NCRC comment on OCC licensing and merger applications

April 28, 2020

RE: Docket ID OCC-2019-0024

To Whom it May Concern:

The National Community Reinvestment Coalition (NCRC), an association of 600 community-based organizations dedicated to increasing access to affordable and safe banking products in traditionally underserved communities, opposes the Office of the Comptroller of the Currency’s (OCC’s) proposed changes to its licensing manual that describes procedures for considering input from the public during the review of bank applications. The OCC will also change how it considers mergers and branch relocations that will truncate the usual analysis of CRA and convenience and needs.

These changes will make it more difficult for community organizations to offer meaningful input in a process that is legally required to ensure that approval of bank applications offer a substantial public benefit. The OCC is hampering its own ability to determine whether applications achieve a public benefit by frustrating the ability of the public to offer opinions about whether the applications will benefit their communities.

Increasing the difficulty of a community comment being deemed substantive

The OCC proposes to change its criteria for deciding if a public comment on an application should cause an application to be removed from expedited review. Expedited review promises a shorter decision-making time of 30 days for applications from banks meeting various criteria, including passing CRA ratings, qualifying them for expedited review.[1] Even if a bank meets these criteria, the OCC can remove an application from expedited review if a member of the public submits a substantive comment that raises a significant legal, policy, CRA, or other compliance issue.

The OCC proposes to rule that a comment is not substantive if it raises “a generalized opinion that a filing should or should not be approved; or (2) a conclusory statement, lacking factual or analytical support.”[2] The OCC must not implement this proposal because it would increase the ability of the OCC to issue arbitrary decisions classifying comments as non-substantive. How would the agency decide that a letter is merely a generalized opinion, lacking analytical support? It could decide, for example, that a letter, which discusses some facts, would nevertheless lack an unspecified threshold elevating consideration of facts into “analytical support.”

The application process has proceeded smoothly with the vast majority of mergers and other applications receiving expeditious approval. The agency offers no reason why it must erect new barriers to the consideration of community views.

To compound the unfairness of the higher bar for a substantive comment, the OCC proposes that it would not consider a comment substantive if it addresses an issue that the agency previously considered. Section 5.13(a)(2)(ii) would now stipulate that the agency would rule that a comment would not be substantive if it addressed an issue the agency previously resolved during an exam or application. In particular, the “concern (involved) presenting substantially the same issue in substantially the same assessment area during substantially the same time, and the OCC determines that the concern would not warrant denial or imposition of a condition on approval of the application.”[3] This again dramatically increases the arbitrariness of the OCC’s rulings. For example, a community organization could be asserting that a different type of analysis of the same data during the same time period in the same geographical areas or more emphasis on a particular loan product exhibiting significant racial or income disparities in approvals would result in a different agency conclusion.

In a recent article in the American Banker, OCC spokesperson Bryan Hubbard indicated that community groups would have a chance to resubmit a comment if the OCC had determined the comment was non-substantive.[4] However, the proposed rule does not outline any procedure whereby the OCC would inform the community group that the comment was not substantive and then provide an opportunity for re-submission. If Mr. Hubbard is accurate in his description, the final rule at the very least must describe a process for re-submission and should indicate that the OCC would explain to the commenter why the comment was not substantive.

No rationale for considering only the CRA record of the filer  

NCRC vigorously opposes the OCC’s proposal to consider only the CRA record of the filer, and not the acquired institution by adding paragraph (e)(1)(iii)(A) to section § 5.33.[5] This would be at variance with OCC’s practice and those of other agencies. NCRC notes that the merger approval of the Comptroller’s former bank, One West, included reviews of the CRA performance of both the filing bank and the bank that was acquired.[6] Likewise, in a recent Federal Reserve approval order, the Federal Reserve reviewed the CRA records of both banks involved in a merger, in this case, BB&T and Suntrust.[7]

The OCC’s break with precedent would impair the public’s ability to comment and would render the OCC unable to consider fully the public benefit of the proposed merger as required by statute. If the CRA record of only the filer is considered, the OCC would be unlikely to consider any public comments on the CRA record of the acquired bank.

