[Federal Register Volume 69, Number 130 (Thursday, July 8, 2004)]
[Rules and Regulations]
[Pages 41181-41189]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-15526]


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DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Part 25

[Docket No. 04-17]
RIN 1557-AC86

FEDERAL RESERVE SYSTEM

12 CFR Part 228

[Regulation BB; Docket No. R-1205]

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 345

RIN 3064-AC82

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

12 CFR Part 563e

[No. 2004-28]
RIN 1550-AB91


Community Reinvestment Act Regulations

AGENCIES: Office of the Comptroller of the Currency, Treasury (OCC); 
Board of Governors of the Federal Reserve System (Board); Federal 
Deposit Insurance Corporation (FDIC); Office of Thrift Supervision, 
Treasury (OTS).

ACTION: Joint interim rule with request for comment.

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SUMMARY: The OCC, Board, FDIC and OTS (collectively, ``we'' or ``the

[[Page 41182]]

agencies'') are publishing this joint interim rule with request for 
comment to conform our regulations implementing the Community 
Reinvestment Act (CRA) to changes in: the Standards for Defining 
Metropolitan and Micropolitan Statistical Areas published by the U.S. 
Office of Management and Budget (OMB) in December 2000; census tracts 
designated by the U.S. Bureau of the Census (Census); and the Board's 
Regulation C, which implements the Home Mortgage Disclosure Act (HMDA). 
We are also making a technical correction to a cross-reference within 
our CRA regulations.
    This joint interim rule does not make substantive changes in the 
requirements of the CRA regulations. We are publishing this document as 
a joint interim rule because the changes made by OMB, Census, and the 
Board have already become effective. Further, financial institutions 
must use OMB's statistical area standards, Census' geographies, and the 
Board's Regulation C, when adjusting assessment area delineations and 
collecting CRA loan data, beginning January 1, 2004.

DATES: This joint interim rule is effective on July 8, 2004. Comments 
are due by September 7, 2004.

ADDRESSES: OCC: Comments: Your comment must designate ``OCC'' and 
include Docket Number 04-17 or Regulatory Information Number (RIN) 
1557-AC86. In general, the OCC will enter all comments received into 
the docket without change, including any business or personal 
information that you provide. Because paper mail in the Washington area 
and at the OCC may be subject to delays, please submit your comment by 
e-mail or fax whenever possible. However, you may submit your comment 
by any of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
    OCC Web site: http://www.occ.treas.gov. Click on ``Contact the 
OCC.'' Next, scroll down and click on ``Comments on Proposed 
Regulations.''
    E-mail Address: [email protected].
    Fax: (202) 874-4448.
    Mail: Office of the Comptroller of the Currency, 250 E Street, SW., 
Public Information Room, Mailstop 1-5, Washington, DC 20219.
    Hand Delivery/Courier: 250 E Street, SW., Attn: Public Information 
Room, Mail Stop 1-5, Washington, DC 20219.
    Docket Information: For access to the docket to read comments 
received or background documents you may:
    View Docket Information in Person: You may personally inspect and 
photocopy docket information at the OCC's Public Information Room, 250 
E Street, SW., Washington, DC. You can make an appointment to inspect 
the docket by calling us at (202) 874-5043.
    View docket information electronically: You may request that we 
send you an electronic copy of docket information via e-mail or CD-ROM 
by contacting [email protected].
    Request copies: You may request that we send you a paper copy of 
docket information by faxing us at (202) 874-4448, by calling us at 
(202) 874-5043, or by mailing the OCC at 250 E Street, SW., Attn: 
Public Information Room, Mail Stop 1-5, Washington, DC 20219.
    Board: You may submit comments, identified by Docket No. R-1205, by 
any of the following methods:
    Agency Web Site: http://www.federalreserve.gov. Follow the 
instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
    E-mail: [email protected]. Include docket number in 
the subject line of the message.
    Fax: 202/452-3819 or 202/452-3102.
    Mail: Jennifer J. Johnson, Secretary, Board of Governors of the 
Federal Reserve System, 20th Street and Constitution Avenue, NW., 
Washington, DC 20551.
    All public comments are available from the Board's Web site at 
www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as submitted, 
except as necessary for technical reasons. Accordingly, your comments 
will not be edited to remove any identifying or contact information. 
Public comments may also be viewed electronically or in paper in Room 
MP-500 of the Board's Martin Building (20th and C Streets, NW.) between 
9 a.m. and 5 p.m. on weekdays.
    FDIC: Mail: Written comments should be addressed to Robert E. 
Feldman, Executive Secretary, Attention: Comments, Federal Deposit 
Insurance Corporation, 550 17th Street, NW., Washington, DC 20429.
    Delivery: Comments may be hand delivered to the guard station at 
the rear of the 550 17th Street Building (located on F Street) on 
business days between 7 a.m. and 5 p.m.
    Agency Web site: http://www.fdic.gov/regulations/laws/federal/propose.html. Follow instructions for submitting comment on the agency 
Web site.
    E-mail: You may also electronically mail comments to 
[email protected].
    Public Inspection: Comments may be inspected and photocopied in the 
FDIC Public Information Center, Room 100, 801 17th Street, NW., 
Washington, DC 20429, between 9 a.m. and 4:30 p.m. on business days.
    OTS: You may submit comments, identified by No. 2004-28, by any of 
the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov. Follow the 
instructions for submitting comments.
    E-mail: [email protected]. Please include No. 2004-28 in 
the subject line of the message and include your name and telephone 
number in the message.
    Fax: (202) 906-6518.
    Mail: Regulation Comments, Chief Counsel's Office, Office of Thrift 
Supervision, 1700 G Street, NW., Washington, DC 20552, Attention: No. 
2004-28.
    Hand Delivery/Courier: Guard's Desk, East Lobby Entrance, 1700 G 
Street, NW., from 9 a.m. to 4 p.m. on business days, Attention: 
Regulation Comments, Chief Counsel's Office, Attention: No. 2004-28.
    Instructions: All submissions received must include the agency name 
and number or Regulatory Information Number (RIN) for this rulemaking. 
All comments received will be posted without change to http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1, including any 
personal information provided.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.ots.treas.gov/pagehtml.cfm?catNumber=67&an=1. In addition, you may inspect comments 
at the Public Reading Room, 1700 G Street, NW., by appointment. To make 
an appointment for access, call (202) 906-5922, send an e-mail to 
public.info@ots.treas.gov">public.info@ots.treas.gov, or send a facsimile transmission to (202) 
906-7755. (Prior notice identifying the materials you will be 
requesting will assist us in serving you.) We schedule appointments on 
business days between 10 a.m. and 4 p.m. In most cases, appointments 
will be available the next business day following the date we receive a 
request.

