(a) Conclusions.
(1) State, multistate
MSA, and institution test conclusions and performance scores.
(i) In general. For each of the
applicable performance tests pursuant to sections 228.22 through 228.26
and 228.30, the Board assigns conclusions and associated test performance
scores of “Outstanding,” “High Satisfactory,”
“Low Satisfactory,” “Needs to Improve,” or
“Substantial Noncompliance” for the performance of a bank
in each state and multistate MSA, as applicable pursuant to paragraph
(c) of this section, and for the institution.
(ii) Small banks. The Board assigns
conclusions of “Outstanding,” “Satisfactory,”
“Needs to Improve,” or “Substantial Noncompliance”
for the performance of a small bank evaluated under the Small Bank
Lending Test in section 228.29(a)(2) in each state and multistate
MSA, as applicable pursuant to paragraph (c) of this section, and
for the institution pursuant to section 228.29 and appendix E to this
part.
(iii) Banks
operating under a strategic plan. The Board assigns conclusions
for the performance of a bank operating under a strategic plan pursuant
to section 228.27 in each state and multistate MSA, as applicable
pursuant to paragraph (c) of this section, and for the institution
in accordance with the methodology of the plan and appendix C to this
part.
(2) Bank performance in metropolitan and nonmetropolitan
areas. Pursuant to 12 U.S.C. 2906, the Board provides conclusions
derived under this part separately for metropolitan areas in which
a bank maintains one or more domestic branch offices and for the nonmetropolitan
area of a state if a bank maintains one or more domestic branch offices
in such nonmetropolitan area.
(b) Ratings.
(1) In general. The Board assigns a rating for a bank’s overall CRA performance
of “Outstanding,” “Satisfactory,” “Needs
to Improve,” or “Substantial Noncompliance” in each
state and multistate MSA, as applicable pursuant to paragraph (c)
of this section, and for the institution, as provided in this section
and appendices D and E to this part. The ratings assigned by the Board
reflect the bank’s record of helping to meet the credit needs
of its entire community, including low- and moderate-income neighborhoods,
consistent with the safe and sound operation of the bank.
(2) State, multistate MSA, and institution ratings and overall performance
scores.
(i) For large banks, intermediate banks,
small banks that opt into the Retail Lending Test in section 228.22,
and limited purpose banks, the Board calculates and discloses the
bank’s overall performance score for each state and multistate
MSA, as applicable, and for the institution. The Board uses a bank’s
overall performance scores described in this section to assign a rating
for the bank’s overall performance in each state and multistate
MSA, as applicable, and for the institution, subject to paragraphs
(d) and (e) of this section.
(ii) Overall performance scores are
based on the bank’s performance score for each applicable performance
test and derived as provided in paragraph (b)(3) of this section,
as applicable, and appendix D to this part.
(3) Weighting of performance scores. In calculating a large bank’s
or intermediate bank’s overall performance score for each state
and multistate MSA, as applicable, and the institution, the Board
weights the performance scores for the bank for each applicable performance
test as provided in paragraphs (b)(3)(i) and (ii) of this section.
(i) Large bank performance test weights. The Board weights
the bank’s performance score for the performance tests applicable
to a large bank as follows:
(A) Retail Lending Test, 40 percent;
(B) Retail Services and Products
Test, 10 percent;
(C) Community
Development Financing Test, 40 percent; and
(D) Community Development Services Test, 10
percent.
(ii) Intermediate bank performance test weights. The Board
weights the bank’s performance score for the performance tests
applicable to an intermediate bank as follows:
(A) Retail Lending
Test, 50 percent; and
(B)
Intermediate Bank Community Development Test or Community Development
Financing Test, as applicable, 50 percent.
(4) Minimum conclusion requirements.
(i) Retail
Lending Test minimum conclusion. An intermediate bank or a large
bank must receive at least a “Low Satisfactory” Retail
Lending Test conclusion for the state, multistate MSA, or institution
to receive, respectively, a state, multistate MSA, or institution
rating of “Satisfactory” or “Outstanding.”
(ii) Minimum of “Low
Satisfactory” overall facility-based assessment area and retail
lending assessment area conclusion.
(A) For purposes of this
paragraph (b)(4)(ii)(A), the Board assigns a large bank an overall
conclusion for each facility-based assessment area and, as applicable,
each retail lending assessment area, as provided in paragraph g.2.ii
of appendix D to this part.
(B) Except as provided in section 228.51(e), a large bank with a
combined total of 10 or more facility-based assessment areas and retail
lending assessment areas in any state or multistate MSA, as applicable,
or for the institution may not receive a rating of “Satisfactory”
or “Outstanding” in that state or multistate MSA, as applicable,
or for the institution, unless the bank receives an overall conclusion
of at least “Low Satisfactory” in 60 percent or more of
the total number of its facility-based assessment areas and retail
lending assessment areas in that state or multistate MSA, as applicable,
or for the institution.