Approval orders regularly review public comments on the CRA record of both the filer and the acquired bank. The reason is straightforward: only a review of both banks’ CRA performance provides a full understanding of likely future CRA performance and hence the resultant bank’s ability to meet convenience and needs. For example, if the filer had a worse CRA record than the acquired bank, then the public would want assurances that changes would occur in the filer’s CRA approach in order to continue and improve upon the record of the acquired bank. Considering only the CRA record of the filer would provide the OCC with only partial information and hamper its ability to conduct a full review of the convenience and needs factor, which would be in violation of its statutory responsibilities.

Unnecessary proposal to “memorialize” discussions between banks and community groups

The OCC proposes to require bank applicants to indicate if they have entered into a covered agreement as specified in 12 CFR 35.2, in accordance with 12 CFR 35.6 and 35.7. The CRA sunshine provision of the Gramm-Leach-Bliley Financial Modernization Act of 1999 required disclosure of covered agreements. Under covered agreements, banks promise to offer specified levels of loans, investments, and services in low- and moderate-income (LMI) communities and communities of color. Often, these agreements involve discussions and negotiations with community-based organizations.

NCRC supports disclosure of covered agreements but urge the federal bank agencies not only to require disclosure but to encourage these types of agreements during the merger application process. NCRC refers to these agreements as community benefit agreements (CBAs), which we believe is a concrete and effective means to implement the statutory requirement that mergers confer public benefits.[8] NCRC works with our members and financial institutions on a collaborative process to create CBAs where nonprofit and bank leaders discuss community needs and opportunities for CRA-related financing. CBAs commit banks to increasing CRA activity, and directing it to where it is needed most. Yet, the regulators do not have a formal process for recognizing these commitments and bank progress towards completing them.

Recognition of CBAs has gained momentum lately. CBAs negotiated with NCRC have been mentioned in four recent merger approvals as evidence of how banks are meeting the convenience and needs of communities, including in the FDIC’s approval of BB&T and SunTrust.[9] The Treasury Department recognized CBAs as an “effective tool” to “demonstrate how [merger] application[s] would benefit the communities served.”[10] The regulators should work with community groups and banks on the development of a process for recognizing CBAs during the merger application process, and for their implementation to become a factor on CRA performance evaluations. CRA examiners must recognize community benefits agreements (CBAs), and assess bank progress in implementing CBAs just as they do with conditional merger approvals.[11]

While CBAs should be encouraged and monitored, the agencies must not institute procedures that discourage or potentially harass stakeholders negotiating these important agreements. The “memorialize” proposal is an unnecessary and burdensome requirement. Under this proposal, banks would be required to submit memos recounting discussions with community groups that resulted in a covered agreement.[12] NCRC has organized discussions that have involved hundreds of groups in several meetings in a number of states. Banks may have difficulty determining what would constitute an acceptable level of memorialization. They would also probably inform community groups of this requirement, which may confuse, intimidate, and dissuade community groups from participating in discussions. Further, it is unclear what if anything, the OCC would do with memos of this type. The OCC would have the covered agreement and can review it for safety and soundness, CRA, fair lending, and other factors. Accompanying memos do not provide any additional relevant information. Therefore, a memorialization requirement would be frivolous and extraneous. The OCC must not adopt it.

In contrast, a record of pre-filing discussions and notes about subjects discussed with banks before they filed would be quite relevant. The public needs to have assurances that the merger application process is fair and transparent. Thus, any pre-filing discussions and notes on these discussions must be made publicly available when a bank submits its application. Public disclosure would also deter any unfair advantage that OCC staff may offer to banks if the pre-filing discussions remain secretive.

Branch Relocations

In § 5.3, the OCC proposal regarding short-distance relocations of branches would undermine protections for branches in low- and moderate-income (LMI) census tracts. Short-distance relocations are subject to shorter public comment periods. The agency is proposing to adjust the definition from a one-mile radius to a two-mile radius for branches in urban areas, and from two miles to four miles in the cases of rural areas. The amended definition would not apply in the case of relocations from LMI tracts to non-LMI tracts.

