Riegle - Neal interstate banking and Branching Efficiency Act of 1994 - wikipedia Riegle - Neal interstate banking and Branching Efficiency Act of 1994 The Riegle - Neal Interstate Banking and Branching Efficiency Act of 1994 ( IBBEA ) amended the laws governing federally chartered banks in order to restore the laws ' competitiveness with the recently relaxed laws governing state - chartered banks. The goal was the return to a balance between the benefits of a state bank charter versus a federal bank charter. Among other notable changes, the Act stipulated that a federally chartered bank wishing to expand must first undergo a review of its Community Reinvestment Act compliance. Expansion of the Community Reinvestment Act This section is a candidate to be copied to Wikisource. If the section can be edited into encyclopedic content, rather than merely a copy of the source text, please do so and remove this message. Otherwise, you can help by formatting it per the Wikisource guidelines in preparation for the duplication. Three sections of the IBBEA address and expand the Community Reinvestment Act. In section 107 ( `` EQUALIZING COMPETITIVE OPPORTUNITIES FOR UNITED STATES AND FOREIGN BANKS '' ) : ( f ) MEETING COMMUNITY CREDIT NEEDS. Section 5 ( a ) of the International Banking Act of 1978 ( 12 U.S.C. 3103 ( a ) ) ( as amended by section 104 of this Act ) is amended by inserting after paragraph ( 7 ) the following new paragraph : ( 8 ) CONTINUING REQUIREMENT FOR MEETING COMMUNITY CREDIT NEEDS AFTER INITIAL INTERSTATE ENTRY BY ACQUISITION. ( A ) IN GENERAL. -- If a foreign bank acquires a bank or a branch of a bank, in a State in which the foreign bank does not maintain a branch, and such acquired bank is, or is part of, a regulated financial institution ( as defined in section 803 of the Community Reinvestment Act of 1977 ), the Community Reinvestment Act of 1977 shall continue to apply to each branch of the foreign bank which results from the acquisition as if such branch were a regulated financial institution. In section 109 ( `` PROHIBITION AGAINST DEPOSIT PRODUCTION OFFICES '' ) : ( b ) GUIDELINES FOR MEETING CREDIT NEEDS. Regulations issued under subsection ( a ) shall include guidelines to ensure that interstate branches operated by an out - of - State bank in a host State are reasonably helping to meet the credit needs of the communities which the branches serve. ( c ) LIMITATION ON OUT - OF - STATE LOANS. ( 1 ) LIMITATION. -- Regulations issued under subsection ( a ) shall require that, beginning no earlier than 1 year after establishment or acquisition of an interstate branch or branches in a host State by an out - of - State bank, if the appropriate Federal banking agency for the out - of - State bank determines that the bank 's level of lending in the host State relative to the deposits from the host State ( as reasonably determinable from available information including the agency 's sampling of the bank 's loan files during an examination or such data as is otherwise available ) is less than half the average of total loans in the host State relative to total deposits from the host State ( as determinable from relevant sources ) for all banks the home State of which is such State -- ( A ) the appropriate Federal banking agency for the out - of - State bank shall review the loan portfolio of the bank and determine whether the bank is reasonably helping to meet the credit needs of the communities served by the bank in the host State ; and ( B ) if the agency determines that the out - of - State bank is not reasonably helping to meet those needs ( i ) the agency may order that an interstate branch or branches of such bank in the host State be closed unless the bank provides reasonable assurances to the satisfaction of the appropriate Federal banking agency that the bank has an acceptable plan that will reason ably help to meet the credit needs of the communities served by the bank in the host State, and ( ii ) the out - of - State bank may not open a new interstate branch in the host State unless the bank provides reasonable assurances to the satisfaction of the appropriate Federal banking agency that the bank will reasonably help to meet the credit needs of the community that the new branch will serve. (... ) ( 2 ) CONSIDERATIONS. -- In making a determination under paragraph ( 1 ) ( A ), the appropriate Federal banking agency shall consider -- ( A ) whether the interstate branch or branches of the out - of - State bank were formerly part of a failed or failing depository institution ; ( B ) whether the interstate branch was acquired under circumstances where there was