As more and more examiners are expecting fair lending training for the Board of Directors, it is important to ensure that training efforts meet the needs of directors of the Board.  Well effective board training can be similar to training for other employees of the financial institution, it is important to understand several unique factors necessary for effective director training. The following three tips can be used for providing fair lending training to the Board of Directors.

When a financial institution denies an application, Regulation B sets forth several requirements that must be met.  Among other things, financial institutions are required to notify an applicant of the denial and (as applicable) provide the applicant with a “statement of specific reasons” for denial.  One of the biggest challenges in providing the specific reasons for denial is determining which adverse action reasons should be listed on the denial notice. As Regulation B does not explain what reasons should be used, financial institutions benefit from creating an Adverse Action Reasons Chart. This article provides a sample adverse action chart that could be used by financial institutions.