Federal regulators periodically examine institutions for their Community Reinvestment Act (CRA) performance. Under the existing rule, the CRA performance evaluation consists of the lending, services, and investment tests, with each measuring the financial institution’s responsiveness to community needs relative to those areas, including the needs of low- and moderate-income (LMI) neighborhoods and households. The overall CRA rating assigned by the examining agency is a critical measure of not only the institution’s investment in their communities, but also the institution’s ability to meet strategic objectives. Indeed, a poor overall CRA rating can bring with it heightened regulatory scrutiny, restrictions on strategic growth (e.g., mergers and acquisitions), and significant reputational risks.

To prepare for these critical examinations, institutions take many measures including performing a CRA self-assessment. Performing a self-assessment entails performing the lending, services, and investment tests similar to how regulators would during an exam, analyzing data, and identifying gaps or areas for improvement ahead of the actual exam.

Asurity Advisors leveraged the RiskExec software platform and resident CRA subject matter experts to facilitate the evaluation of the bank’s lending. Investment, and community development services performance. Asurity Advisors also aided the bank in developing performance context to provide additional insights into its ability to meet its CRA obligations and provided the bank with best practices for data collection and aggregation. This resulted in the delivery of value-added support in anticipation of the upcoming exam. Asurity Advisors completed the CRA self-assessment, provided performance conclusions and recommendations for future exam preparation, and gave the bank advice on strategic direction for any gaps identified.