#46: You Only Have Three Weeks Left...

Let’s refocus our time on your CRA data integrity and, for some of you, your annual CRA data submission. For small and intermediate small banks, this means making sure your data is collected and maintained for future examiner review. For large banks, this means readying your data for FRB submission! By now, you are well on your way to testing, sampling and double checking your HMDA, small business and community development loans. Speaking of community development loans, have you finished scouring your loan originations to mine for additional community development loans that may have been overlooked? In the perfect world, your loan officers would be involving you in community development deals at the prospecting phase through origination or at least providing you with a credit approval memorandum or a heads up that they just closed a community development loan that you should take a look at! Just in case you are still working through this, here are three approaches you might want to consider as you continue to prepare for the March 1st deadline. #1 Economic Development Hook: When reviewing a credit approval memorandum for a potential economic development qualified community development loan, SBA size standards are commonly used to determine if a borrower qualifies as a small business. Unlike the "gross annual revenue" definition in small business reporting, the NAICS size standards use a different measure defined as "annual receipts." This enables you to generally qualify more businesses as "small" and thus more potential community development loans. Click this link to learn more: https://www.sba.gov/sites/default/files/2019-08/SBA%20Table%20of%20Size%20Standards_Effective%20Aug%2019%2C%202019_Rev.pdf#2 Check 2021 Double Check Loans for Renewals: Remember renewals generally count, so I double check my list for any "low-hanging fruit" as long as the community development purpose remains. Click this link to reference the Q&A: https://www.govinfo.gov/content/pkg/FR-2016-07-25/pdf/2016-16693.pdf§ ll.42(b)(2)—5: Should institutions collect and report data about community development loans that are refinanced or renewed?A5. Yes. Institutions should collect information about community development loans that they refinance or renew as loan originations. #3 Defending Community Development Loan Impact: Although not required to file, it is imperative that a folder is created for each community development loan that will be reported in the aggregate. This is a tedious task, but essential when regulators are on-site testing for impact. It's easy to push this task into the future, but trust me, it's a monumental task if left to the last minute with other competing priorities of onsite examination preparation. Don't let this slip, and if you need to take an extra few weeks after the filing deadline, then do so... just don't wait until the end of your exam cycle!Quotes• “I estimate that over 90% of banks underreport their community development loans.” (02:21-02:28)CRA Today helps bankers master the Community Reinvestment Act, get exam ready, and change lives through the power of community development.Want to learn the CRA basics? Sign up for CRA Essentials Live! A live webinar with Linda Ezuka that shares everything you need to create a solid foundation for your CRA journey. https://hub.cratoday.com/freewebinarReady to take a deeper dive into the CRA? Join your fellow CRA enthusiasts in the CRA Hub as we navigate regulatory change, study core CRA concepts and connect as community development professionals across the nation.https://cratoday.com/hub/Are you understating your lending performance? Learn the 5 Foundational Steps to Building an Outstanding Community Development Loan Portfolio with an on-demand training workshop.https://cratoday.com/blueprint/CRA Today Website: https://cratoday.com/ Linda Ezuka, LinkedIn https://www.linkedin.com/in/linda-ezuka-cra-today/Copyright © 2022 by CRA Today LLC(No claim to original U.S. government material)All rights reserved. No part of this podcast may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, including electronic, mechanical, photocopying, recording, or otherwise, without prior written permission of the author and publisher.This podcast is a periodic publication of CRA Today LLC and is intended to notify and inspire recipients of new developments in the Community Reinvestment Act. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.Podcast production and show notes provided by HiveCast.fm