On July 31, 2026, the Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC) proposed amendments to their regulations implementing the Community Reinvestment Act (CRA), a Civil Rights-era anti-redlining law.
The agencies’ proposal follows a winding regulatory and litigation history to amend CRA regulations. Most recently, the agencies issued final rules amending the CRA in 2023, which subsequently were enjoined by a federal district court in March 2024 in litigation brought by several trade associations. After a July 2025 proposal to simply rescind those rules and revert to the pre-2023 framework, the OCC and FDIC ultimately decided to pursue this new rulemaking instead.
Notably, as we previously discussed, the Federal Reserve did not join the OCC and FDIC in this proposal.
Summary of the OCC and FDIC’s proposal
The proposal would make targeted changes to several key aspects of the CRA regulations.
- Increased focus on lending, shift away from deposits
The amendments would narrow the scope of “retail banking services” under the CRA to the range and availability of an institution’s credit services and the availability and distribution of its retail banking facilities. As a result, exams would focus on lending and would exclude deposit services.
- Change to asset-size thresholds
The agencies propose to change the asset-size thresholds that determine whether a bank is treated as a small, intermediate or large bank for CRA purposes to the following:
- The small-bank threshold would rise to less than $1 billion (from $412 million).
- A new “intermediate bank” category would replace the “intermediate small bank” category and apply to institutions between $1 billion and $10 billion (the current intermediate small bank threshold range is between $412 million to $1.649 billion).
- The large bank threshold would rise to more than $10 billion (from $1.649 billion).
As a result of these changes, the proposal states that banks with $10 billion or less in assets would be subject to fewer data collection, maintenance and reporting requirements, and banks below the $1 billion small bank threshold would no longer be subject to the community development test. Specifically, the current requirement to evaluate a small or intermediate bank’s responsiveness to written complaints would be eliminated, and intermediate banks would need only a satisfactory rating on the lending component to achieve an overall satisfactory rating (rather than on both the lending and community development components).
- Shift to examining institutions’ major product lines
As part of the current lending test, large banks are generally assessed on their retail lending, which includes home mortgage, small business and small farm lending (and, at the bank’s option, or if lending is a substantial majority of its business, certain specific product lines, including motor vehicle, credit card, and other secured and unsecured loans). Small banks are evaluated only with respect to the retail lending product lines considered their “major” product lines. The proposal would extend the major product line approach to all banks, so that examiners would focus on the product lines that make up the majority of a bank’s business rather than evaluating each product line by default.
This shift has also prompted the agencies to reconsider the “limited purpose bank” category, which currently allows for certain consumer lenders (such as credit card or auto lenders) to be evaluated solely on their community development activities. Because consumer lending could now qualify as a major product line for such banks, the agencies are seeking comment as to whether the limited purpose bank designation should be eliminated altogether.
- Ensuring community development grants benefit communities
The proposal would modify how grants and donations qualify as community development (CD) activities. To qualify for CRA consideration, a grant would need to be directly used by the recipient for the primary purpose of CD, benefit the bank’s assessment area and, for large banks, be directed to a recipient whose administrative overhead costs do not exceed 15% of the grant amount. Large banks would also be required to obtain documentation substantiating compliance, including a written commitment from the recipient regarding use of funds, an attestation confirming the overhead limitation and supporting records, such as tax filings and budget information.
- Changes to community development definitions
The agencies suggested revisions to the definitions of “CD loan,” “qualifying investment” (renamed “community development investment”) and “CD service” to treat CD activities more consistently across the different performance tests. Notably, the revised CD loan definition would allow certain home mortgage, small business and small farm loans that fall outside a bank’s major product lines to count as CD loans if they otherwise meet the CD definition, effectively giving banks a second path to CRA credit for loans that would no longer be evaluated as retail lending under the major product line approach. The proposal would also add a new umbrella term, “community development activity,” covering CD grants, investments, loans and services collectively.
- Increased clarity and objectivity
The proposal would codify an optional process allowing a bank to request, in advance, agency confirmation that a specific loan, investment, grant or service would qualify as a CD activity for CRA credit, giving banks upfront certainty rather than waiting until examination to learn whether the activity counted. The agencies also propose to make the strategic plan option more accessible. Banks have previously had the option to be evaluated under a custom “strategic plan” instead of the standard tests, but the agencies acknowledge this option has been underused because the current rules are seen as complex and unclear. The proposal restructures and clarifies the strategic plan rules – including adding a new “prefiling communications” option allowing banks to consult with regulators before submitting a plan.
What the proposal leaves unchanged
Large banks would continue to be subject to lending, investment and service tests that evaluate their retail lending and services and CD activities, while small and intermediate banks would remain subject to a tailored lending test (with a CD test for intermediate banks). Banks would also retain the option to be evaluated as a wholesale or limited purpose bank or under an approved strategic plan. Also, the agencies are not proposing significant changes to the current assessment area framework, which remains largely tied to a bank’s physical location.
What’s next?
The agencies are seeking comment on each aspect of the proposal, with comments due 60 days following publication in the Federal Register.
Banks and their compliance teams may begin considering how the proposal would affect their CRA programs, including their retail banking services evaluation, treatment of CD grants and donations, asset-size category and (if applicable) strategic plan. Banks that currently rely on deposit-related services or broader retail service activities for CRA credit should pay particular attention to the proposed narrowing of retail banking services to credit services.
We will continue to monitor this rulemaking and will provide updates as the comment period progresses and as a final rule is issued.