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Federal Register / Vol. 86, No. 178 / Friday, September 17, 2021 / Proposed Rules a limited purpose bank is in effect, in accordance with 25.25b.
o Loan location. A loan is located as follows:
1 A consumer loan is located in the geography where the borrower resides;
2 A home mortgage loan is located in the geography where the property to which the loan relates is located; and 3 A small business or small farm loan is located in the geography where the main business facility or farm is located or where the loan proceeds otherwise will be applied, as indicated by the borrower.
p Loan production office means a staffed facility, other than a branch, that is open to the public and that provides lending-related services, such as loan information and applications.
q Metropolitan division means a metropolitan division as defined by the Director of the Office of Management and Budget.
r MSA means a metropolitan statistical area as defined by the Director of the Office of Management and Budget.
s Nonmetropolitan area means any area that is not located in an MSA.
t Qualified investment means a lawful investment, deposit, membership share, or grant that has as its primary purpose community development.
u Small bank1 Definition. Small bank means a bank that, as of December 31 of either of the prior two calendar years, had assets of less than $1.322
billion. Intermediate small bank means a small bank with assets of at least $330
million as of December 31 of both of the prior two calendar years and less than $1.322 billion as of December 31 of either of the prior two calendar years.
2 Adjustment. The dollar figures in paragraph u1 of this section shall be adjusted annually and published by the OCC, based on the year-to-year change in the average of the Consumer Price Index for Urban Wage Earners and Clerical Workers, not seasonally adjusted, for each twelve-month period ending in November, with rounding to the nearest million.
v Small business loan means a loan included in loans to small businesses as defined in the instructions for preparation of the Consolidated Report of Condition and Income.
w Small farm loan means a loan included in loans to small farms as defined in the instructions for preparation of the Consolidated Report of Condition and Income.
x Wholesale bank means a bank that is not in the business of extending home mortgage, small business, small farm, or consumer loans to retail customers, and for which a designation as a wholesale
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bank is in effect, in accordance with 25.25b.
Subpart BStandards for Assessing Performance 25.21 Performance tests, standards, and ratings, in general.

a Performance tests and standards.
The OCC assesses the CRA performance of a bank in an examination as follows:
1 Lending, investment, and service tests. The OCC applies the lending, investment, and service tests, as provided in 25.22 through 25.24, in evaluating the performance of a bank, except as provided in paragraphs a2, 3, and 4 of this section.
2 Community development test for wholesale or limited purpose banks. The OCC applies the community development test for a wholesale or limited purpose bank, as provided in 25.25, except as provided in paragraph a4 of this section.
3 Small bank performance standards. The OCC applies the small bank performance standards as provided in 25.26 in evaluating the performance of a small bank or a bank that was a small bank during the prior calendar year, unless the bank elects to be assessed as provided in paragraphs a1, 2, or 4 of this section. The bank may elect to be assessed as provided in paragraph a1 of this section only if it collects and reports the data required for other banks under 25.42.
4 Strategic plan. The OCC evaluates the performance of a bank under a strategic plan if the bank submits, and the OCC approves, a strategic plan as provided in 25.27.
b Performance context. The OCC
applies the tests and standards in paragraph a of this section and also considers whether to approve a proposed strategic plan in the context of:
1 Demographic data on median income levels, distribution of household income, nature of housing stock, housing costs, and other relevant data pertaining to a banks assessment areas;
2 Any information about lending, investment, and service opportunities in the banks assessment areas maintained by the bank or obtained from community organizations, state, local, and tribal governments, economic development agencies, or other sources;
3 The banks product offerings and business strategy as determined from data provided by the bank;
4 Institutional capacity and constraints, including the size and financial condition of the bank, the
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economic climate national, regional, and local, safety and soundness limitations, and any other factors that significantly affect the banks ability to provide lending, investments, or services in its assessment areas;
5 The banks past performance and the performance of similarly situated lenders;
6 The banks public file, as described in 25.43, and any written comments about the banks CRA
performance submitted to the bank or the OCC; and 7 Any other information deemed relevant by the OCC.
c Assigned ratings. The OCC assigns to a bank one of the following four ratings pursuant to 25.28 and appendix A of this part: outstanding;
satisfactory; needs to improve; or substantial noncompliance as provided in 12 U.S.C. 2906b2. The rating assigned by the OCC reflects the banks record of helping to meet the credit needs of its entire community, including lowand moderate-income neighborhoods, consistent with the safe and sound operation of the bank.
d Safe and sound operations. This part and the CRA do not require a bank to make loans or investments or to provide services that are inconsistent with safe and sound operations. To the contrary, the OCC anticipates banks can meet the standards of this part with safe and sound loans, investments, and services on which the banks expect to make a profit. Banks are permitted and encouraged to develop and apply flexible underwriting standards for loans that benefit lowor moderateincome geographies or individuals, only if consistent with safe and sound operations.
e Low-cost education loans provided to low-income borrowers. In assessing and taking into account the record of a bank under this part, the OCC considers, as a factor, low-cost education loans originated by the bank to borrowers, particularly in its assessment areas, who have an individual income that is less than 50 percent of the area median income. For purposes of this paragraph, low-cost education loans means any education loan, as defined in section 140a7 of the Truth in Lending Act 15 U.S.C. 1650a7 including a loan under a state or local education loan program, originated by the bank for a student at an institution of higher education, as that term is generally defined in sections 101 and 102 of the Higher Education Act of 1965 20 U.S.C.
1001 and 1002 and the implementing regulations published by the U.S.
Department of Education, with interest rates and fees no greater than those of
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