It’s full steam ahead on the Office of the Comptroller of the Currency’s Community Reinvestment Act proposal.
Comptroller of the Currency Joseph Otting said Wednesday that he doesn’t see a compromise with the Federal Reserve on the Community Reinvestment Act before the OCC and the Federal Deposit Insurance Corp. release their joint final rule, despite a key Fed official’s call for an interagency process.
“There are limited ways the Fed could catch up with us,” Otting told reporters at a press event. “My thought or vision is that we will do a joint OCC, FDIC rule, and then the Fed will have to make a determination whether they want to ultimately pick what we’ve done, or modify for the 15 percent of banks that they regulate on” the Community Reinvestment Act.
At that point, Otting said the Fed could “stick with the current format” or figure out “something similar” to the OCC proposal.
The Community Reinvestment Act, which governs lending to low-income areas, hasn’t been updated in a quarter century.
Earlier this month, Federal Reserve Governor Lael Brainard released her own version of a Community Reinvestment Act proposal that challenged a few points of the FDIC and OCC version, including arguing against the FDIC and OCC’s proposed uniform standard. The Brainard plan also suggested another test to satisfy Community Reinvestment Act requirements for larger banks that would measure how they bolster communities overall.
“It’s definitely extremely important to eventually find common ground and have one interagency rule,” Brainard said in a Jan. 8 speech at the Urban Institute, where she unveiled her plan. “We also want to make sure any rulemaking we do, we feel really confident about that rulemaking furthering the core purposes of the statute.”
But Otting, who has made rewriting the Community Reinvestment Act a top priority for his tenure at the OCC, said there’s no chance of either extending the 60-day comment period, which ends March 9, or finding a middle ground between the Fed and the OCC’s visions for the rule’s overhaul.
Otting will likely face criticism from House Democrats on the OCC’s Community Reinvestment Act proposal when he is set to testify in front of the House Financial Services Committee next week. In an unusual move, panel Chair Maxine Waters (D-Calif.) last month organized a caravan to an FDIC board meeting, where regulators discussed the proposal.
The Federal Reserve Board of Governors declined to comment.