§ 345.28 Assigned conclusions and ratings. ( a ) *Conclusions* — ( 1 ) *State, multistate MSA, and institution test conclusions and performance scores* — ( i ) *In general.* For each of the applicable performance tests pursuant to §§ 345.22 through 345.26 and 345.30, the FDIC assigns conclusions and associated test performance scores of “Outstanding,” “High Satisfactory,” “Low Satisfactory,” “Needs to Improve,” or “Substantial Noncompliance” for the performance of a bank in each State and multistate MSA, as applicable pursuant to paragraph (c) of this section, and for the institution.
( ii ) *Small banks.* The FDIC assigns conclusions of “Outstanding,” “Satisfactory,” “Needs to Improve,” or “Substantial Noncompliance” for the performance of a small bank evaluated under the Small Bank Lending Test in § 345.29(a)(2) in each State and multistate MSA, as applicable pursuant to paragraph (c) of this section, and for the institution pursuant to § 345.29 and appendix E to this part.
( iii ) *Banks operating under a strategic plan.* The FDIC assigns conclusions for the performance of a bank operating under a strategic plan pursuant to § 345.27 in each State and multistate MSA, as applicable pursuant to paragraph (c) of this section, and for the institution in accordance with the methodology of the plan and appendix C to this part.
( 2 ) *Bank performance in metropolitan and nonmetropolitan areas.* Pursuant to 12 U.S.C. 2906, the FDIC provides conclusions derived under this part separately for metropolitan areas in which a bank maintains one or more domestic branch offices and for the nonmetropolitan area of a State if a bank maintains one or more domestic branch offices in such nonmetropolitan area.
( b ) *Ratings* — ( 1 ) *In general.* The FDIC assigns a rating for a bank's overall CRA performance of “Outstanding,” “Satisfactory,” “Needs to Improve,” or “Substantial Noncompliance” in each State and multistate MSA, as applicable pursuant to paragraph (c) of this section, and for the institution, as provided in this section and appendices D and E to this part. The ratings assigned by the FDIC reflect the bank's record of helping to meet the credit needs of its entire community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of the bank.
( 2 ) *State, multistate MSA, and institution ratings and overall performance scores.* ( i ) For large banks, intermediate banks, small banks that opt into the Retail Lending Test in § 345.22, and limited purpose banks, the FDIC calculates and discloses the bank's overall performance score for each State and multistate MSA, as applicable, and for the institution. The FDIC uses a bank's overall performance scores described in this section to assign a rating for the bank's overall performance in each State and multistate MSA, as applicable, and for the institution, subject to paragraphs (d) and (e) of this section.
( ii ) Overall performance scores are based on the bank's performance score for each applicable performance test and derived as provided in paragraph (b)(3) of this section, as applicable, and appendix D to this part.
( 3 ) *Weighting of performance scores.* In calculating a large bank's or intermediate bank's overall performance score for each State and multistate MSA, as applicable, and the institution, the FDIC weights the performance scores for the bank for each applicable performance test as provided in paragraphs (b)(3)(i) and (ii) of this section. ( i ) *Large bank performance test weights.* The FDIC weights the bank's performance score for the performance tests applicable to a large bank as follows: ( A ) Retail Lending Test, 40 percent;
( B ) Retail Services and Products Test, 10 percent;
( C ) Community Development Financing Test, 40 percent; and
( D ) Community Development Services Test, 10 percent.
( ii ) *Intermediate bank performance test weights.* The FDIC weights the bank's performance score for the performance tests applicable to an intermediate bank as follows: ( A ) Retail Lending Test, 50 percent; and
( B ) Intermediate Bank Community Development Test or Community Development Financing Test, as applicable, 50 percent.
( 4 ) *Minimum conclusion requirements* — ( i ) *Retail Lending Test minimum conclusion.* An intermediate bank or a large bank must receive at least a “Low Satisfactory” Retail Lending Test conclusion for the State, multistate MSA, or institution to receive, respectively, a State, multistate MSA, or institution rating of “Satisfactory” or “Outstanding.”
( ii ) *Minimum of “Low Satisfactory” overall facility-based assessment area and retail lending assessment area conclusion.* ( A ) For purposes of this paragraph (b)(4)(ii)(A), the FDIC assigns a large bank an overall conclusion for each facility-based assessment area and, as applicable, each retail lending assessment area, as provided in paragraph g.2.ii of appendix D to this part.
( B ) Except as provided in § 345.51(e), a large bank with a combined total of 10 or more facility-based assessment areas and retail lending assessment areas in any State or multistate MSA, as applicable, or for the institution may not receive a rating of “Satisfactory” or “Outstanding” in that State or multistate MSA, as applicable, or for the institution, unless the bank receives an overall conclusion of at least “Low Satisfactory” in 60 percent or more of the total number of its facility-based assessment areas and retail lending assessment areas in that State or multistate MSA, as applicable, or for the institution.
