A bank has been criticized by an examiner for less than satisfactory CRA performance. The bank must show improvement in its commitment to CRA. For the examiner, what would be LEAST effective in demonstrating the change?
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A. B. C. D.A
The Community Reinvestment Act (CRA) is a federal law that requires banks to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods. Banks are evaluated by examiners to determine whether they are fulfilling their obligations under the CRA. If a bank is found to have less than satisfactory CRA performance, it must show improvement in its commitment to CRA.
Out of the options provided, informing the examiner that the bank does not plan to acquire or merge with another bank, so CRA is not a priority would be the least effective way to demonstrate the bank's commitment to CRA. This is because the CRA requires all banks to serve the credit needs of their communities regardless of whether they plan to acquire or merge with another bank. Furthermore, such a statement would suggest that the bank is not interested in fulfilling its obligations under the CRA, which would not help its case with the examiner.
Giving the examiner an updated CRA public file would be an effective way to demonstrate the bank's commitment to CRA. The CRA public file contains information about the bank's CRA activities and is available for public inspection. By providing an updated file to the examiner, the bank would be showing that it is actively working to meet its CRA obligations and is transparent about its activities.
Showing the examiner a list of community groups with which the bank has met in the past 24 months to discuss credit needs would also be an effective way to demonstrate the bank's commitment to CRA. This would show that the bank is actively engaging with the community to identify credit needs and is taking steps to address them.
Similarly, showing the examiner results of the bank's most recent geocoding analysis, indicating parity in the number of loans made in each census tract, would be an effective way to demonstrate the bank's commitment to CRA. This would show that the bank is making an effort to provide credit to all areas of the community, regardless of income level or demographic characteristics.
In summary, options B, C, and D would all be effective ways to demonstrate the bank's commitment to CRA, while option A would be the least effective.