§__.26(b)(1) Loan-to-Deposit Ratio Reasonableness
§__.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…
§__.26(b)(1) Off-shore Loans in Loan-to-Deposit Ratio
§__.26(b)(1) – 3 Q: If an institution makes a large number of loans off-shore, will examiners segregate the domestic loan-to-deposit ratio from the foreign loan-to-deposit ratio? A3. No. Examiner will look at the institution’s net loan-to-deposit ratio for the whole institution, without any adjustments. Source: Interagency Questions & Answers Regarding Community Reinvestment | July 2016
§__26(b)(2) Small Institution Lending Percentage in Assessment Area
§__.26(b)(2) – 1 Q: Must a small institution have a majority of its lending in its assessment area(s) to receive a satisfactory performance rating? A1. No. The percentage of loans and, as appropriate, other lending-related activities located in the institution’s assessment area(s) is but one of the performance criteria upon which small institutions are evaluated. If…
§__.26(b)(3) & (4) Small Institution Loan Distribution Performance
§__.26(b)(3) & (4) – 1 Q: How will a small institution’s performance be assessed under these lending distribution criteria [borrower income and geographic location]? A1. Distribution of loans, like other small institution performance criteria, is considered in light of the performance context. For example, a small institution is not required to lend evenly throughout its assessment area(s)…
§__.26(c) Intermediate Small Institution Community Development Test Flexibility
§__.26(c) – 1 Q: How will the community development test be applied flexibly for intermediate small institutions? A1. Generally, intermediate small institutions engage in a combination of community development loans, qualified investments, and community development services. An institution may not simply ignore one or more of these categories of community development, nor do the regulations prescribe a…
§__.26(c)(3) Intermediate Small Institution Service Evaluation
§__.26(c)(3) – 1 Q: What will examiners consider when evaluating the provision of community development services by an intermediate small institution? A1. In addition to the examples listed in Q&A § .12(i) – 3, examiners will consider retail banking services as community development services if they provide benefit to low- or moderate-income individuals. Examples include: low-cost deposit…
§__.26(c)(4) Intermediate Small Institution Responsiveness
§__.26(c)(4) – 1 Q: When evaluating an intermediate small institution’s community development record, what will examiners consider when reviewing the responsiveness of community development lending, qualified investments, and community development services to the community development needs of the area? A1. When evaluating an intermediate small institution’s community development record, examiners will consider not only quantitative measures of…
§__.26(d) Small Institution Achievement of Outstanding Rating
§__.26(d) – 1 Q: How can a small institution that is not an intermediate small institution achieve an “outstanding” performance rating? A1. A small institution that is not an intermediate small institution that meets each of the standards in the lending test for a “satisfactory” rating and exceeds some or all of those standards may warrant an…
§__.26(d) Small Institution Activities Outside Assessment Areas
§__.26(d) – 2 Q: Will a small institution’s qualified investments, community development loans, and community development services be considered if they do not directly benefit its assessment area(s)? A2. Yes. These activities are eligible for consideration if they benefit a benefit a broader statewide or regional area that includes a small institution’s assessment area(s), as discussed more…
§__.27(c) Agency Guidance during Strategic Plan Development
§__.27(c) – 1 Q: To what extent will the Agencies provide guidance to an institution during the development of its strategic plan? A1. An institution will have an opportunity to consult with and provide information to the Agencies on a proposed strategic plan. Through this process, an institution is provided guidance on procedures and on the information…