[Federal Register: July 8, 2004 (Volume 69, Number 130)]
[Rules and Regulations]
[Page 41181-41189]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08jy04-2]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Part 25
[Docket No. 04-17]
RIN 1557-AC86
FEDERAL RESERVE SYSTEM
12 CFR Part 228
[Regulation BB; Docket No. R-1205]
FEDERAL DEPOSIT INSURANCE CORPORATION
12 CFR Part 345
RIN 3064-AC82
DEPARTMENT OF THE TREASURY
Office of Thrift Supervision
12 CFR Part 563e
[No. 2004-28]
RIN 1550-AB91
Community Reinvestment Act Regulations
AGENCIES: Office of the Comptroller of the Currency, Treasury (OCC);
Board of Governors of the Federal Reserve System (Board); Federal
Deposit Insurance Corporation (FDIC); Office of Thrift Supervision,
Treasury (OTS).
ACTION: Joint interim rule with request for comment.
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SUMMARY: The OCC, Board, FDIC and OTS (collectively, ``we'' or ``the
[[Page 41182]]
agencies'') are publishing this joint interim rule with request for
comment to conform our regulations implementing the Community
Reinvestment Act (CRA) to changes in: the Standards for Defining
Metropolitan and Micropolitan Statistical Areas published by the U.S.
Office of Management and Budget (OMB) in December 2000; census tracts
designated by the U.S. Bureau of the Census (Census); and the Board's
Regulation C, which implements the Home Mortgage Disclosure Act (HMDA).
We are also making a technical correction to a cross-reference within
our CRA regulations.
This joint interim rule does not make substantive changes in the
requirements of the CRA regulations. We are publishing this document as
a joint interim rule because the changes made by OMB, Census, and the
Board have already become effective. Further, financial institutions
must use OMB's statistical area standards, Census' geographies, and the
Board's Regulation C, when adjusting assessment area delineations and
collecting CRA loan data, beginning January 1, 2004.
DATES: This joint interim rule is effective on July 8, 2004. Comments
are due by September 7, 2004.
ADDRESSES: OCC: Comments: Your comment must designate ``OCC'' and
include Docket Number 04-17 or Regulatory Information Number (RIN)
1557-AC86. In general, the OCC will enter all comments received into
the docket without change, including any business or personal
information that you provide. Because paper mail in the Washington area
and at the OCC may be subject to delays, please submit your comment by
e-mail or fax whenever possible. However, you may submit your comment
by any of the following methods:
Federal eRulemaking Portal:
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.regulations.gov.
Follow the instructions for submitting comments.
OCC Web site:
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.occ.gov.
Click on ``Contact the OCC.'' Next, scroll down and click on ``Comments on Proposed Regulations.''
E-mail Address: regs.comments@occ.treas.gov.
Fax: (202) 874-4448.
Mail: Office of the Comptroller of the Currency, 250 E Street, SW.,
Public Information Room, Mailstop 1-5, Washington, DC 20219.
Hand Delivery/Courier: 250 E Street, SW., Attn: Public Information
Room, Mail Stop 1-5, Washington, DC 20219.
Docket Information: For access to the docket to read comments
received or background documents you may:
View Docket Information in Person: You may personally inspect and
photocopy docket information at the OCC's Public Information Room, 250
E Street, SW., Washington, DC. You can make an appointment to inspect
the docket by calling us at (202) 874-5043.
View docket information electronically: You may request that we
send you an electronic copy of docket information via e-mail or CD-ROM
by contacting regs.comments@occ.treas.gov.
Request copies: You may request that we send you a paper copy of
docket information by faxing us at (202) 874-4448, by calling us at
(202) 874-5043, or by mailing the OCC at 250 E Street, SW., Attn:
Public Information Room, Mail Stop 1-5, Washington, DC 20219.
Board: You may submit comments, identified by Docket No. R-1205, by
any of the following methods:
Agency Web Site:
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.federalreserve.gov
Follow the instructions for submitting comments at
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.
E-mail: regs.comments@federalreserve.gov. Include docket number in
the subject line of the message.
Fax: 202/452-3819 or 202/452-3102.
Mail: Jennifer J. Johnson, Secretary, Board of Governors of the
Federal Reserve System, 20th Street and Constitution Avenue, NW.,
Washington, DC 20551.
All public comments are available from the Board's Web site at
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm
as submitted,
except as necessary for technical reasons. Accordingly, your comments
will not be edited to remove any identifying or contact information.
Public comments may also be viewed electronically or in paper in Room
MP-500 of the Board's Martin Building (20th and C Streets, NW.) between
9 a.m. and 5 p.m. on weekdays.
FDIC: Mail: Written comments should be addressed to Robert E.
Feldman, Executive Secretary, Attention: Comments, Federal Deposit
Insurance Corporation, 550 17th Street, NW., Washington, DC 20429.
Delivery: Comments may be hand delivered to the guard station at
the rear of the 550 17th Street Building (located on F Street) on
business days between 7 a.m. and 5 p.m.
Agency Web site:
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.fdic.gov/regulations/laws/federal/propose.html.
Follow instructions for submitting comment on the agency
Web site.
E-mail: You may also electronically mail comments to
comments@fdic.gov.
Public Inspection: Comments may be inspected and photocopied in the
FDIC Public Information Center, Room 100, 801 17th Street, NW.,
Washington, DC 20429, between 9 a.m. and 4:30 p.m. on business days.
OTS: You may submit comments, identified by No. 2004-28, by any of
the following methods:
Federal eRulemaking Portal:
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.regulations.gov.
Follow the
instructions for submitting comments.
E-mail: regs.comments@ots.treas.gov. Please include No. 2004-28 in
the subject line of the message and include your name and telephone
number in the message.
Fax: (202) 906-6518.
