1- Group the analyses of the assessment areas examined by MSA3 and non-MSA areas within each state where the institution has branches. If an institution has branches in two or more states of a multi-state MSA, group the assessment areas that are in that MSA.
2 – Summarize conclusions about the institution’s performance in each MSA and the non-MSA portion of each state in which an assessment area received a full scope review. If two or more assessment areas in an MSA or in the non-MSA portion of a state received full scope reviews, weigh the different assessment areas considering such factors as:
a – The significance of the institution’s activities in each compared to the institution’s overall activities;
b – The retail lending and community development opportunities in each;
c – The importance of the institution in providing loans and community development activities to each, particularly in light of the number of other institutions and the extent of their activities in each; and
d – Demographic and economic conditions in each.
3 – For assessment areas in MSAs and non-MSA areas that were not examined using these procedures, consider facts and data related to the institution’s lending and community development activities to ensure that performance in those assessment areas is not inconsistent with the conclusions based on the assessment areas which received full scope reviews.
4 – For institutions operating in only one multi-state MSA or one state, assign one of the four preliminary ratings – “Satisfactory,” “Outstanding,” “Needs to Improve,” or “Substantial Noncompliance” — in accordance with step 6 below. To determine the relative significance of each MSA and non-MSA area to the institution’s preliminary rating, consider:
a – The significance of the institution’s activities in each compared to the institution’s overall activities;
b – The retail lending and community development opportunities in each;
c – The importance of the institution to each, particularly in light of the number of other institutions and the extent of their activities in each; and
d – Demographic and economic conditions in each.
5 – For other institutions, assign one of the four preliminary ratings — “Satisfactory,” “Outstanding,” “Needs to Improve,” or “Substantial Noncompliance” — for each state in which the institution has at least one branch and for each multi-state MSA in which the institution has branches in two or more states in accordance with step #6 below. To determine the relative significance of each MSA and the non-MSA area on the institution’s preliminary state rating, consider:
a – The significance of the institution’s activities in each compared to the institution’s overall activities;
b – The retail lending and community development opportunities in each;
c – The importance of the institution in each, particularly in light of the number of other institutions and the extent of their activities in each; and
d – Demographic and economic conditions in each.
6 – Consult the intermediate small institution ratings matrices (lending and community development) and information in work papers to assign a preliminary rating of:
a – “Satisfactory” if the institution’s performance is rated as “Satisfactory” in each test.
b – “Needs to Improve” or “Substantial Noncompliance,” depending upon the degree to which the institution’s Intermediate Small Institution CRA Examination Procedures OCC, FRB, FDIC and OTS- July 2007 performance has failed to meet the standards for a “Satisfactory” rating on a test; or
c – “Outstanding” if the institution is rated an ”Outstanding” on both tests; or “Outstanding” on one test and the extent to which the institution meets or exceeds the “Satisfactory” criteria on the other test.
7 – For an institution with branches in more than one state or multi-state MSA, assign a preliminary rating to the institution as a whole taking into account the institution’s record in different states or multi-state MSAs by considering:
a – The significance of the institution’s activities in each compared to the institution’s overall activities;
b – The retail lending and community development opportunities in each;
c – The importance of the institution in providing loans to each, particularly in light of the number of other institutions and the extent of their activities in each; and
d – Demographic and economic conditions in each.
8 – Review the results of the most recent compliance examination and determine whether evidence of discriminatory or other illegal credit practices should lower the institution’s overall CRA rating or, if applicable, its CRA rating in any state or multi-state MSA. If evidence of discrimination or other illegal credit practices in any geography by the institution, or in any assessment area by any affiliate whose loans were considered as part of the institution’s lending performance, was found, consider:
a – The nature, extent, and strength of the evidence of the practices;
b – The policies and procedures that the institution (or affiliate, as applicable) has in place to prevent the practices; Intermediate Small Institution CRA Examination Procedures OCC, FRB, FDIC and OTS- July 2007
c – Any corrective action that the institution (or affiliate, as applicable) has taken, or has committed to take, including voluntary corrective action resulting from self-assessment; and
d – Any other relevant information.
9 – Assign a final rating for the institution as a whole and, if applicable, each state in which the institution has at least one branch and each multi-state MSA in which it has branches in two or more states, considering:
a – The institution’s preliminary rating; and
b – Any evidence of discriminatory or other illegal credit practices.
10 – Discuss conclusions with management.
11 – Write an evaluation of the institution’s performance for the examination report and the public evaluation.
12 – Prepare recommendations for a supervisory strategy and for matters that require attention or follow-up activities.
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3 The reference to MSA may also reference MD. Intermediate Small Institution CRA Examination Procedures OCC, FRB, FDIC and OTS- July 2007
SOURCE: Intermediate Small Institution CRA Examination Procedures | OCC, FRB, FDIC, and OTS