We have been encouraging banks to develop Community Needs Assessments for their AA's. As AR points out, the first step in establishing you are fulfilling the needs of the community is to identify those needs. How can you demonstrate to examiners that your CD activity is adequate when you have no documentation about those needs?

When we conduct Community Needs Assessments for banks, in addition to the local credit market data (HMDA, small business, small farm and reported CD lending) and demographic data, we interview at least two dozen community groups to get a narrative of what community leaders recognize the needs of the community are. This adds perspective to the "statistical picture" and creates a better understanding of what your institution can do to help your communities with your financial expertise and financial resources.

I am certain examiners appreciate this kind of effort. The examiners have only a limited period of time to develop a picture of the community. Your institutions have been there for decades or more. Don't wait for examiners to develop the picture. Paint it yourself!

This is the exact path I went down Anon. I actually got word earlier today they are changing our rating to satisfactory. Unfortunately, I can't say for sure what made them change their mind, but I'm glad they did. I really did not want this to end up in Washington.

Congratulations on a hard won rating! I am sure you are so pleased they assigned CRA to you at the last minute.

Amen, congrats ACB

Glad it turned out positively. They probably changed their mind as people up the flagpole started asking questions, considered the wording in the regualation and Qs&As, saw you had a needs assessment, and started feeling a little squeemish about rating the bank NTI. It happens.

That's great news ACB!

Thanks guys. It was a battle, but at least it ended well. I am already taking measures to ensure this doesn't happen again.