Mail: Regulation Comments, Chief Counsel's Office, Office of Thrift
Supervision, 1700 G Street, NW., Washington, DC 20552, Attention: No.
2004-28.
Hand Delivery/Courier: Guard's Desk, East Lobby Entrance, 1700 G
Street, NW., from 9 a.m. to 4 p.m. on business days, Attention:
Regulation Comments, Chief Counsel's Office, Attention: No. 2004-28.
Instructions: All submissions received must include the agency name
and number or Regulatory Information Number (RIN) for this rulemaking.
All comments received will be posted without change to
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1,
including any personal information provided.
Docket: For access to the docket to read background documents or
comments received, go to
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1.
In addition, you may inspect comments
at the Public Reading Room, 1700 G Street, NW., by appointment. To make
an appointment for access, call (202) 906-5922, send an e-mail to
public.info@ots.treas.gov, or send a facsimile transmission to (202)
906-7755. (Prior notice identifying the materials you will be
requesting will assist us in serving you.) We schedule appointments on
business days between 10 a.m. and 4 p.m. In most cases, appointments
will be available the next business day following the date we receive a
request.
FOR FURTHER INFORMATION CONTACT: OCC: Karen Tucker, National Bank
Examiner, Compliance Division, (202) 874-4428; or Margaret Hesse,
Special Counsel, Community and Consumer
[[Page 41183]]
Law Division, (202) 874-5750, Office of the Comptroller of the
Currency, 250 E Street, SW., Washington, DC 20219.
Board: William T. Coffey, Senior Review Examiner, (202) 452-3946;
Catherine M.J. Gates, Oversight Team Leader, (202) 452-3946; Kathleen
C. Ryan, Counsel, (202) 452-3667; or Dan S. Sokolov, Senior Attorney,
(202) 452-2412, Division of Consumer and Community Affairs, Board of
Governors of the Federal Reserve System, 20th Street and Constitution
Avenue, NW., Washington, DC 20551.
FDIC: Pamela Freeman, Policy Analyst, (202) 898-6568, Division of
Supervision and Consumer Protection; or Susan van den Toorn, Counsel,
Legal Division, (202) 898-8707, Federal Deposit Insurance Corporation,
550 17th Street, NW., Washington, DC 20429.
OTS: Celeste Anderson, Project Manager, Compliance Policy, (202)
906-7990; Theresa A. Stark, Program Manager, Compliance Policy, (202)
906-7054; or Richard Bennett, Counsel (Banking and Finance),
Regulations and Legislation Division, (202) 906-7409, Office of Thrift
Supervision, 1700 G Street, NW., Washington, DC 20552.
SUPPLEMENTARY INFORMATION:
Introduction
The agencies jointly are amending our regulations implementing the
CRA (12 U.S.C. 2901 et seq.). This joint interim rule conforms the
agencies' CRA regulations to recent actions of OMB, Census, and the
Board. (This joint interim rulemaking is unrelated to the agencies'
comprehensive review of the CRA regulations and the proposed revisions
to the regulations that were published for comment on February 6, 2004,
at 69 FR 5729.)
Changes Resulting From OMB Revisions
The OMB's standards for defining statistical areas provide
nationally consistent definitions for government agencies to use when
collecting, tabulating, and publishing Federal statistics by geographic
area. OMB updates the standards approximately every 10 years.
The agencies' CRA regulations use OMB's standards for defining
metropolitan areas for purposes of CRA data collection and reporting,
and for delineating institutions' assessment area(s). Under OMB's 1990
standards, metropolitan areas consisted of: (1) Metropolitan
statistical areas (MSAs) and (2) larger consolidated metropolitan
statistical areas (CMSAs). CMSAs consisted, in turn, of primary
metropolitan statistical areas (PMSAs).
On December 27, 2000, OMB published in the Federal Register a
notice adopting new Standards for Defining Metropolitan and
Micropolitan Statistical Areas. 65 FR 82228 (Dec. 27, 2000). These new
standards replaced and superseded OMB's 1990 standards for defining
metropolitan areas. The 2000 standards retain the basic concept of an
MSA (an area with at least 50,000 population) and continue to recognize
that in large MSAs, demographic and economic conditions vary widely.
According to OMB, those variations necessitate dividing large MSAs into
``metropolitan divisions,'' smaller statistical areas similar to
PMSAs.\1\ Metropolitan divisions are only in MSAs that have a single
core with a population of at least 2.5 million.
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\1\ ``The provision of data for only the entire metropolitan
area based on such large urbanized areas may mask demographic and
economic variations that are important for data users and
analysts.'' Final Report and Recommendations from the Metropolitan
Areas Standards Review Committee to OMB Concerning Changes to the
Standards for Defining Metropolitan Areas, 65 FR 51060, 51067 (Aug.
22, 2000).
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More than two years later, in June 2003, OMB announced the specific
boundaries of the new MSAs, metropolitan divisions, and other
statistical areas based on data from the 2000 Census. OMB Bulletin No.
03-04 (June 6, 2003), available at
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.whitehouse.gov/omb/bulletins/b03-04.html.
OMB updated the list of MSAs and other statistical areas effective December 2003,
in a bulletin issued in February 2004. OMB Bulletin No. 04-03 (February 18, 2004) available at
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.whitehouse.gov/omb/bulletins/b0-03.html.
In these bulletins, OMB directed all agencies that conduct statistical activities to
collect and publish data for MSAs using the most recent definition of
the area. To that end, the agencies have made a number of changes to
the CRA regulations, which until now have conformed to OMB's 1990
statistical area standards, to incorporate OMB's new standards and
definitions.
First, we removed the definition of ``CMSA'' and all references to
CMSAs in our regulations because OMB no longer uses that term. We
replaced ``CMSA'' with ``MSA.''
