US regulators propose CRA rule overhaul

On July 31, 2026, the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) issued a joint proposal to update fair-lending rules linked to the Community Reinvestment Act (CRA). The plan outlines changes to how banks are evaluated for serving low- and moderate-income communities and adjusts which institutions are subject to the most stringent requirements.

The proposal is framed as an overhaul of the existing CRA framework. It combines revisions to bank size classifications with updates to the metrics regulators use when judging banks’ performance in meeting community credit needs.

A central feature of the proposal is a redefinition of what constitutes a small bank under the CRA. The threshold would be raised from $412 million in assets to $1 billion, significantly expanding the group of institutions classified as small banks.

Banks with between $1 billion and $10 billion in assets would be designated as "intermediate" institutions. Under this structure, regulators estimate that about 800 banks would no longer be subject to parts of the CRA regime that apply today.

With these adjustments, only about 86 banks, representing roughly 3% of institutions, would remain subject to the full extent of CRA obligations. The rest would face scaled requirements aligned with their new size classifications.

The proposed rule changes would alter how regulators examine banks’ CRA performance. Greater emphasis would be placed on lending activity in specific communities and geographies that the CRA is intended to support.

At the same time, less weight would be assigned to factors such as the number or location of branches and the volume of deposits captured. This shift is intended to center evaluations more directly on credit provision rather than physical presence measures.

The proposal would narrow the range of community development grants that can be counted toward CRA obligations. Only certain types of grants would qualify for CRA credit, tightening the criteria that banks must meet when using grant-making to support their ratings.

Banks would also be required to collect more detailed information on grant recipients. This would include specific data such as recipient addresses, giving regulators more granular insight into how and where community development funds are being deployed.

The OCC and FDIC plan to publish the proposed changes for public comment. The process will include a formal comment period described as lasting 60 days, during which banks, community groups, and other stakeholders can provide feedback.

After the comment period, the agencies will review submissions before determining whether and how to finalize the rule. No final changes will take effect until that rulemaking process is completed.