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OCC Updates Policies and Procedures to Clarify Impact of CRA Ratings on Licensing Applications
On November 8, the OCC issued Bulletin 2017-51, updating guidance related to its approach when evaluating certain licensing applications from OCC-supervised banks that have “less than satisfactory” Community Reinvestment Act (CRA) ratings, either overall or in one or more particular geographic region. The revised Policies and Procedures Manual (PPM 6300-2) provides clarity on the OCC’s scrutiny of a bank’s CRA performance when an application is submitted to participate in a covered transaction such as (i) establishing or relocating a branch or main or home office; (ii) participating in a Bank Merger Act filing; (iii) converting from a state to a federal charter; and (iv) converting between federal charters. The revisions also allow applicants to document for the OCC how participating in such a transaction would “help the bank to achieve its CRA objectives” and “meet the credit needs of the community it serves, consistent with its safe and sound operation.”