Second, we revised the definition of ``MSA'' (Sec. Sec. 25.12(r),
228.12(r), 345.12(r), and 563e.12(q)) to remove the reference to PMSA,
another term that OMB no longer uses. The revised definition of ``MSA''
refers only to metropolitan statistical areas, as defined by OMB.
Third, we added a definition of ``metropolitan division'' (new
Sec. Sec. 25.12(q), 228.12(q), 345.12(q), and 563e.12(p)). In certain
MSAs, OMB has delineated ``metropolitan divisions'' which are the
statistical areas for which CRA data are to be reported, median family
income is to be calculated, and within which an institution's CRA
performance is to be evaluated. These uses of the metropolitan
divisions are consistent with the use of OMB's 1990 standards in our
CRA regulations in effect prior to this joint interim rule:
Institutions reported the location of loans by PMSA if the loan was
located in a CMSA; the agencies evaluated the institution's performance
at the PMSA level; and the agencies calculated median family income by
PMSA, not by CMSA. Focusing on performance at the metropolitan division
level also is consistent with OMB's recent direction to Federal
agencies to provide detailed data for each metropolitan division, in
explanation of which OMB noted that ``[a] Metropolitan Division is most
generally comparable in concept, and equivalent to, the now obsolete
Primary Metropolitan Statistical Area.'' OMB Bulletin 04-03.
The agencies are aware that in some MSAs, OMB's new designations of
metropolitan divisions will result in the income level of census tracts
changing without any actual change in the economic conditions of the
area. Based on estimated data, the agencies believe that in most MSAs,
any such changes will be de minimus. For example, many MSAs show
negligible change in the median family income levels of census tracts.
On the other hand, in the Detroit-Warren-Livonia MSA, changes in census
tract income level may be significant; the application of OMB's 2000
standards resulted in two metropolitan divisions, one consisting of
Wayne county, which includes the inner city, and one consisting of the
suburban counties that surround Wayne county. A number of geographies
in the suburban metropolitan division that previously were classified
as middle-income are now moderate-income, while in the urban
metropolitan division (Wayne county), a similar number of moderate-
income geographies are now middle-income. Examiners will consider these
differences and the effect they may have on an institution's CRA
performance as part of the performance context applicable to the
institution's CRA examination and in connection with the institution's
delineation of assessment area(s).
Fourth, we changed our regulations (Sec. Sec. 25.41, 228.41,
345.41, and 563e.41) to allow an institution to designate an assessment
area that includes one or more metropolitan divisions, just as an
institution until now could designate an
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assessment area that includes one or more PMSAs. Under this joint
interim rule, an institution may designate one or more metropolitan
divisions, up to an entire MSA, as an assessment area.
Although the agencies' regulations prior to publication of this
joint interim rule allowed an institution to delineate an entire CMSA
as an assessment area, examiners have evaluated CRA performance at the
PMSA level, using PMSA income data. Under this joint interim rule,
examiners will evaluate CRA performance at the metropolitan division
level, even if the institution delineates an assessment area of more
than one metropolitan division or an entire MSA.
Fifth, prior to this joint interim rule, Sec. Sec. 25.41(e)(4),
228.41(e)(4), 345.41(e)(4), and 563e.41(e)(4) stated that an assessment
area ``may not extend substantially beyond a CMSA boundary * * *.'' We
have changed these provisions to replace ``CMSA'' with ``MSA.'' These
changes conform the terminology in this section to the new OMB area
standards. The regulations still allow an institution to delineate an
assessment area consisting of more than one MSA. See Sec. Sec.
21.41(c)(1), 228.41(c)(1), 345.41(c)(1), and 563e.41(c)(1). The border
of such an assessment area, however, may not extend substantially
beyond the boundaries of the MSAs in the assessment area.
Sixth, we added a new definition of ``nonmetropolitan area,'' which
is any area that is not included in an MSA (new Sec. Sec. 25.12(s),
228.12(s), 345.12(s), and 563e.12(r)). This definition will encompass
areas covered by the new OMB term ``micropolitan statistical area.''
Because micropolitan statistical areas are not located in MSAs, they
are part of the nonmetropolitan area of a state. In a related matter,
the agency-prepared annual aggregate disclosure statements will
continue to include a statement for the non-MSA portion of every state,
which will include all micropolitan statistical areas in the state. We
changed the reference to ``non-MSA portion of each state'' in
Sec. Sec. 25.42(i), 228.42(i), 345.42(i), and 563e.42(i) to
``nonmetropolitan portion of each state'' to ensure clarity.
Changes Resulting From Census Revisions
Prior to this joint interim rule, the CRA regulations (former
Sec. Sec. 25.12(l), 228.12(l), 345.12(l), and 563e.12(k)) defined the
term ``geography'' as ``a census tract or a block numbering area
delineated by the United States Bureau of the Census in the most recent
decennial census.'' Prior to Census 2000, a ``block numbering area''
was a statistical subdivision created for grouping and numbering blocks
within a county for which census tracts had not been established.
Beginning with Census 2000, the Bureau of Census assigned census tracts
in all counties, making block numbering areas unnecessary. See, e.g.,
U.S. Census Bureau, Geographic Terms and Concepts (definition of
``census tract'') available at
http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html
&log=linklog&to=http://www.census.gov/geo/www/tiger/glossry2.html#CensusTract.
As a result, we changed our definition of ``geography'' to omit the term ``block numbering area''
(Sec. Sec. 25.12(k), 228.12(k), 345.12(k), and 563e.12(j)).
The definition of ``geography'' affects assessment area delineation
and data collection and reporting. First, when delineating an
assessment area, a financial institution must include only whole
geographies. Second, data about small business, small farm, community
development, and consumer loans include loan location, which is the
geography (census tract) in which the loan or borrower is located.
