District Circular Letters
September 8, 1998
COMMUNITY REINVESTMENT ACT:
AVAILABILITY OF LENDING DATA
INTERAGENCY CRA RATINGS DATABASE
To Member Banks, Nonmember Banks,
and Others Concerned
in the Twelfth Federal Reserve Districtt
FFIEC Data on Small Business, Small Farm and Community Development
Lending
The Federal Financial Institutions Examination Council (FFIEC) has announced
the availability of data on small business, small farm, and community
development lending reported by commercial banks and savings associations
(including savings banks and savings and loan associations) pursuant to
the Community Reinvestment Act (CRA).
As revised in 1995, the regulations that implement the CRA generally
require the reporting of data on these types of lending by independent
commercial banks and savings associations having total assets of $250
million or more, and by commercial banks and savings associations of any
size if owned by a holding company having assets of $1 billion or more.
Analysis of Call Report data indicates that reporting institutions account
for about two-thirds of the small business loans and one-fifth of the
small farm loans extended by all commercial banks and savings associations.
From the data reported, the FFIEC prepares a disclosure statement, in
electronic form, for each reporting commercial bank and savings association.
The FFIEC also prepares an aggregate disclosure statement for each of
the metropolitan statistical areas and each of the nonmetropolitan counties
in the United States and Puerto Rico.
Small Business and Small Farm Loan Data Highlights
The 1997 data reflect originations and purchases of small business and
small farm loans from 1,896 institutions, including 1,421 commercial banks
and 475 savings associations. (See below for instructions on receiving
a detailed fact sheet and related tables.) A total of 2.6 million small
business loans, totaling $159 billion, and 213,000 small farm loans, totaling
$11 billion, were reported for 1997. Measured by number of loans, 50 percent
of the reported small business loans and 90 percent of small farm loans
were extended to borrowers with revenues of $1 million or less. For small
business loans, this proportion has decreased 6 percentage points from
the 56 percent reported in 1996.
The vast majority (about 87 percent, by number of loans) of small business
and small farm loans were for amounts under $100,000. Small business loans
are heavily concentrated in central city and suburban areas, as are both
the U.S. population and U.S. businesses. The variation in small business
lending among census tracts grouped into income categories generally parallels
the distribution of the population and businesses among these categories.
Reporting institutions that have assets of more than $750 million (594
of the 1,896 institutions reporting) extend a greater number of small
business loans in lower income areas than do other institutions. Most
small farm loans are made in rural areas regardless of income.
Community Development Lending Data Highlights
For 1997, commercial banks and savings associations reported community
development lending that totaled nearly $19 billion. Compared with small
business and small farm lending, the typical community development loan
was relatively large ($745,000).
A community development loan has as its primary purpose affordable housing
for low- or moderate-income individuals, community services targeted to
these individuals, activities that promote economic development by financing
small businesses and small farms, and activities that revitalize or stabilize
low- or moderate-income geographies. In general, a community development
loan has not been reported for CRA purposes as a consumer, home-mortgage,
small business, or small farm loan (except for a multifamily dwelling
loan reported under the Home Mortgage Disclosure Act (HMDA)).
CRA Order Forms
An order form for CRA items, with descriptions of the various reports
and formats available, is enclosed. An order form for other data available
from the FFIEC (including data on home mortgage loans, reported under
HMDA), and the location of the central depositories can be found at the
FFIEC Web site (www.ffiec.gov).
FFIEC CRA Rating Search Database
The FFIEC has added a new CRA Rating Search function to its Internet
site (http://www.ffiec.gov/cracf/crarating/main.cfm).
This web site provides the latest CRA ratings of financial institutions
regulated by the Federal Reserve, the Office of the Comptroller of the
Currency, the Federal Deposit Insurance Corporation, and the Office of
Thrift Supervision. The site allows consumers, researchers, community
groups, and others to perform queries against a population of CRA ratings
from all four regulatory agencies. The database contains CRA ratings for
all examinations dating back to July 1, 1990, and will be updated quarterly
with recent examination ratings.
The CRA requires the federal banking and thrift regulators, in connection
with their examinations of certain depository institutions, to assess
the institutions' CRA performances. A financial institution's performance
is evaluated in the context of information about the institution (financial
conditions and business strategies), its community (demographic and economic
data), and its competitors. Upon completion of a CRA examination, an overall
CRA rating is assigned using a four-tiered rating system (Outstanding,
Satisfactory, Needs to Improve, and Substantial Noncompliance).
The FFIEC Interagency CRA Rating Search allows users to search CRA Rating,
Regulatory Agency ID Number, Bank Name, Regulatory Agency, City, State,
Examination Method, Examination Period, and Asset Range. The results of
a search can be customized via on-screen selection of fields to display,
and by sort order. Links to the individual agency's Web sites are also
provided.
Copies
Copies of the FFIEC fact sheet, "Findings from Analysis of Nationwide
Summary Statistics for 1997 Community Reinvestment Act Data," with
illustrative tables, are available from our Corporate Services Department.
To request copies to be sent via mail, please call (415) 974-2748.
To request copies to be sent via fax, please call (415) 974-3333,
and specify document number 4226. This material is also
available via the FFIEC Web site (www.ffiec.gov).
Additional Information
For additional information regarding these matters, please contact our
Banking Supervision and Regulation Department, at (415) 974-2967.
FEDERAL RESERVE BANK OF SAN FRANCISCO
Attachment (Please note: Not all of the referenced attachments are
available online.)
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