The amended definition should not apply anytime a branch is relocated from a LMI tract, regardless of whether the relocation is to another LMI tract or a non-LMI tract.[13] Branches are lifelines for LMI communities in terms of access to banking services and credit. Just because a bank moves a branch from one LMI tract to another does not automatically mitigate the damage. The branching situation could be quite different in the origin and destination tracts, with considerably fewer branches in the origin tracts, for example.

Moreover, just because the definitions have not changed from 1996 does not mean that are obsolete. Instead, they remain relevant because the banking landscape has not changed dramatically for residents of LMI tracts. Although LMI customers use mobile banking, they nevertheless rely on branches largely for lending transactions and those that involve complicated questions as revealed by FDIC research.[14] LMI populations also tend to be less mobile than their affluent counterparts, meaning that changes in distance from branches would disadvantage them.

Shortening comment periods pose significant obstacles for vulnerable populations in terms of learning about the proposed changes and then mobilizing resources to comment on the proposed changes. Shortening comment periods stifles public comment regarding institutions that have a legal obligation to serve the convenience and needs of the public. Finally, the OCC offers no justification for this change such as whether the current comment periods interfere in any significant manner with business operations. The public costs of the proposed changes significantly outweigh any private benefit.


The OCC is establishing needless barriers to public participation in the merger application process by making it more difficult for public comments to remove applications from a 30-day decision-making period so that they can be considered carefully by the OCC. The OCC is also discouraging the negotiation of community benefit agreements by establishing frivolous memorialization requirements that could deter community organizations from participating in the negotiation of these agreements. In addition, the OCC is constraining its own analysis of merger applications by only considering the CRA record of the filer contrary to the spirit and intent of merger application law. The proposed changes on branch relocations will make it harder for members of the public and residents in LMI communities to comment on relocations.

These changes are contrary to the spirit and purpose of bank merger law, which require a public benefit as a result of mergers. There is no better way to achieve public benefit than to encourage robust public participation in the review of merger applications. Instead, the agency would discourage public participation with these changes. The result will be fewer mergers that achieve a public benefit.

Thank you for consideration of our views on this important matter. If you have any questions, please feel free to ask myself or Josh Silver, Senior Advisor 202-628-8866.

Jesse Van Tol


The following undersigned organizations support the views expressed in this letter:


African Diaspora Directorate

Americans for Financial Reform Education Fund

National Association of American Veterans, Inc.

National NeighborWorks Association



A G Gaston Business Institute



Community Action Association of Alabama






California Coalition for Rural Housing

California Reinvestment Coalition

California Resources and Training

EAH Housing

Ephesians Community Development Center

Grounded Solutions Network

Peoples’ Self-Help Housing

Vermont Slauson EDC



Neighborhood Housing Services of Waterbury



Cornerstone West CDC

Delaware Community Reinvestment Action Council, Inc.


District of Columbia

Can I Live, Inc

Coalition for Non Profit Housing and Economic Development



Affordable Homeownership Foundation, Inc.

Community Reinvestment Alliance of South Florida

Metro North Community Development Corp.

Solita’s House, Inc.



Georgia Advancing Communities Together, Inc.



Hawai’i Alliance for Community-Based Economic Development



Chicago Community Loan Fund

Illinois People’s Action

NW HomeStart, Inc

The John Marshall Law School Fair Housing Legal Support Center, UIC John Marshall Law School



Continuum of Care Network NWI, Inc.






Multi-Cultural Development Center



MA Affordable Housing Alliance

Massachusetts Communities Action Network



Maryland Consumer Rights Coalition



Great Rivers Community Capital


Metropolitan St. Louis Equal Housing and Opportunity Council

Old North St. Louis Restoration Group



Montgomery Citizens United for Prosperity (MCUP)


North Carolina

Henderson and Company


New Jersey

New Jersey Citizen Action


New York

Association for Neighborhood and Housing Development

Center for NYC Neighborhoods

Empire Justice Center

Fair Finance Watch

Greater Rochester Community Reinvestment Coalition

PathStone Enterprise Center, Inc.