Changes Resulting From Revisions to the Board's Regulation C
Prior to this joint interim rule, the CRA regulations defined a
``home mortgage loan'' to mean a ``home improvement loan'' or a ``home
purchase loan'' as defined in 12 CFR 203.2. The interagency CRA
guidance that we published clarified that this definition of ``home
mortgage loan'' also includes refinancings of home improvement and home
purchase loans. See 66 FR 36620, 36628 (July 12, 2001) (question 1
addressing Sec. Sec. ----.12(m) & 563e.12(l)).
The Board substantially revised Regulation C (12 CFR 203) in 2002,
effective January 1, 2004. 67 FR 7222 (Feb. 15, 2002). Before these
revisions, a lender could choose among four standards to determine
which refinancings to report; two of the standards considered the
purpose of the loan being refinanced. The revised Regulation C replaced
this approach with a definition of ``refinancing'' that applies
uniformly, namely, a loan is reportable as a refinancing if an
obligation satisfies and replaces another obligation, and both the
existing obligation and the new obligation are secured by a lien on a
dwelling. 12 CFR 203.2(k). Under this definition, the purpose of the
loan being refinanced is not considered. Furthermore, if the obligation
meets the definition of a ``refinancing'' under the revised Regulation
C, then it is reportable even if it is not a ``refinancing'' under
Regulation Z requiring new disclosures. See 12 CFR 226.20(a). As a
result of the revisions to Regulation C, we changed the definition of
``home mortgage loan'' in the CRA regulations to include refinancings,
as well as home purchase loans and home improvement loans, as defined
in 12 CFR 203.2.
In some cases, the new definition of ``home mortgage loan'' could
lead to ``double counting'' of certain loans because refinancings
reported under HMDA and evaluated under CRA may also be reported as
refinancings of small business or small farm loans under CRA. The
definition of ``small business loan'' under the CRA regulations
incorporates the Consolidated Report of Condition and Income (Call
Report) or Thrift Financial Report (TFR) definition of ``loans to small
businesses.'' See Sec. Sec. 25.12(u), 228.12(u), 345.12(u), and
563e.12(t). The Call Report and TFR instructions exclude from this
category loans secured by residential real estate. See Schedule RC-C,
part II, Loans to Small Businesses and Small Farms; Schedule RC-C, part
I, item 1.e.; Schedule RC-C, part I, item 4 (list of exclusions); see
also TFR Schedule SB. However, a loan secured by real estate
nonetheless is considered not secured by real estate for purposes of
the Call Report instructions if the security interest is taken ``solely
through an abundance of caution and where the terms as a consequence
have not been made more favorable than they would have been in the
absence of the lien.'' See Call Report Glossary definition of ``Loan
Secured by Real Estate.'' Thrifts, on the other hand, have the option
of reporting such loans as small business loans or home mortgage loans.
See TFR Instructions and Schedule SB.
Under this standard, a financial institution could report a loan
secured by a dwelling as a small business loan. If such a loan were to
a small business, as ``loan to small business'' is defined in the Call
Report and TFR instructions, the institution would report the loan, for
CRA purposes, as a small business loan. A refinancing of such a loan,
moreover, would be reported for CRA purposes as a refinancing of a
small business loan. If the refinancing is secured by a dwelling and it
satisfies or replaces another loan that was secured by a dwelling, the
refinancing would also be reported as a refinancing of a mortgage loan
under HMDA and, therefore, also considered as a ``home mortgage loan''
in the institution's CRA evaluation.
Similarly, some refinancings of small farm loans that are reported
as small farm loans on Schedule RC-C, part II of the Call Report and
TFR Schedule SB and, thus, are included as small farm loans for CRA
data reporting purposes,
[[Page 41185]]
are also reported as refinancings under HMDA and captured as home
mortgage loans for CRA evaluation purposes. Schedule RC-C, part II and
TFR Schedule SB require reporting of ``loans secured by farmland
(including farm residential and other improvements)'' and ``loans to
finance agricultural production and other loans to farms'' that have
original amounts of $500,000 or less. Loans in either category could be
secured by a dwelling, either primarily as part of the farmland, in the
first category, or through an abundance of caution, in the second
category. Institutions would report refinancings of such loans on the
Call Report and the TFR as loans to small farms and also under HMDA as
refinancings.
We do not anticipate that loans counted as both ``small business/
small farm loans'' and ``home mortgage loans'' will be so numerous as
to affect the typical institution's CRA rating. In the event that an
institution reports a significant number or amount of loans as both
home mortgage and small business or farm loans, examiners will consider
that overlap in evaluating the institution's performance.
Technical Correction
We also have corrected an error in the cross-reference found in
Sec. Sec. 25.27(g)(1), 228.27(g)(1), 345.27(g)(1), and 563e.27(g)(1).
Those provisions, which address the time for an agency's decision
following receipt of a completed strategic plan, previously referred
the reader to paragraph (d) of Sec. Sec. 25.27, 228.27, 345.27, or
563e.27, respectively, for a description of the materials that had to
be included with a strategic plan submission. This information is found
instead in paragraph (e) of Sec. Sec. 25.27, 228.27, 345.27, or
563e.27. Therefore, we corrected the cross-references in Sec. Sec.
25.27(g)(1), 228.27(g)(1), 345.27(g)(1), and 563e.27(g)(1) to refer to
paragraph (e) of Sec. Sec. 25.27, 228.27, 345.27, and 563e.27,
respectively.
Timing and Comments
This joint interim rule is effective immediately. Institutions must
be aware of these changes when designating their assessment areas and
collecting CRA performance data for calendar year 2004, which must be
reported by March 1, 2005. Financial institutions and others who wish
to express their views about the appropriateness of these changes are
encouraged to send comments to the agencies. We will consider the
comments and, if appropriate, address them when we adopt this joint
interim rule as a final rule.