FOR FURTHER INFORMATION CONTACT: OCC: Karen Tucker, National Bank 
Examiner, Compliance Division, (202) 874-4428; or Margaret Hesse, 
Special Counsel, Community and Consumer

[[Page 41183]]

Law Division, (202) 874-5750, Office of the Comptroller of the 
Currency, 250 E Street, SW., Washington, DC 20219.
    Board: William T. Coffey, Senior Review Examiner, (202) 452-3946; 
Catherine M.J. Gates, Oversight Team Leader, (202) 452-3946; Kathleen 
C. Ryan, Counsel, (202) 452-3667; or Dan S. Sokolov, Senior Attorney, 
(202) 452-2412, Division of Consumer and Community Affairs, Board of 
Governors of the Federal Reserve System, 20th Street and Constitution 
Avenue, NW., Washington, DC 20551.
    FDIC: Pamela Freeman, Policy Analyst, (202) 898-6568, Division of 
Supervision and Consumer Protection; or Susan van den Toorn, Counsel, 
Legal Division, (202) 898-8707, Federal Deposit Insurance Corporation, 
550 17th Street, NW., Washington, DC 20429.
    OTS: Celeste Anderson, Project Manager, Compliance Policy, (202) 
906-7990; Theresa A. Stark, Program Manager, Compliance Policy, (202) 
906-7054; or Richard Bennett, Counsel (Banking and Finance), 
Regulations and Legislation Division, (202) 906-7409, Office of Thrift 
Supervision, 1700 G Street, NW., Washington, DC 20552.

SUPPLEMENTARY INFORMATION:

Introduction

    The agencies jointly are amending our regulations implementing the 
CRA (12 U.S.C. 2901 et seq.). This joint interim rule conforms the 
agencies' CRA regulations to recent actions of OMB, Census, and the 
Board. (This joint interim rulemaking is unrelated to the agencies' 
comprehensive review of the CRA regulations and the proposed revisions 
to the regulations that were published for comment on February 6, 2004, 
at 69 FR 5729.)

