Financial Services Modernization Act

Community Reinvestment Act Amendments in the Gramm-Leach Act

Sunshine Requirements

• Requires full public disclosure of all CRA agreements.

• Requires each bank and each non-bank party to a CRA agreement to make a public report each year on how the money and other resources involved in the agreement were used.

Small Bank Regulatory Relief

• Applies to small banks and savings and loans, with no more than $250 million in assets.

• Small banks and S&Ls having received an outstanding rating at their most recent CRA exam shall not receive a routine CRA exam more often than once each 5 years.

• Small banks and S&Ls having received a satisfactory rating at their most recent CRA exam shall not receive a routine CRA exam more often than once each 4 years.

Preservation of Current Law

• Clarifies that nothing in the act repeals any provision of the CRA.

CRA Compliance Check

• The Federal Reserve may not permit a company to form a financial holding company if any of its banks or S&Ls did not receive at least a satisfactory rating in its most recent CRA exam.

• No bank or financial holding company may commence new activities authorized under the Gramm-Leach Act if any bank, or bank affiliate of a financial holding company, received less than satasfactory rating at its most recent CRA exam.

Federal Reserve Study

• Directs the Federal Reserve Board to conduct a study of the default rates, delinquency rates, and profitability of CRA loans.

Treasury Study

• Directs the Treasury, in consultation with the bank regulators, to study the extent to which adequate services are being provided as intended by the CRA.