Effective Date
The Administrative Procedure Act provides that, subject to several
exceptions, a substantive rule may not be made effective until 30 days
after publication in the Federal Register. 5 U.S.C. 553(d). However, an
agency may make a rule immediately effective upon publication if the
agency finds good cause for doing so and publishes its findings with
the rule. Likewise, section 302 of the Riegle Community Development and
Regulatory Improvement Act of 1994 (CDRI), Pub. L. 103-325, authorizes
a banking agency to issue a rule to be effective before the first day
of the calendar quarter that begins on or after the date on which the
regulations are published in final form if the agency finds good cause
for an earlier effective date. 12 U.S.C. 4802(b)(1).
This joint interim rule takes effect immediately. The agencies find
good cause to dispense with the 30-day delayed effective date pursuant
to 5 U.S.C. 553(d)(3). The agencies also have determined that good
cause exists to adopt an effective date that is before the first day of
the calendar quarter that begins on or after the date on which the
regulation is published, as would otherwise be required by section 102
of the CDRI (12 U.S.C. 4802(b)(1)). As discussed more fully earlier in
this preamble, the changes adopted in this joint interim rule merely
conform our CRA regulations to recent changes by OMB, Census, and the
Board. These changes are not substantive; the technical correction
merely corrects a cross-reference. Financial institutions must use the
new statistical area standards and definitions when adjusting
assessment area delineations and collecting loan data during calendar
year 2004 (beginning with loans made as of January 1, 2004) for
reporting by March 1, 2005. Therefore, this joint interim rule must
take effect immediately upon publication in the Federal Register in
order to eliminate potential confusion for financial institutions
attempting to comply with their 2004 data collection requirements. For
the foregoing reasons, the agencies have determined that it is
unnecessary and contrary to public interest to delay the effective date
of this joint interim rule.
Regulatory Analysis
Paperwork Reduction Act
There are no collection of information requirements in this joint
interim rule.
Regulatory Flexibility Act
Pursuant to section 605(b) of the Regulatory Flexibility Act (5
U.S.C. 605(b)), the OCC, Board, FDIC, and OTS hereby certify that this
joint interim rule will not have a significant economic impact on a
substantial number of small entities. The agencies expect that this
joint interim rule will not have significant secondary or incidental
effects on a substantial number of small entities, or create any
additional burden on small entities. This joint interim rule merely
makes a technical correction and conforms terminology in the current
CRA regulations with terms and definitions already adopted by OMB,
Census, and the Board. Accordingly, a regulatory flexibility analysis
is not required.
OCC and OTS Executive Order 12866 Determination
The OCC and the OTS have determined that this joint interim rule is
not a significant regulatory action as defined in Executive Order
12866.
OCC and OTS Unfunded Mandates Reform Act of 1995 Determination
Section 202 of the Unfunded Mandates Reform Act of 1995 (Unfunded
Mandates Act) (2 U.S.C. 1532) requires that covered agencies prepare a
budgetary impact statement before promulgating a rule that includes any
Federal mandate that may result in the expenditure by State, local, and
tribal governments, in the aggregate, or by the private sector, of $100
million or more in any one year. If a budgetary impact statement is
required, section 205 of the Unfunded Mandates Act also requires
covered agencies to identify and consider a reasonable number of
regulatory alternatives before promulgating a rule. The OCC and the OTS
have determined that this joint interim rule will not result in
expenditures by State, local, and tribal governments, or by the private
sector, of $100 million or more in any one year. Accordingly, neither
agency has prepared a budgetary impact statement or specifically
addressed the regulatory alternatives considered.
The Treasury and General Government Appropriations Act, 1999--
Assessment of Impact of Federal Regulation on Families
The FDIC has determined that this joint interim rule will not
affect family well-being within the meaning of section 654 of the
Treasury and General Government Appropriations Act, enacted as part of
the Omnibus Consolidated and Emergency Supplemental Appropriations Act
of
[[Page 41186]]
1999, Pub. L. 105-277 (5 U.S.C. 601 note).
Solicitation of Comments Regarding the Use of ``Plain Language''
Section 722 of the Gramm-Leach-Bliley Act of 1999, 12 U.S.C. 4809,
requires the agencies to use ``plain language'' in all proposed and
final rules published after January 1, 2000. We invite comments on
whether this joint interim rule is stated clearly and effectively
organized, and how we might make the regulatory text easier to read.
OCC Executive Order 13132 Determination
The OCC has determined that this joint interim rule does not have
any Federalism implications, as required by Executive Order 13132.
List of Subjects
12 CFR Part 25
Community development, Credit, Investments, National banks,
Reporting and recordkeeping requirements.
12 CFR Part 228
Banks, Banking, Community development, Credit, Investments,
Reporting and recordkeeping requirements.
12 CFR Part 345
Banks, Banking, Community development, Credit Investments,
Reporting and recordkeeping requirements.
12 CFR Part 563e
Community development, Credit, Investments, Reporting and
recordkeeping requirements, Savings associations.
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Chapter I
Authority and Issuance
0
For the reasons discussed in the joint preamble, part 25 of chapter I
of title 12 of the Code of Federal Regulations is amended as follows:
PART 25--COMMUNITY REINVESTMENT ACT AND INTERSTATE DEPOSIT
PRODUCTION REGULATIONS
0
1. The authority citation for part 25 continues to read as follows:
Authority: 12 U.S.C. 21, 22, 26, 27, 30, 36, 93a, 161, 215,
215a, 481, 1814, 1816, 1828(c), 1835a, 2901 through 2907, and 3101
through 3111.