Changes Resulting From OMB Revisions

    The OMB's standards for defining statistical areas provide 
nationally consistent definitions for government agencies to use when 
collecting, tabulating, and publishing Federal statistics by geographic 
area. OMB updates the standards approximately every 10 years.
    The agencies' CRA regulations use OMB's standards for defining 
metropolitan areas for purposes of CRA data collection and reporting, 
and for delineating institutions' assessment area(s). Under OMB's 1990 
standards, metropolitan areas consisted of: (1) Metropolitan 
statistical areas (MSAs) and (2) larger consolidated metropolitan 
statistical areas (CMSAs). CMSAs consisted, in turn, of primary 
metropolitan statistical areas (PMSAs).
    On December 27, 2000, OMB published in the Federal Register a 
notice adopting new Standards for Defining Metropolitan and 
Micropolitan Statistical Areas. 65 FR 82228 (Dec. 27, 2000). These new 
standards replaced and superseded OMB's 1990 standards for defining 
metropolitan areas. The 2000 standards retain the basic concept of an 
MSA (an area with at least 50,000 population) and continue to recognize 
that in large MSAs, demographic and economic conditions vary widely. 
According to OMB, those variations necessitate dividing large MSAs into 
``metropolitan divisions,'' smaller statistical areas similar to 
PMSAs.\1\ Metropolitan divisions are only in MSAs that have a single 
core with a population of at least 2.5 million.
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    \1\ ``The provision of data for only the entire metropolitan 
area based on such large urbanized areas may mask demographic and 
economic variations that are important for data users and 
analysts.'' Final Report and Recommendations from the Metropolitan 
Areas Standards Review Committee to OMB Concerning Changes to the 
Standards for Defining Metropolitan Areas, 65 FR 51060, 51067 (Aug. 
22, 2000).
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    More than two years later, in June 2003, OMB announced the specific 
boundaries of the new MSAs, metropolitan divisions, and other 
statistical areas based on data from the 2000 Census. OMB Bulletin No. 
03-04 (June 6, 2003), available at http://www.whitehouse.gov/omb/bulletins/b03-04.html. OMB updated the list of MSAs and other 
statistical areas effective December 2003, in a bulletin issued in 
February 2004. OMB Bulletin No. 04-03 (February 18, 2004) available at 
http://www.whitehouse.gov/omb/bulletins/b0-03.html. In these bulletins, 
OMB directed all agencies that conduct statistical activities to 
collect and publish data for MSAs using the most recent definition of 
the area. To that end, the agencies have made a number of changes to 
the CRA regulations, which until now have conformed to OMB's 1990 
statistical area standards, to incorporate OMB's new standards and 
definitions.
    First, we removed the definition of ``CMSA'' and all references to 
CMSAs in our regulations because OMB no longer uses that term. We 
replaced ``CMSA'' with ``MSA.''
    Second, we revised the definition of ``MSA'' (Sec. Sec.  25.12(r), 
228.12(r), 345.12(r), and 563e.12(q)) to remove the reference to PMSA, 
another term that OMB no longer uses. The revised definition of ``MSA'' 
refers only to metropolitan statistical areas, as defined by OMB.
    Third, we added a definition of ``metropolitan division'' (new 
Sec. Sec.  25.12(q), 228.12(q), 345.12(q), and 563e.12(p)). In certain 
MSAs, OMB has delineated ``metropolitan divisions'' which are the 
statistical areas for which CRA data are to be reported, median family 
income is to be calculated, and within which an institution's CRA 
performance is to be evaluated. These uses of the metropolitan 
divisions are consistent with the use of OMB's 1990 standards in our 
CRA regulations in effect prior to this joint interim rule: 
Institutions reported the location of loans by PMSA if the loan was 
located in a CMSA; the agencies evaluated the institution's performance 
at the PMSA level; and the agencies calculated median family income by 
PMSA, not by CMSA. Focusing on performance at the metropolitan division 
level also is consistent with OMB's recent direction to Federal 
agencies to provide detailed data for each metropolitan division, in 
explanation of which OMB noted that ``[a] Metropolitan Division is most 
generally comparable in concept, and equivalent to, the now obsolete 
Primary Metropolitan Statistical Area.'' OMB Bulletin 04-03.
    The agencies are aware that in some MSAs, OMB's new designations of 
metropolitan divisions will result in the income level of census tracts 
changing without any actual change in the economic conditions of the 
area. Based on estimated data, the agencies believe that in most MSAs, 
any such changes will be de minimus. For example, many MSAs show 
negligible change in the median family income levels of census tracts. 
On the other hand, in the Detroit-Warren-Livonia MSA, changes in census 
tract income level may be significant; the application of OMB's 2000 
standards resulted in two metropolitan divisions, one consisting of 
Wayne county, which includes the inner city, and one consisting of the 
suburban counties that surround Wayne county. A number of geographies 
in the suburban metropolitan division that previously were classified 
as middle-income are now moderate-income, while in the urban 
metropolitan division (Wayne county), a similar number of moderate-
income geographies are now middle-income. Examiners will consider these 
differences and the effect they may have on an institution's CRA 
performance as part of the performance context applicable to the 
institution's CRA examination and in connection with the institution's 
delineation of assessment area(s).
    Fourth, we changed our regulations (Sec. Sec.  25.41, 228.41, 
345.41, and 563e.41) to allow an institution to designate an assessment 
area that includes one or more metropolitan divisions, just as an 
institution until now could designate an

