Section VI - Community Reinvestment Act, CRA Sunshine, and Prohibition against use of Interstate Branches Primarily for Deposit Production
The regulation permits two different types of assessment area delineations. What are the two types of delineated assessment areas under the 2020 OCC CRA rule? A) Facility-based and deposit-based B) Facility-based and REMA-based C) Facility-based and lending footprint-based D) Deposit-based and lending-based
A) Facility-based and deposit-based
A bank has been criticized by an examiner for less than satisfactory CRA performance. The bank must show improvement in its commitment to CRA. For the examiner, what would be LEAST effective in demonstrating change? A) Informing the examiner that the bank does not plan to acquire or merge with another bank, so CRA is not a priority. B) Giving the examiner an updated CRA public file C) Showing the examiner, a list of community groups with which the bank has met in the past 24 months to discuss credit needs D) Showing the examiner results of the banks most recent geocoding analysis, indicating parity in the number of loans made in each census tract
A) Informing the examiner that the bank does not plan to acquire or merge with another bank, so CRA is not a priority.
In the small bank performance standards, which of the following is not a criterion? A) The banks CRA strategic plan B) The banks loan to deposit ratio C) The geographic distribution of loans D) The percentage of loans within the bank's assessment area
A) The banks CRA strategic plan
QRS State Bank is being examined under the lending test. Which of the following is the most relevant criteria for the lending test? A) The distribution of the banks small business loans B) The racial and gender characteristics of QRS's lending staff C) The location of QRS's branches D) The services QRS offers to its community
A) The distribution of the banks small business loans
Which of the following institutions could be examined for CRA under the intermediate small bank performance standard? A) Bank A, a $230 million bank B) Bank B, a $700 million bank C) Bank C, a $50 million bank D) Bank D, a $2 billion bank
B) Bank B, a $700 million bank
Which of the following must a large bank maintain a part of its CRA program? A) A record of director, officer and employee community involvement, and a listing of loans made to low and moderate income individuals B) Description of its assessment area, written comments and responses, and the public portion of the regulator's most recent CRA performance evaluation C) Copy of the bank's CRA Notice and the bank's most recent five years of CRA disclosure statements D) A comprehensive record of all CRA related training completed by employees during the past two years
B) Description of its assessment area, written comments and responses, and the public portion of the regulator's most recent CRA performance evaluation
Which of the following is true of a bank's CRA strategic plan? A) It must be limited to a one-year term B) It must have interim measurable goals C) Affiliates are required to have their own plans D) Even if the bank has multiple assessment areas, it is only allowed to have one strategic plan
B) It must have interim measurable goals
Which of the following institutions is exempt from the coverage of CRA? A) State National Bank of Ashgrove, a $15 million bank in a rural community not located in an MSA B) Trust Company, Inc., an institution offering only trust services located in a large urban area C) ACME Savings Association, a federal thrift institution located in a medium sized midwestern city, included in an MSA D) First National Bank, a $250 million bank located in a rural area , not in an MSA
B) Trust Company, Inc., an institution offering only trust services located in a large urban area
Which of the following criteria accurately describes a small business loan for which a large bank must annually report? A) A loan to a business that employs fewer than 50 people B) A line of credit to a business with assets of less than $5 million C) A loan with an original principal amount of $1million or less to a business D) A loan to a business that does not generally have access to regional or national credit markets
C) A loan with an original principal amount of $1million or less to a business
Which of the following banks CANNOT select Montana as its home state for deposit production purposes? A) ABC National Bank with its headquarters in Missoula, Montana B) XYZ State Bank, with a Montana state charter C) ACME National Bank with its headquarters in Minneapolis, MN, but with most of its branches and the majority of its loans in Montana D) Friendly Bank, a U.S. branch of a foreign bank with two U.S. locations, one in Montana and one in Wyoming
C) ACME National Bank with its headquarters in Minneapolis, MN, but with most of its branches and the majority of its loans in Montana
Williams National Bank has its home office in New York State; however, it has branches in Nebraska. The federal banking agencies most recent host state loan-to-deposit publication lists the loan-to-deposit ratio for Nebraska as 78 percent. For Williams Bank to pass the loan-to-deposit screen of the Reigle-Neal Act, what must its loan-to-deposit ratio be for Nebraska? A) At least 78 percent B) At least 50 percent C) At least 39 percent D) At least 25 percent
C) At least 39 percent
What date must a bank other than small, intermediate, wholesale, or limited purpose bank, comply with most requirements of the 2020 OCC CRA Rule (OCC Bulletin 2021-24)? A) January 1, 2021 B) January 1, 2022 C) January 1, 2023 D) January 1, 2024
C) January 1, 2023
A bank received a signed letter criticizing its performance in meeting the credit needs of a community, but not adversely reflecting upon any individual bank employee's reputation. What must the bank do with this letter? A) Have it reviewed and discussed by the board of directors B) File it with the regional office of the bank's federal regulator C) Retain it in the CRA public comment file D) Answer it within 10 business days
C) Retain it in the CRA public comment file
ABC National Bank, an independent, limited purpose bank with $120 million in total assets located in a large urban area, is in the process of determining its option for its CRA evaluation. Unless the bank chooses otherwise, under which test will it be evaluated for CRA performance? A) The intermediate small bank performance standards B) The lending, investment, and service tests C) The community development test D) The lending test
C) The community development test
Which of the following is NOT a requirement of CRA? A) To delineate the bank's assessment area(s) B) To collect loan data C) To approve the bank's CRA statement at an annual board meeting D) To report small business loan data
C) To approve the bank's CRA statement at an annual board meeting
Fill in the blanks - Based on the 2020 thresholds, a bank with assets of more than ____, but less than ____ in four of the previous five calendar quarters would be considered an intermediate bank under the new OCC rule. A) $320 million & $1.31 billion B) $600 million & $ 1.5 billion C) $500 million & $2.5 billion D) $600 million & $2.5 billion
D) $600 million & $2.5 billion
In evaluating a banks CRA performance, to what do bank examiners give the greatest consideration? A) Efforts to analyze the geographic origins of its deposit base B) Efforts to establish communication with members of the community regarding credit needs C) Participation of the bank's board of directors in formulating CRA policy D) Extensions of credit the bank has made where the financing benefits low- and moderate-income borrowers or neighborhoods
D) Extensions of credit the bank has made where the financing benefits low- and moderate-income borrowers or neighborhoods
What obligation does a bank have to disclose a covered CRA agreement to the relevant supervisory agency, 40 months after it terminates? A) It must maintain a copy in its CRA public file B) It must send a copy to its regulatory agency upon request C) It must send a copy to a member of the public upon request D) It has no obligation to disclose these covered CRA agreements
D) It has no obligation to disclose these covered CRA agreements
Which of the following is the best method for a large bank to use in monitoring its CRA performance? A) Review the effectiveness of marketing materials B) Evaluate approval and denial rates from minority loan applicants C) Perform a quarterly evaluation of the bank's loans to deposits ratio D) Perform a geographic analysis of lending levels and dispersion of loans
D) Perform a geographic analysis of lending levels and dispersion of loans
A banking agency is conducting a credit needs determination. Which of the following is NOT a criterion used in such a determination? A) The bank's CRA rating B) Economic conditions, including loan demand in the bank's communities C) Whether the bank was once part of a failed institution D) The bank's profitability ratios
D) The bank's profitability ratios
