§__.26(b)(1) – 2
Q: How is the “reasonableness” of a loan-to-deposit ratio evaluated?
A2. No specific ratio is reasonable in every circumstance, and each small institution’s ratio is evaluated in light of information from the performance context, including the institution’s capacity to lend, demographic and economic factors present in the assessment area(s), and the lending opportunities available in the assessment area(s). If a small institution’s loan-to-deposit ratio appears unreasonable after considering this information, lending performance may still be satisfactory under this criterion taking into consideration the number and the dollar volume of loans sold to the secondary market or the number and amount and innovativeness or complexity of community development loans and lending-related qualified investments.
Source: Interagency Questions & Answers Regarding Community Reinvestment | July 2016