[[Page 41184]]

assessment area that includes one or more PMSAs. Under this joint 
interim rule, an institution may designate one or more metropolitan 
divisions, up to an entire MSA, as an assessment area.
    Although the agencies' regulations prior to publication of this 
joint interim rule allowed an institution to delineate an entire CMSA 
as an assessment area, examiners have evaluated CRA performance at the 
PMSA level, using PMSA income data. Under this joint interim rule, 
examiners will evaluate CRA performance at the metropolitan division 
level, even if the institution delineates an assessment area of more 
than one metropolitan division or an entire MSA.
    Fifth, prior to this joint interim rule, Sec. Sec.  25.41(e)(4), 
228.41(e)(4), 345.41(e)(4), and 563e.41(e)(4) stated that an assessment 
area ``may not extend substantially beyond a CMSA boundary * * *.'' We 
have changed these provisions to replace ``CMSA'' with ``MSA.'' These 
changes conform the terminology in this section to the new OMB area 
standards. The regulations still allow an institution to delineate an 
assessment area consisting of more than one MSA. See Sec. Sec.  
21.41(c)(1), 228.41(c)(1), 345.41(c)(1), and 563e.41(c)(1). The border 
of such an assessment area, however, may not extend substantially 
beyond the boundaries of the MSAs in the assessment area.
    Sixth, we added a new definition of ``nonmetropolitan area,'' which 
is any area that is not included in an MSA (new Sec. Sec.  25.12(s), 
228.12(s), 345.12(s), and 563e.12(r)). This definition will encompass 
areas covered by the new OMB term ``micropolitan statistical area.'' 
Because micropolitan statistical areas are not located in MSAs, they 
are part of the nonmetropolitan area of a state. In a related matter, 
the agency-prepared annual aggregate disclosure statements will 
continue to include a statement for the non-MSA portion of every state, 
which will include all micropolitan statistical areas in the state. We 
changed the reference to ``non-MSA portion of each state'' in 
Sec. Sec.  25.42(i), 228.42(i), 345.42(i), and 563e.42(i) to 
``nonmetropolitan portion of each state'' to ensure clarity.

Changes Resulting From Census Revisions

    Prior to this joint interim rule, the CRA regulations (former 
Sec. Sec.  25.12(l), 228.12(l), 345.12(l), and 563e.12(k)) defined the 
term ``geography'' as ``a census tract or a block numbering area 
delineated by the United States Bureau of the Census in the most recent 
decennial census.'' Prior to Census 2000, a ``block numbering area'' 
was a statistical subdivision created for grouping and numbering blocks 
within a county for which census tracts had not been established. 
Beginning with Census 2000, the Bureau of Census assigned census tracts 
in all counties, making block numbering areas unnecessary. See, e.g., 
U.S. Census Bureau, Geographic Terms and Concepts (definition of 
``census tract'') available at http://www.census.gov/geo/www/tiger/glossry2.html#CensusTract. As a result, we changed our definition of 
``geography'' to omit the term ``block numbering area'' (Sec. Sec.  
25.12(k), 228.12(k), 345.12(k), and 563e.12(j)).
    The definition of ``geography'' affects assessment area delineation 
and data collection and reporting. First, when delineating an 
assessment area, a financial institution must include only whole 
geographies. Second, data about small business, small farm, community 
development, and consumer loans include loan location, which is the 
geography (census tract) in which the loan or borrower is located.

