top
§ 563e.26 Small savings association performance standards.
top
§ 563e.27 Strategic plan.
top
§ 563e.28 Assigned ratings.
top
§ 563e.29 Effect of CRA performance on applications.
top
Subpart C—Records, Reporting, and Disclosure Requirements
top
§ 563e.41 Assessment area delineation.
top
§ 563e.42 Data collection, reporting, and disclosure.
top
§ 563e.43 Content and availability of public file.
top
§ 563e.44 Public notice by savings associations.
top
§ 563e.45 Publication of planned examination schedule.
top
Appendix A to Part 563
top
Appendix B to Part 563
top