0
2. In Sec. 25.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (g);
0
c. Redesignate paragraphs (h), (i), (j), (k), (l), and (m) as
paragraphs (g), (h), (i), (j), (k), and (l);
0
d. Revise newly redesignated paragraphs (k) and (l);
0
e. Redesignate paragraphs (n), (o), (p), and (q) as paragraphs (m),
(n), (o), and (p);
0
f. Add a new paragraph (q);
0
g. Revise paragraph (r);
0
h. Redesignate paragraphs (s), (t), (u), (v), and (w) as (t), (u), (v),
(w), and (x); and
0
i. Add a new paragraph (s) to read as follows:
Sec. 25.12 Definitions.
* * * * *
(b) Area median income means:
(1) The median family income for the MSA, if a person or geography
is located in an MSA, or for the metropolitan division, if a person or
geography is located in an MSA that has been subdivided into
metropolitan divisions; or
* * * * *
(k) Geography means a census tract delineated by the United States
Bureau of the Census in the most recent decennial census.
(l) Home mortgage loan means a ``home improvement loan,'' ``home
purchase loan,'' or a ``refinancing'' as defined in Sec. 203.2 of this
title.
* * * * *
(q) Metropolitan division means a metropolitan division as defined
by the Director of the Office of Management and Budget.
(r) MSA means a metropolitan statistical area as defined by the
Director of the Office of Management and Budget.
(s) Nonmetropolitan area means any area that is not located in an
MSA.
* * * * *
0
3.Amend Sec. 25.27(g)(1) by removing the term ``paragraph (d)'' and
adding in its place the term ``paragraph (e)''.
0
4. In Sec. 25.41, revise paragraphs (b), (c)(1) and (e)(4) to read as
follows:
Sec. 25.41 Assessment area delineation.
* * * * *
(b) Geographic area(s) for wholesale or limited purpose banks. The
assessment area(s) for a wholesale or limited purpose bank must consist
generally of one or more MSAs or metropolitan divisions (using the MSA
or metropolitan division boundaries that were in effect as of January 1
of the calendar year in which the delineation is made) or one or more
contiguous political subdivisions, such as counties, cities, or towns,
in which the bank has its main office, branches, and deposit-taking
ATMs.
(c) * * *
(1) Consist generally of one or more MSAs or metropolitan divisions
(using the MSA or metropolitan division boundaries that were in effect
as of January 1 of the calendar year in which the delineation is made)
or one or more contiguous political subdivisions, such as counties,
cities, or towns; and
* * * * *
(e) * * *
* * * * *
(4) May not extend substantially beyond an MSA boundary or beyond a
state boundary unless the assessment area is located in a multistate
MSA. If a bank serves a geographic area that extends substantially
beyond a state boundary, the bank shall delineate separate assessment
areas for the areas in each state. If a bank serves a geographic area
that extends substantially beyond an MSA boundary, the bank shall
delineate separate assessment areas for the areas inside and outside
the MSA.
* * * * *
0
5. In Sec. 25.42, revise paragraph (i) to read as follows:
Sec. 25.42 Data collection, reporting, and disclosure.
* * * * *
(i) Aggregate disclosure statements. The OCC, in conjunction with
the Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, and the Office of Thrift Supervision,
prepares annually, for each MSA or metropolitan division (including an
MSA or metropolitan division that crosses a state boundary) and the
nonmetropolitan portion of each state, an aggregate disclosure
statement of small business and small farm lending by all institutions
subject to reporting under this part or parts 228, 345, or 563e of this
title. These disclosure statements indicate, for each geography, the
number and amount of all small business and small farm loans originated
or purchased by reporting institutions, except that the OCC may adjust
the form of the disclosure if necessary, because of special
circumstances, to protect the privacy of a borrower or the competitive
position of an institution.
* * * * *
[[Page 41187]]
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM
12 CFR Chapter II
Authority and Issuance
0
For the reasons discussed in the joint preamble, part 228 of chapter II
of title 12 of the Code of Federal Regulations is amended as follows:
PART 228--COMMUNITY REINVESTMENT (REGULATION BB)
0
1. The authority citation for part 228 continues to read as follows:
Authority: 12 U.S.C. 321, 325, 1828(c), 1842, 1843, 1844, and
2901 et seq.
0
2. In Sec. 228.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (g);
0
c. Redesignate paragraphs (h), (i), (j), (k), (l), and (m) as
paragraphs (g), (h), (i), (j), (k), and (l);
0
d. Revise newly redesignated paragraphs (k) and (l);
0
e. Redesignate paragraphs (n), (o), (p), and (q) as paragraphs (m),
(n), (o), and (p);
0
f. Add a new paragraph (q);
0
g. Revise paragraph (r);
0
h. Redesignate paragraphs (s), (t), (u), (v), and (w) as (t), (u), (v),
(w), and (x); and
0
i. Add a new paragraph (s) to read as follows:
Sec. 228.12 Definitions.
* * * * *
(b) Area median income means:
(1) The median family income for the MSA, if a person or geography
is located in an MSA, or for the metropolitan division, if a person or
geography is located in an MSA that has been subdivided into
metropolitan divisions; or
* * * * *
(k) Geography means a census tract delineated by the United States
Bureau of the Census in the most recent decennial census.
(l) Home mortgage loan means a ``home improvement loan,'' ``home
purchase loan,'' or a ``refinancing'' as defined in Sec. 203.2 of this
title.
* * * * *
(q) Metropolitan division means a metropolitan division as defined
by the Director of the Office of Management and Budget.
(r) MSA means a metropolitan statistical area as defined by the
Director of the Office of Management and Budget.
(s) Nonmetropolitan area means any area that is not located in an
MSA.
* * * * *
0
3. Amend Sec. 228.27(g)(1) by removing the term ``paragraph (d)'' and
adding in its place the term ``paragraph (e)''.
0
4. In Sec. 228.41, revise paragraphs (b), (c)(1) and (e)(4) to read as
follows:
Sec. 228.41 Assessment area delineation.
