FFIEC Announces Release of 2019 Public HMDA Data & OCC Finalizes Community Reinvestment Act Rule

Premier Insights - Industry Updates - FFIEC Announces Release of 2019 Public HMDA Data & OCC Finalizes Community Reinvestment Act Rule

2019 Public HMDA Data

On Wednesday, the FFIEC announced availability of the 2019 public HMDA data:

The Federal Financial Institutions Examination Council (FFIEC) today announced the availability of data on 2019 mortgage lending transactions at 5,508 U.S. financial institutions covered by the Home Mortgage Disclosure Act (HMDA). Covered institutions include banks, savings associations, credit unions, and mortgage companies.

The HMDA data are the most comprehensive publicly available information on mortgage market activity. They are used by industry, consumer groups, regulators, and others to assess potential fair lending risks and for other purposes.

This is the second year of reporting of expanded HMDA data, which includes a great deal of information formally not reported.  This includes data on key underwriting and pricing attributes for each loan as well has more detailed information on race and ethnicity.   Another significant change is the reporting of Home Equity Lines of Credit (HELOC’s) which were not required to be reported pre-2018.

A list of the required reporting points can be accessed here: https://s3.amazonaws.com/cfpb-hmda-public/prod/help/2019-hmda-fig.pdf.

The reporting for 2018 and 2019 is somewhat different than previous years in that smaller institutions are exempt from reporting some of the newer fields.  Also, some data points reported by lenders are not currently released publicly.  Users should become acquainted with the new formats.

Documentation and file specifications can be accessed here: https://ffiec.cfpb.gov/data-publication/documents#modified-lar.

Access to the data can be found here: https://ffiec.cfpb.gov/data-publication.

OCC Finalizes Community Reinvestment Act Rule

The Office of the Comptroller of the Currency and the FDIC had jointly created a proposal to revise and modernize the Community Reinvestment Act regulation.

The proposal was designed to “strengthen and modernize the Community Reinvestment Act (CRA) by clarifying and expanding the activities that qualify for CRA credit; updating where activities count for CRA credit; creating a more consistent and objective method for evaluating CRA performance; and providing for more timely and transparent CRA-related data collection, recordkeeping, and reporting.”

On May 20th, FDIC Chairman Jelena McWilliams announced that the agency would not finalize the proposed rulemaking to modernize the Community Reinvestment Act at this time.  The joint proposal included the Office of the Comptroller of the Currency (OCC) support, but the Federal Reserve had not signed on to the proposal.  There was no new timeline for implementation offered by the FDIC.

The OCC has subsequently finalized the new rule for institutions under its supervision.  The OCC had released a summary of the changes, which can be accessed below.  The objectives of the new rule appear to focus in on increasing activity to low-to-moderate income areas and persons, provide more objective measures for banks in which to evaluate their performance, expanding the opportunity for small business credit, provide greater agency transparency for regulated institutions, and adjust requirements to fit changes service delivery networks driven by technology and cultural shifts.

A complete summary of the proposal can be found here: https://www.occ.gov/topics/consumers-and-communities/cra/summary-of-cra-proposed-rule.pdf.

Dates for Implementation

Dates for implementation are shown as follows:

This rule is effective on October 1, 2020. Banks must comply with the final amendments by October 1, 2020, January 1, 2023, or January 1, 2024, as applicable. Until the compliance dates, banks must continue to comply with parts 25 and 195 that are in effect on September 30, 2020 (as set forth in appendix C to 12 CFR 25). Alternatively, the OCC may permit a bank to voluntarily comply, in whole or in part, with the amendments adopted in this release prior to the applicable compliance dates. Parts 25 and 195 that are in effect on September 30, 2020 (as set forth in appendix C) expire on January 1, 2024.

Link to the press release:

https://www.occ.treas.gov/news-issuances/news-releases/2020/nr-occ-2020-63.html

Link to the 372 page final rule:

https://www.occ.treas.gov/news-issuances/federal-register/2020/nr-occ-2020-63a.pdf

List of CRA Qualifying Activities under the new rule (22 pages):

https://www.occ.treas.gov/topics/consumers-and-communities/cra/cra-qualifying-activities.pdf

We intend to provide an analysis of the impacts of these changes for OCC regulated institutions in future posts, so be sure to subscribe below!

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