Last week, the OCC and FDIC released their monthly list of CRA ratings from June of 2018. The following summary provides a few noteworthy highlights from this months ratings. As we have advocated before, one of the best ways for a financial institution to understand their requirements under the Community Reinvestment Act (CRA) is to read the performance evaluations from other financial institutions.
The list for the OCC contained a total of 20 CRA evaluations including 17 “satisfactory” ratings and three “outstanding” ratings. There were no “needs to improve” or “substantial noncompliance” ratings. The outstanding ratings included the following:
Chase Bank. This rating is classified as a “limited purpose bank” and appears to be the performance evaluation for the credit card division of Chase, as Chase Bank USA, N.A. which is a wholly owned indirect subsidiary of JPMorgan Chase & Co. This performance evaluation would be an interesting read for any financial institution that has a large credit card portfolio or a subsidiary, limited purpose (credit card) bank.
Jarrettsville FS & LA. This small bank received an outstanding rating which appears to be contributed to an excellent proportion of lending to borrowers of different incomes.
BOKF. BOKF is a large bank that received an outstanding rating on both the lending test and the investment test, while receiving a high satisfactory rating on the service test. The performance evaluation reflects an excellent level of qualified investment activity and responsiveness to assessment area neds.
The list for the FDIC contained a total of 73 CRA evaluations including 88 “satisfactory” ratings and five “outstanding” ratings. There were no “needs to improve” or “substantial noncompliance” ratings.
First Bank and Trust of Memphis. This single-office, small bank has total assets of $57.7 million. The primary products of the bank include agricultural and commercial loans, including 73.1 percent (by dollar volume) small farm loans.
Eastern Bank. Located in Boston, MA, this large bank received an outstanding rating on each of the lending, investment, and service tests.
NorthEast Community Bank. This intermediate small bank received an outstanding rating on both the lending test and the community development test. The bank’s average net loan to deposit ratio was 112.3%, which was higher then similarly situated institutions. The bank also reflected an excellent dispersion of loans in the assessment area. The bank also originated 52 community development loans of approximately $79.3 million.
Pacific Western Bank. Located in Beverly Hills, CA, this large bank received an overall outstanding rating due to an outstanding rating on the investment and service tests, as well as a high satisfactory rating on the lending test.
Central Bank. This intermediate small bank received an outstanding rating on both the lending test as well as the CD test.
Special Note: First Internet Bank of Indiana. This large bank received a satisfactory rating on their CRA performance evaluation. Of special note is that this financial institution is an internet-only bank and operates under a CRA strategic plan. A reading of this CRA performance evaluation would be insightful for any financial institution that has considered operating under a CRA strategic plan or has a significan internet banking division.