(c) Conclusions and ratings
for states and multistate MSAs.
(1) States.
(i) In general. Except as provided
in paragraph (c)(1)(ii) of this section, the Board evaluates a bank
and assigns conclusions and ratings for any state in which the bank
maintains a main office, branch, or deposit-taking remote service
facility.
(ii) States with rated multistate MSAs. The Board evaluates a bank
and assigns conclusions and ratings for a state only if the bank maintains
a main office, branch, or deposit-taking remote service facility outside
the portion of the state comprising any multistate MSA identified
in paragraph (c)(2) of this section. In evaluating a bank and assigning
conclusions and ratings for a state, the Board does not consider activities
to be in the state if those activities take place in the portion of
the state comprising any multistate MSA identified in paragraph (c)(2)
of this section.
(iii) States with non-rated multistate MSAs. If a facility-based
assessment area of a bank comprises a geographic area spanning two
or more states within a multistate MSA that is not identified in paragraph
(c)(2) of this section, the Board considers activities in the entire
facility-based assessment area to be in the state in which the bank
maintains, within the multistate MSA, a main office, branch, or deposit-taking
remote service facility. In evaluating a bank and assigning conclusions
and ratings for a state, the Board does not consider activities to
be in the state if those activities take place in any facility-based
assessment area that is considered to be in another state pursuant
to this paragraph (c)(1)(iii).
(iv) States with multistate retail
lending assessment areas. In assigning Retail Lending Test conclusions
for a state pursuant to section 228.22(h), the Board does not consider
a bank’s activities to be in the state if those activities take
place in a retail lending assessment area consisting of counties in
more than one state.
(2) Rated multistate
MSAs. The Board evaluates a bank and assigns conclusions and
ratings under this part in any multistate MSA in which the bank maintains
a main office, a branch, or a deposit-taking remote service facility
in two or more states within that multistate MSA.
(d) Effect of evidence of discriminatory
or other illegal credit practices.
(1) Scope. For each state and multistate MSA, as applicable, and the institution,
the Board’s evaluation of a bank’s performance under this
part is adversely affected by evidence of discriminatory or other
illegal credit practices, as provided in paragraph (d)(2) of this
section. The Board considers evidence of discriminatory or other illegal
credit practices described in this section by:
(i) The
bank, including by an operations subsidiary of the bank; or
(ii) Any other affiliate
related to any activities considered in the evaluation of the bank.
(2) Discriminatory or other illegal credit practices. For purposes of paragraph (d)(1) of this section, discriminatory
or other illegal credit practices consist of the following:
(i) Discrimination
on a prohibited basis, including in violation of the Equal Credit
Opportunity Act (15 U.S.C. 1691 et seq.) or the Fair Housing
Act (42 U.S.C. 3601 et seq.);
(ii) Violations of the Home Ownership
and Equity Protection Act (15 U.S.C. 1639);
(iii) Violations of section 5 of the
Federal Trade Commission Act (15 U.S.C. 45);
(iv) Violations of section 1031 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C.
5531, 5536);
(v)
Violations of section 8 of the Real Estate Settlement Procedures Act
(12 U.S.C. 2601 et seq.);
(vi) Violations of the Truth in Lending
Act (15 U.S.C. 1601 et seq.);
(vii) Violations of the Military Lending
Act (10 U.S.C. 987);
(viii) Violations of the Servicemembers Civil Relief Act (50 U.S.C.
3901 et seq.); and
(ix) Any other violation of a law, rule,
or regulation consistent with the types of violations in paragraphs
(d)(2)(i) through (viii) of this section, as determined by the Board.
(3) Agency considerations. In determining the
effect of evidence of discriminatory or other illegal credit practices
described in paragraph (d)(1) of this section on the bank’s
assigned state, multistate MSA, and institution ratings, the Board
will consider:
(i) The root cause or causes of any
such violations of law, rule, or regulation;
(ii) The severity of any harm to any
communities, individuals, small businesses, and small farms resulting
from such violations;
(iii) The duration of time over which the violations occurred;
(iv) The pervasiveness
of the violations;
(v) The degree to which the bank, operations subsidiary, or affiliate,
as applicable, has established an effective compliance management
system across the institution to self-identify risks and to take the
necessary actions to reduce the risk of noncompliance and harm to
communities, individuals, small businesses, and small farms; and
(vi) Any other relevant
information.
(e) Consideration of past performance. When
assigning ratings, the Board considers a bank’s past performance.
If a bank’s prior rating was “Needs to Improve,”
the Board may determine that a “Substantial Noncompliance”
rating is appropriate where the bank failed to improve its performance
since the previous evaluation period, with no acceptable basis for
such failure.