( c ) *Conclusions and ratings for States and multistate MSAs* — ( 1 ) *States* — ( i ) *In general.* Except as provided in paragraph (c)(1)(ii) of this section, the FDIC evaluates a bank and assigns conclusions and ratings for any State in which the bank maintains a main office, branch, or deposit-taking remote service facility.
( ii ) *States with rated multistate MSAs.* The FDIC evaluates a bank and assigns conclusions and ratings for a State only if the bank maintains a main office, branch, or deposit-taking remote service facility outside the portion of the State comprising any multistate MSA identified in paragraph (c)(2) of this section. In evaluating a bank and assigning conclusions and ratings for a State, the FDIC does not consider activities to be in the State if those activities take place in the portion of the State comprising any multistate MSA identified in paragraph (c)(2) of this section.
( iii ) *States with non-rated multistate MSAs.* If a facility-based assessment area of a bank comprises a geographic area spanning two or more States within a multistate MSA that is not identified in paragraph (c)(2) of this section, the FDIC considers activities in the entire facility-based assessment area to be in the State in which the bank maintains, within the multistate MSA, a main office, branch, or deposit-taking remote service facility. In evaluating a bank and assigning conclusions and ratings for a State, the FDIC does not consider activities to be in the State if those activities take place in any facility-based assessment area that is considered to be in another State pursuant to this paragraph (c)(1)(iii).
( iv ) *States with multistate retail lending assessment areas.* In assigning Retail Lending Test conclusions for a State pursuant to § 345.22(h), the FDIC does not consider a bank's activities to be in the State if those activities take place in a retail lending assessment area consisting of counties in more than one State.
( 2 ) *Rated multistate MSAs.* The FDIC evaluates a bank and assigns conclusions and ratings under this part in any multistate MSA in which the bank maintains a main office, a branch, or a deposit-taking remote service facility in two or more States within that multistate MSA.
( d ) *Effect of evidence of discriminatory or other illegal credit practices* — ( 1 ) *Scope.* For each State and multistate MSA, as applicable, and the institution, the FDIC's evaluation of a bank's performance under this part is adversely affected by evidence of discriminatory or other illegal credit practices, as provided in paragraph (d)(2) of this section. The FDIC considers evidence of discriminatory or other illegal credit practices described in this section by: ( i ) The bank, including by an operating subsidiary of the bank; or
( ii ) Any other affiliate related to any activities considered in the evaluation of the bank.
( 2 ) *Discriminatory or other illegal credit practices.* For purposes of paragraph (d)(1) of this section, discriminatory or other illegal credit practices consist of the following: ( i ) Discrimination on a prohibited basis, including in violation of the Equal Credit Opportunity Act (15 U.S.C. 1691 *et seq.*) or the Fair Housing Act (42 U.S.C. 3601 *et seq.*);
( ii ) Violations of the Home Ownership and Equity Protection Act (15 U.S.C. 1639);
( iii ) Violations of section 5 of the Federal Trade Commission Act (15 U.S.C. 45);
( iv ) Violations of section 1031 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (12 U.S.C. 5531, 5536);
( v ) Violations of section 8 of the Real Estate Settlement Procedures Act (12 U.S.C. 2601 *et seq.*);
( vi ) Violations of the Truth in Lending Act (15 U.S.C. 1601 *et seq.*);
( vii ) Violations of the Military Lending Act (10 U.S.C. 987);
( viii ) Violations of the Servicemembers Civil Relief Act (50 U.S.C. 3901 *et seq.*); and
( ix ) Any other violation of a law, rule, or regulation consistent with the types of violations in paragraphs (d)(2)(i) through (viii) of this section, as determined by the FDIC.
( 3 ) *Agency considerations.* In determining the effect of evidence of discriminatory or other illegal credit practices described in paragraph (d)(1) of this section on the bank's assigned State, multistate MSA, and institution ratings, the FDIC will consider: ( i ) The root cause or causes of any such violations of law, rule, or regulation;
( ii ) The severity of any harm to any communities, individuals, small businesses, and small farms resulting from such violations;
( iii ) The duration of time over which the violations occurred;
( iv ) The pervasiveness of the violations;
( v ) The degree to which the bank, operating subsidiary, or affiliate, as applicable, has established an effective compliance management system across the institution to self-identify risks and to take the necessary actions to reduce the risk of noncompliance and harm to communities, individuals, small businesses, and small farms; and
( vi ) Any other relevant information.
( e ) *Consideration of past performance.* When assigning ratings, the FDIC considers a bank's past performance. If a bank's prior rating was “Needs to Improve,” the FDIC may determine that a “Substantial Noncompliance” rating is appropriate where the bank failed to improve its performance since the previous evaluation period, with no acceptable basis for such failure.