metrics would be tailored to the needs of the local community. this tailoring is not possible with a uniform benchmark that applies to all banks and all communities. the large differences between assessment areas illustrate the importance of tailoring thresholds. for example, in morgan county, ohio, lmi families are 49 percent of the population, compared with 31 percent in o ’ brien county, iowa ( figure 4 ). we believe this tailored approach is empirically sound and avoids imposing arbitrary cra performance measures on a bank and its community. in order to ensure it meets standards of safety and soundness, cra lending must be evaluated in the context of the characteristics of the bank and its community. additionally, the proposed retail lending metric would automatically adjust to changes in the business cycle. as many commenters noted in response to the anpr, a uniform ratio that does not adjust with the local business cycle could provide too little incentive to make good loans during an expansion and incentives to make unsound loans during a downturn, which could be inconsistent with the safe and sound practices mandated by the cra statute. industry commenters also expressed concern that discretionary adjustments to the uniform metric are likely to lag behind the economic cycle and undermine the certainty a metric purports to provide. by contrast, the proposed retail lending metrics are calibrated to contemporaneous changes in market conditions, thereby reducing the risk of providing unsound incentives ( figure 5 ). finally, the proposed approach would continue to recognize local context in assessing a bank ’ s cra performance. if a bank receives the presumption of satisfactory by meeting or exceeding the thresholds, an examiner could consider performance context information, including the bank ’ s responsiveness to the community ’ s needs, in determining whether the bank ’ s performance is outstanding at the assessment area level. likewise, if a bank does not meet or exceed the thresholds, it would undergo a full examination, as it would currently, and could receive any level of rating, including possibly outstanding, based on the full range of performance context considerations and clear qualitative criteria. the metrics would be designed to provide greater certainty, while avoiding rigidity. retail test — evaluating retail services retail services can be extremely important to lmi communities, although they do not easily lend themselves to consistent, comparable metrics. it makes sense to use qualitative criteria related to the responsiveness of a bank ’ s products and services and its delivery systems

the proposed test would compare the combined measure of a bank ’ s community development financing relative to deposits in its local assessment area to a national average, set differently for rural and urban areas, and a local average in the bank ’ s assessment area. the lael brainard, “ the community reinvestment act : how can we preserve what works and make it better?, ” remarks delivered at the 2019 just economy conference, national community reinvestment coalition, washington, d. c., march 12, 2019, https : / / www. federalreserve. gov / newsevents / speech / brainard20190312a. htm. - 11 - national comparator would be set differently for metropolitan statistical areas and rural areas to reflect the comparatively lower average levels of financial infrastructure in rural communities ( figure 7 ). the use of a national rural / metro comparator in addition to an assessment area comparator is intended to avoid skewing incentives toward financially dense areas that are already hotly competitive and to reflect the value of community development in underserved areas. the use of these comparators would help provide consistency across evaluations and clarity regarding community development expectations for both banks and communities. it is also important to recognize that community development financing is often provided in areas that do not neatly fit within a bank ’ s assessment area. community development financing opportunities are not always easy for banks to identify and often depend on working with local nonprofits or governments to help identify projects and put together the complex financing required to bring them to fruition. stakeholder feedback emphasized banks ’ unique advantages in evaluating community development projects in the states and territories where they operate and providing the smaller - scale, more complex, and often more impactful, investments overlooked by institutional investors. for this reason, and to encourage more activity in underserved areas, it makes sense to give consideration to all of a bank ’ s community development activities in a state or territory where it has an assessment area. 12 banks want to know in advance that they will get the benefit of cra consideration in order to invest the time and effort necessary to evaluate and structure community development loans and investments. for that reason, we are sympathetic to requests for a timely process by statewide activity outside of a bank ’ s local assessment area would factor into its statewide community development rating, and regional activities would be considered at the institution level. - 12 - which banks can seek conditional examiner review of particular activities before making