OCC hits brakes on rollout of Trump-era CRA rule

WASHINGTON — The Office of the Comptroller of the Currency on Tuesday halted the implementation of its 2020 rule overhauling the Community Reinvestment Act.

“The OCC has determined that it will reconsider the June 2020 rule,” the agency said in a bulletin. The move was widely anticipated by analysts after President Biden's victory in November, and came just days after the administration recent appointment acting Comptroller Michael Hsu.

In the bulletin, the OCC wrote that the decision to suspend compliance deadlines for the regulation “will provide for an orderly reconsideration of the June 2020 rule” as well as “provide the OCC with the opportunity to consider additional stakeholder input, to evaluate issues and questions that have been raised, to reassess the necessary data, and to take additional regulatory action, as appropriate.”

In addition to reconsidering the entire rule, the OCC said it will "not object" to banks ending efforts to comply with the most significant changes that are due to go into effect starting in 2023. The agency also said it will not finalize a proposed rule from December to establish new benchmarks for CRA scoring, and will discontinue an information collection request announced in December.

Bloomberg News

While the rule has technically been in effect since October after being finalized in May 2020, the regulation’s most significant changes and compliance requirements were not due to take effect until 2023 or 2024, depending on the size of the bank.

The rule will not be thrown out entirely, however. The OCC said that it would “continue to implement the provisions of the June 2020 CRA rule that had a compliance date of October 1, 2020,” which includes the agency’s illustrative list of activities likely to qualify for CRA credit.

The move marks the end of one of the Trump administration’s most controversial regulatory pushes in financial policy. Just this month, a coalition of financial industry groups called on the OCC to withdraw the rule in the hopes that the agency will join the Federal Deposit Insurance Corp. and Federal Reserve in issuing an interagency rule to reform the 1977 anti-redlining law.