a low loan - to - deposit ratio because of the nature of the acquired institution 's business or loan portfolio ; ( C ) whether the interstate branch or branches of the out - of - State bank have a higher concentration of commercial or credit card lending, trust services, or other specialized activities ; ( D ) the ratings received by the out - of - State bank under the Community Reinvestment Act of 1977 ; (... ) Section 110 ( `` COMMUNITY REINVESTMENT ACT EVALUATION OF BANKS WITH INTERSTATE BRANCHES '' ) amends the Community Reinvestment Act itself to include a new section regarding the method of evaluating the compliance of banks with branches in more than one state. Effect Newly formed firms used less outside debt financing and invested less, suggesting that greater banking competition increased financial constraints for these firms. These effects diminished and ultimately reversed as firms aged. References Jump up ^ IBBEA summary Jump up ^ IBBEA full text ( final version ) Jump up ^ IBBEA sections 107 and 110 Jump up ^ H.R. 3841 ( final version ) page 24 Jump up ^ H.R. 3841 ( final version ) pages 25 - 26 Jump up ^ H.R. 3841 ( final version ) page 27 - 28 Jump up ^ R. Zarutskie, Evidence on the effects of bank competition on firm borrowing and investment, Journal of Financial Economics 81, 2006 http://www.ct.gov/dob/cwp/view.asp?a=2235&q=297892 Bank regulation in the United States Federal authorities Consumer Financial Protection Bureau Farm Credit Administration Federal Deposit Insurance Corporation Federal Financial Institutions Examination Council Federal Housing Finance Agency Federal Reserve Board of Governors Financial Stability Oversight Council National Credit Union Administration Office of the Comptroller of the Currency Major federal legislation Independent Treasury Act National Bank Act Federal Reserve Act McFadden Act 1933 Banking Act Glass -- Steagall Act Federal Credit Union Act Bank Holding Company Act Interest Rate Control Act of 1966 Truth in Lending Act Bank Secrecy Act Fair Credit Reporting Act Home Mortgage Disclosure Act Community Reinvestment Act Electronic Fund Transfer Act Financial Institutions Regulatory and Interest Rate Control Act of 1978 Monetary Control Act Depository Institutions Act Competitive Equality Banking Act of 1987 FIRREA FDICIA Truth in Savings Act Riegle - Neal IBBEA Gramm -- Leach -- Bliley Act Fair and Accurate Credit Transactions Act Emergency Economic Stabilization Act Credit CARD Act Dodd - Frank Federal Reserve Board regulations Extensions of Credit by Federal Reserve Banks ( Reg A ) Equal Credit Opportunity ( Reg B) Home Mortgage Disclosure ( Reg C ) Reserve Requirements for Depository Institutions ( Reg D ) Electronic Fund Transfer ( Reg E ) Limitations on Interbank Liabilities ( Reg F ) International Banking Operations ( Reg K ) Consumer Leasing ( Reg M ) Loans to Insiders ( Reg O ) Privacy of Consumer Financial Information ( Reg P ) Prohibition Against the Paying of Interest on Demand Deposits ( Reg Q ) Credit by Brokers and Dealers ( Reg T ) Credit by Banks and Persons Other Than Brokers or Dealers for the Purpose of Purchasing or Carrying Margin Stock ( Reg U ) Transactions Between Member Banks and Their Affiliates ( Reg W ) Borrowers of Securities Credit ( Reg X ) Truth in Lending ( Reg Z ) Unfair or Deceptive Acts or Practices ( Reg AA ) Community Reinvestment ( Reg BB ) Availability of Funds and Collection of Checks ( Reg CC ) Truth in Savings ( Reg DD ) Types of bank charter Credit union Federal savings association Federal savings bank National bank State bank State authorities California Colorado Florida Illinois Maryland Michigan New Jersey New York Ohio Oklahoma Oregon Pennsylvania Tennessee Virginia Terms Call report CAEL Rating CAMELS rating system Thrift Financial Report Other topics Banking in the United States Fair debt collection History of central banking in the United States Wildcat banking Portal Retrieved from `` https://en.wikipedia.org/w/index.php?title=Riegle-Neal_Interstate_Banking_and_Branching_Efficiency_Act_of_1994&oldid=723060810 '' Categories : Copy section to Wikisource 1994 in law United States federal banking legislation United States housing bubble Mortgage industry of the United States Community development Urban economics Urban politics in the United States Mortgage legislation Banking in the United States Talk About Wikipedia Add links This page was last edited on 31 May 2016, at 19 : 13. 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Question: one result of the riegle-neal interstate banking and branching efficiency act was that
Answer: relaxed laws governing state-chartered banks