University Neighborhood Housing Program


New Mexico

Southwest Neighborhood Housing Services



City of Toledo

Corporation for Ohio Appalachian Development

Friends of the African Union

Homes on the Hill, CDC


NeighborWorks Collaborative of Ohio

New Village Corporation

Ohio CDC Association



CASA of Oregon

Housing Oregon



Allentown Housing Authority


Chester Community Improvement Project

Community Action Committee of the Lehigh Valley

Community First Fund

Fair Housing Rights Center in Southeastern PA

Greater Shiloh Church

Housing Association & Developm

Housing Association and Development Organization


Philadelphia Association of Community Development Corporations


Rhode Island

HousingWorks RI



Building Memphis




Southern Dallas Progress Community Development Corporation






Havenwoods EDC

Layton Boulevard West Neighbors


[1] See § 5.32 (d)(1) Expedited procedures for certain reorganizations of a national bank. See https://www.law.cornell.edu/cfr/text/12/5.32

[2] OCC, Notice of Proposed Rulemaking (NPRM), Licensing Amendments, Federal Register, Vol. 85, No. 64, Thursday, April 2, 2020, p. 18731.

[3] Ibid.

[4] American Banker, Will OCC plan silence some critics of bank M&A?, March 19, 2019

[5] NPRM, p. 18734.

[6] OCC letter to Joseph Otting, President and CEO of One West Bank, NA, regarding Application to Merge CIT Bank, Salt Lake City, UT with and into OneWest Bank, N.A., Pasadena, CA and Request for Waiver of Residency Requirement OCC Control Numbers: 2014-WE-Combination-139872 2015-WE-DirectorWaiver-141909, July 21, 2015, pp. 9-10, https://www.occ.gov/news-issuances/news-releases/2015/nr-occ-2015-105a.pdf

[7] Federal Reserve System, BB&T Corporation Winston-Salem, North Carolina, Order Approving the Merger of Bank Holding Company, FRB Order No. 2019-16, November 19, 2019  See page 38 for a review of BB&T’s CRA record and page 45 for Suntrust’s, https://www.federalreserve.gov/newsevents/pressreleases/files/orders20191119a1.pdf

[8] See the FDIC webpage section on the Federal Deposit Insurance Act, specifically Section 18(c)(5)(B) via https://www.fdic.gov/regulations/laws/rules/1000-2000.html

[9] FDIC Approval of BB&T- SunTrust Merger, November 2019, pgs. 9-10, 15, https://www.fdic.gov/news/news/press/2019/pr19111a.pdf.  Federal Reserve Approval of KeyBank-First Niagara Merger, July 2016, pgs. 17-18, 27, https://www.federalreserve.gov/newsevents/pressreleases/files/orders20160712a1.pdf/ Federal Reserve Approval of Huntington-FirstMerit Merger, July 2016, pg. 31, https://www.federalreserve.gov/newsevents/pressreleases/files/orders20160729a1.pdf, Federal Reserve Approval of Fifth Third-MB Financial Merger, March 2019, pgs. 14 and 20, https://www.federalreserve.gov/newsevents/pressreleases/files/orders20190306a1.pdf

[10] Treasury memo, p. 22. Available online at https://home.treasury.gov/sites/default/files/2018-04/4-3-18%20CRA%20memo.pdf

[11] OCC CRA exam of Sterling Bank, January 2017, pp. 2-3,  https://www.occ.gov/static/cra/craeval/jul17/25075.pdf

[12] NPRM, p. 18734.

[13] NPRM, p. 18730.

[14] For information on research on bank branches including the FDIC research, see Josh Silver, The importance of CRA assessment areas and bank branches, June 2018,  https://ncrc.org/the-importance-of-cra-assessment-areas-and-bank-branches/

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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