* * * * *
(b) Geographic area(s) for wholesale or limited purpose banks. The
assessment area(s) for a wholesale or limited purpose bank must consist
generally of one or more MSAs or metropolitan divisions (using the MSA
or metropolitan division boundaries that were in effect as of January 1
of the calendar year in which the delineation is made) or one or more
contiguous political subdivisions, such as counties, cities, or towns,
in which the bank has its main office, branches, and deposit-taking
ATMs.
(c) * * *
(1) Consist generally of one or more MSAs or metropolitan divisions
(using the MSA or metropolitan division boundaries that were in effect
as of January 1 of the calendar year in which the delineation is made)
or one or more contiguous political subdivisions, such as counties,
cities, or towns; and
* * * * *
(e) * * *
* * * * *
(4) May not extend substantially beyond an MSA boundary or beyond a
state boundary unless the assessment area is located in a multistate
MSA. If a bank serves a geographic area that extends substantially
beyond a state boundary, the bank shall delineate separate assessment
areas for the areas in each state. If a bank serves a geographic area
that extends substantially beyond an MSA boundary, the bank shall
delineate separate assessment areas for the areas inside and outside
the MSA.
* * * * *
0
5. In Sec. 228.42, revise paragraph (i) to read as follows:
Sec. 228.42 Data collection, reporting, and disclosure.
* * * * *
(i) Aggregate disclosure statements. The Board, in conjunction with
the Office of the Comptroller of the Currency, the Federal Deposit
Insurance Corporation, and the Office of Thrift Supervision, prepares
annually, for each MSA or metropolitan division (including an MSA or
metropolitan division that crosses a state boundary) and the
nonmetropolitan portion of each state, an aggregate disclosure
statement of small business and small farm lending by all institutions
subject to reporting under this part or parts 25, 345, or 563e of this
title. These disclosure statements indicate, for each geography, the
number and amount of all small business and small farm loans originated
or purchased by reporting institutions, except that the Board may
adjust the form of the disclosure if necessary, because of special
circumstances, to protect the privacy of a borrower or the competitive
position of an institution.
* * * * *
FEDERAL DEPOSIT INSURANCE CORPORATION
12 CFR Chapter III
Authority and Issuance
0
For the reasons discussed in the joint preamble, the Board of Directors
of the FDIC amends part 345 of chapter III of title 12 of the Code of
Federal Regulations to read as follows:
PART 345--COMMUNITY REINVESTMENT
0
1. The authority citation for part 345 continues to read as follows:
Authority: 12 U.S.C. 1814-1817, 1819-1820, 1828, 1831u and 2901-
2907, 3103-3104, and 3108(a).
0
2. In Sec. 345.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (g);
0
c. Redesignate paragraphs (h), (i), (j), (k), (l), and (m) as
paragraphs (g), (h), (i), (j), (k), and (l);
0
d. Revise newly redesignated paragraphs (k) and (l);
0
e. Redesignate paragraphs (n), (o), (p), and (q) as paragraphs (m),
(n), (o), and (p);
0
f. Add a new paragraph (q);
0
g. Revise paragraph (r);
0
h. Redesignate paragraphs (s), (t), (u), (v), and (w) as (t), (u), (v),
(w), and (x); and
0
i. Add a new paragraph (s) to read as follows:
Sec. 345.12 Definitions.
* * * * *
(b) Area median income means:
(1) The median family income for the MSA, if a person or geography
is located in an MSA, or for the metropolitan division, if a person or
geography is located in an MSA that has been subdivided into
metropolitan divisions; or
* * * * *
(k) Geography means a census tract delineated by the United States
Bureau of the Census in the most recent decennial census.
(l) Home mortgage loan means a ``home improvement loan,'' ``home
[[Page 41188]]
purchase loan,'' or a ``refinancing'' as defined in Sec. 203.2 of this
title.
* * * * *
(q) Metropolitan division means a metropolitan division as defined
by the Director of the Office of Management and Budget.
(r) MSA means a metropolitan statistical area as defined by the
Director of the Office of Management and Budget.
(s) Nonmetropolitan area means any area that is not located in an
MSA.
* * * * *
0
3. Amend Sec. 345.27(g)(1) by removing the term ``paragraph (d)'' and
adding in its place the term ``paragraph (e)''.
0
4. In Sec. 345.41, revise paragraphs (b), (c)(1) and (e)(4) to read as
follows:
Sec. 345.41 Assessment area delineation.
* * * * *
(b) Geographic area(s) for wholesale or limited purpose banks. The
assessment area(s) for a wholesale or limited purpose bank must consist
generally of one or more MSAs or metropolitan divisions (using the MSA
or metropolitan division boundaries that were in effect as of January 1
of the calendar year in which the delineation is made) or one or more
contiguous political subdivisions, such as counties, cities, or towns,
in which the bank has its main office, branches, and deposit-taking
ATMs.
(c) * * *
(1) Consist generally of one or more MSAs or metropolitan divisions
(using the MSA or metropolitan division boundaries that were in effect
as of January 1 of the calendar year in which the delineation is made)
or one or more contiguous political subdivisions, such as counties,
cities, or towns; and
* * * * *
(e) * * *
* * * * *
(4) May not extend substantially beyond an MSA boundary or beyond a
state boundary unless the assessment area is located in a multistate
MSA. If a bank serves a geographic area that extends substantially
beyond a state boundary, the bank shall delineate separate assessment
areas for the areas in each state. If a bank serves a geographic area
that extends substantially beyond an MSA boundary, the bank shall
delineate separate assessment areas for the areas inside and outside
the MSA.
* * * * *
0
5. In Sec. 345.42, revise paragraph (i) to read as follows:
Sec. 345.42 Data collection, reporting, and disclosure.
