+--------+---+----------------------+--------+------------------------+---+
| # O    | # |                      |        |                        | # |
|        | # |                      |        |                        |   |
| ##     | # |                      |        |                        |   |
|        | # |                      |        |                        | # |
|        |   |                      |        |                        |   |
|        | O |                      |        |                        |   |
|        | C |                      |        |                        | # |
|        | C |                      |        |                        | # |
|        |   |                      |        |                        |   |
|        | 2 |                      |        |                        |   |
|        | 0 |                      |        |                        |   |
|        | 0 |                      |        |                        |   |
|        | 6 |                      |        |                        |   |
|        | - |                      |        |                        |   |
|        | 1 |                      |        |                        |   |
|        | 6 |                      |        |                        |   |
+--------+---+----------------------+--------+------------------------+---+
|        | * |                      |        |                        |   |
|        | * |                      |        |                        |   |
|        | O |                      |        |                        |   |
|        | C |                      |        |                        |   |
|        | C |                      |        |                        |   |
|        | B |                      |        |                        |   |
|        | U |                      |        |                        |   |
|        | L |                      |        |                        |   |
|        | L |                      |        |                        |   |
|        | E |                      |        |                        |   |
|        | T |                      |        |                        |   |
|        | I |                      |        |                        |   |
|        | N |                      |        |                        |   |
|        | * |                      |        |                        |   |
|        | * |                      |        |                        |   |
+--------+---+----------------------+--------+------------------------+---+
| ## Com |   |                      |        |                        |   |
| ptroll |   |                      |        |                        |   |
| er of  |   |                      |        |                        |   |
| the Cu |   |                      |        |                        |   |
| rrency |   |                      |        |                        |   |
|        |   |                      |        |                        |   |
| > A    |   |                      |        |                        |   |
| dminis |   |                      |        |                        |   |
| trator |   |                      |        |                        |   |
| > of   |   |                      |        |                        |   |
| > Na   |   |                      |        |                        |   |
| tional |   |                      |        |                        |   |
| >      |   |                      |        |                        |   |
|  Banks |   |                      |        |                        |   |
+--------+---+----------------------+--------+------------------------+---+
| ## Su  |   | ## Communi           | ##     | ## Interagency         |   |
| bject: |   | ty Reinvestment Act  | Descri |  Questions and Answers |   |
|        |   |                      | ption: |                        |   |
+--------+---+----------------------+--------+------------------------+---+

**TO:** Chief Executive Officers and Compliance Officers of All National
Banks,

Department and Division Heads, and All Examining Personnel

On March 10, 2006, the Office of the Comptroller of the Currency (OCC),
Board of Governors of the Federal Reserve System (Board), and the
Federal Deposit Insurance Corporation (FDIC) (collectively, the
agencies) published in the *Federal Register* "Interagency Questions and
Answers Regarding Community Reinvestment" (71 FR 12424). The Questions
and Answers primarily address topics related to changes made in the
agencies' August 2005 revisions to their CRA regulations, including
raising the "small bank" threshold to \$1 billion; creating a category
of "intermediate small banks" for CRA purposes; and expanding the
definition of "community development" to encourage greater investment in
underserved or distressed rural areas and in designated disaster areas.
The new guidance augments the Interagency Questions and Answers
Regarding Community Reinvestment that were published in the *Federal
Register* on July 12, 2001 (66 FR 36620). The Interagency Questions and
Answers are the agencies' primary vehicle for disseminating guidance
interpreting the CRA regulations.

Among the Questions and Answers that the agencies have adopted is
guidance that:

-   Explains that the agencies, generally, will consider an activity to
    revitalize or stabilize a designated disaster area if it helps to
    attract new, or retain existing, businesses or residents and is
    related to disaster recovery. The guidance provides examples of
    revitalization and stabilization activities in designated disaster
    areas.

-   States that examiners will consider bank activities related to
    disaster recovery that revitalize or stabilize a designated disaster
    area for 36 months following the date of disaster designation or
    longer, based on a demonstrable community need. The agencies plan to
    extend the 36-month time period as it applies to Gulf Coast areas
    affected by hurricanes Katrina and Rita, because of the demonstrated
    community need for long-term investment by banks to assist in
    recovery-related efforts there.

-   Explains when an activity that provides housing for middle- or
    upper-income persons may qualify as an activity that revitalizes or
    stabilizes a designated distressed or underserved rural area or a
    designated disaster area.

-   States that an activity revitalizes or stabilizes a designated
    distressed rural area if it helps to attract new, or retain
    existing, businesses or residents, and provides examples of such
    activities.

-   States that activities that revitalize or stabilize a designated
    underserved rural area include those that help meet essential
    community needs, including needs of low- or moderate-income persons,
    and provides examples of such activities.

-   Adopts a one-year lag period, following the date that geographies
    have been removed from the list of designated distressed or
    underserved rural areas, during which community development
    activities in those areas will continue to receive CRA
    consideration.

The agencies also adopted guidance that:

-   Clarifies that examiners will consider investments that were made
    prior to the current examination, but that are still outstanding.

-   States that, when evaluating a small or intermediate small bank's
    performance, examiners will consider, at the bank's request, retail
    and community development loans originated or purchased by
    affiliates, qualified investments made by affiliates, or community
    development services provided by affiliates.

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-   Explains that, generally, the presence of branches located in low-
    and moderate-income geographies will help to demonstrate the
    availability of banking services to low- and moderate-income persons
    in an evaluation of an intermediate small bank's community
    development services.

-   Added three more examples of community development services and
    qualified investments.

Interested parties are encouraged to review the attached interagency
guidance. For more information, please contact Karen Tucker, National
Bank Examiner, Compliance Policy Division, (202) 874-4428; or Margaret
Hesse, Special Counsel, Community and Consumer Law Division, (202)
874-5750.

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

Ann F. Jaedicke

Deputy Comptroller for Compliance Policy

Attachment -- [71 FR
12424](http://www.occ.treas.gov/fr/fedregister/71fr12424.pdf)

\[http://www.occ.treas.gov/fr/fedregister/71fr12424.pdf\]