CSBS Issue Briefings - August 2020

State regulators are the primary supervisor for the vast majority of lenders required to report loan data under HMDA. The data serves as the basis for Community Reinvestment Act and fair lending reviews undertaken by federal and state regulators. Working through the Federal Financial Institutions Examination Council Task Force on Consumer Compliance, state regulators pushed successfully for an interagency approach to supervision of HMDA reporting compliance. Prior to 2018, each agency followed its own exam procedures and data resubmission guidelines. • State regulators support the statutory intent of HMDA and endorse the steps taken by the CFPB to reduce burden on small financial institutions. • The relationship lending model of small community banks should not be subject to the same amount of scrutiny as large, global institutions. • Excessive reporting requirements impose a disproportionate cost burden on those small reporters, especially community banks. • Methods for analyzing HMDA compliance should be transparent and consistent across regulators. • While some of these concerns have been abated by the new transaction volume thresholds (in place as of October 2019), there are still more efforts that can be made to reduce burden. Talking Points

SME Contact: Daniel Schwartz, Director, Policy Development: (202) 728-5742 or DSchwartz@csbs.org

Date Updated: 08/25/2020

FOR STATE REGULATOR USE ONLY