* * * * *
(i) Aggregate disclosure statements. The FDIC, in conjunction with
the Board of Governors of the Federal Reserve System, the Office of the
Comptroller of the Currency, and the Office of Thrift Supervision,
prepares annually, for each MSA or metropolitan division (including an
MSA or metropolitan division that crosses a state boundary) and the
nonmetropolitan portion of each state, an aggregate disclosure
statement of small business and small farm lending by all institutions
subject to reporting under this part or parts 25, 228, or 563e of this
title. These disclosure statements indicate, for each geography, the
number and amount of all small business and small farm loans originated
or purchased by reporting institutions, except that the FDIC may adjust
the form of the disclosure if necessary, because of special
circumstances, to protect the privacy of a borrower or the competitive
position of an institution.
* * * * *
DEPARTMENT OF THE TREASURY
Office of Thrift Supervision
12 CFR Chapter V
Authority and Issuance
0
For the reasons discussed in the joint preamble, part 563e of chapter V
of title 12 of the Code of Federal Regulations is amended as follows:
PART 563e--COMMUNITY REINVESTMENT
0
1. The authority citation for part 563e continues to read as follows:
Authority: 12 U.S.C. 1462a, 1463, 1464, 1467a, 1814, 1816,
1828(c), and 2901 through 2907.
0
2. In Sec. 563e.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (f);
0
c. Redesignate paragraphs (g), (h), (i), (j), (k), and (l) as
paragraphs (f), (g), (h), (i), (j), and (k);
0
d. Revise newly redesignated paragraphs (j) and (k);
0
e. Redesignate paragraphs (m), (n), (o), and (p) as paragraphs (l),
(m), (n), and (o);
0
f. Add a new paragraph (p);
0
g. Revise paragraph (q);
0
h. Redesignate paragraphs (r), (s), (t), (u), and (v) as (s), (t), (u),
(v), and (w); and
0
i. Add a new paragraph (r) to read as follows:
Sec. 563e.12 Definitions.
* * * * *
(b) Area median income means:
(1) The median family income for the MSA, if a person or geography
is located in an MSA, or for the metropolitan division, if a person or
geography is located in an MSA that has been subdivided into
metropolitan divisions; or
* * * * *
(j) Geography means a census tract delineated by the United States
Bureau of the Census in the most recent decennial census.
(k) Home mortgage loan means a ``home improvement loan,'' ``home
purchase loan,'' or a ``refinancing'' as defined in Sec. 203.2 of this
title.
* * * * *
(p) Metropolitan division means a metropolitan division as defined
by the Director of the Office of Management and Budget.
(q) MSA means a metropolitan statistical area as defined by the
Director of the Office of Management and Budget.
(r) Nonmetropolitan area means any area that is not located in an
MSA.
* * * * *
0
3. Amend Sec. 563e.27(g)(1) by removing the term ``paragraph (d)'' and
adding in its place the term ``paragraph (e)''.
0
4. In Sec. 563e.41, revise paragraphs (b), (c)(1) and (e)(4) to read
as follows:
Sec. 563e.41 Assessment area delineation.
* * * * *
(b) Geographic area(s) for wholesale or limited purpose savings
associations. The assessment area(s) for a wholesale or limited purpose
savings association must consist generally of one or more MSAs or
metropolitan divisions (using the MSA or metropolitan division
boundaries that were in effect as of January 1 of the calendar year in
which the delineation is made) or one or more contiguous political
subdivisions, such as counties, cities, or towns, in which the savings
association has its main office, branches, and deposit-taking ATMs.
(c) * * *
(1) Consist generally of one or more MSAs or metropolitan divisions
(using the MSA or metropolitan division boundaries that were in effect
as of January 1 of the calendar year in which the delineation is made)
or one or more contiguous political subdivisions, such as counties,
cities, or towns; and
* * * * *
(e) * * *
* * * * *
(4) May not extend substantially beyond an MSA boundary or beyond a
state boundary unless the assessment area is located in a multistate
MSA. If
[[Page 41189]]
a savings association serves a geographic area that extends
substantially beyond a state boundary, the savings association shall
delineate separate assessment areas for the areas in each state. If a
savings association serves a geographic area that extends substantially
beyond an MSA boundary, the savings association shall delineate
separate assessment areas for the areas inside and outside the MSA.
* * * * *
0
5. In Sec. 563e.42, revise paragraph (i) to read as follows:
Sec. 563e.42 Data collection, reporting, and disclosure.
* * * * *
(i) Aggregate disclosure statements. The OTS, in conjunction with
the Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, and the Office of the Comptroller of the
Currency, prepares annually, for each MSA or metropolitan division
(including an MSA or metropolitan division that crosses a state
boundary) and the nonmetropolitan portion of each state, an aggregate
disclosure statement of small business and small farm lending by all
institutions subject to reporting under this part or parts 25, 228, or
345 of this title. These disclosure statements indicate, for each
geography, the number and amount of all small business and small farm
loans originated or purchased by reporting institutions, except that
the OTS may adjust the form of the disclosure if necessary, because of
special circumstances, to protect the privacy of a borrower or the
competitive position of an institution.
* * * * *
Dated: June 21, 2004.
John D. Hawke, Jr.,
Comptroller of the Currency.
By order of the Board of Governors of the Federal Reserve
System, July 1, 2004.
Jennifer J. Johnson,
Secretary of the Board.
Dated: June 28, 2004.
By Order of the Board of Directors of the Federal Deposit
Insurance Corporation.
Valerie J. Best,
Assistant Executive Secretary.
Dated: May 24, 2004.
By the Office of Thrift Supervision.
James E. Gilleran,
Director.
[FR Doc. 04-15526 Filed 7-7-04; 8:45 am]
BILLING CODE 4810-33-P