Changes Resulting From Revisions to the Board's Regulation C

    Prior to this joint interim rule, the CRA regulations defined a 
``home mortgage loan'' to mean a ``home improvement loan'' or a ``home 
purchase loan'' as defined in 12 CFR 203.2. The interagency CRA 
guidance that we published clarified that this definition of ``home 
mortgage loan'' also includes refinancings of home improvement and home 
purchase loans. See 66 FR 36620, 36628 (July 12, 2001) (question 1 
addressing Sec. Sec.  ----.12(m) & 563e.12(l)).
    The Board substantially revised Regulation C (12 CFR 203) in 2002, 
effective January 1, 2004. 67 FR 7222 (Feb. 15, 2002). Before these 
revisions, a lender could choose among four standards to determine 
which refinancings to report; two of the standards considered the 
purpose of the loan being refinanced. The revised Regulation C replaced 
this approach with a definition of ``refinancing'' that applies 
uniformly, namely, a loan is reportable as a refinancing if an 
obligation satisfies and replaces another obligation, and both the 
existing obligation and the new obligation are secured by a lien on a 
dwelling. 12 CFR 203.2(k). Under this definition, the purpose of the 
loan being refinanced is not considered. Furthermore, if the obligation 
meets the definition of a ``refinancing'' under the revised Regulation 
C, then it is reportable even if it is not a ``refinancing'' under 
Regulation Z requiring new disclosures. See 12 CFR 226.20(a). As a 
result of the revisions to Regulation C, we changed the definition of 
``home mortgage loan'' in the CRA regulations to include refinancings, 
as well as home purchase loans and home improvement loans, as defined 
in 12 CFR 203.2.
    In some cases, the new definition of ``home mortgage loan'' could 
lead to ``double counting'' of certain loans because refinancings 
reported under HMDA and evaluated under CRA may also be reported as 
refinancings of small business or small farm loans under CRA. The 
definition of ``small business loan'' under the CRA regulations 
incorporates the Consolidated Report of Condition and Income (Call 
Report) or Thrift Financial Report (TFR) definition of ``loans to small 
businesses.'' See Sec. Sec.  25.12(u), 228.12(u), 345.12(u), and 
563e.12(t). The Call Report and TFR instructions exclude from this 
category loans secured by residential real estate. See Schedule RC-C, 
part II, Loans to Small Businesses and Small Farms; Schedule RC-C, part 
I, item 1.e.; Schedule RC-C, part I, item 4 (list of exclusions); see 
also TFR Schedule SB. However, a loan secured by real estate 
nonetheless is considered not secured by real estate for purposes of 
the Call Report instructions if the security interest is taken ``solely 
through an abundance of caution and where the terms as a consequence 
have not been made more favorable than they would have been in the 
absence of the lien.'' See Call Report Glossary definition of ``Loan 
Secured by Real Estate.'' Thrifts, on the other hand, have the option 
of reporting such loans as small business loans or home mortgage loans. 
See TFR Instructions and Schedule SB.
    Under this standard, a financial institution could report a loan 
secured by a dwelling as a small business loan. If such a loan were to 
a small business, as ``loan to small business'' is defined in the Call 
Report and TFR instructions, the institution would report the loan, for 
CRA purposes, as a small business loan. A refinancing of such a loan, 
moreover, would be reported for CRA purposes as a refinancing of a 
small business loan. If the refinancing is secured by a dwelling and it 
satisfies or replaces another loan that was secured by a dwelling, the 
refinancing would also be reported as a refinancing of a mortgage loan 
under HMDA and, therefore, also considered as a ``home mortgage loan'' 
in the institution's CRA evaluation.
    Similarly, some refinancings of small farm loans that are reported 
as small farm loans on Schedule RC-C, part II of the Call Report and 
TFR Schedule SB and, thus, are included as small farm loans for CRA 
data reporting purposes,

[[Page 41185]]

are also reported as refinancings under HMDA and captured as home 
mortgage loans for CRA evaluation purposes. Schedule RC-C, part II and 
TFR Schedule SB require reporting of ``loans secured by farmland 
(including farm residential and other improvements)'' and ``loans to 
finance agricultural production and other loans to farms'' that have 
original amounts of $500,000 or less. Loans in either category could be 
secured by a dwelling, either primarily as part of the farmland, in the 
first category, or through an abundance of caution, in the second 
category. Institutions would report refinancings of such loans on the 
Call Report and the TFR as loans to small farms and also under HMDA as 
refinancings.
    We do not anticipate that loans counted as both ``small business/
small farm loans'' and ``home mortgage loans'' will be so numerous as 
to affect the typical institution's CRA rating. In the event that an 
institution reports a significant number or amount of loans as both 
home mortgage and small business or farm loans, examiners will consider 
that overlap in evaluating the institution's performance.

Technical Correction

    We also have corrected an error in the cross-reference found in 
Sec. Sec.  25.27(g)(1), 228.27(g)(1), 345.27(g)(1), and 563e.27(g)(1). 
Those provisions, which address the time for an agency's decision 
following receipt of a completed strategic plan, previously referred 
the reader to paragraph (d) of Sec. Sec.  25.27, 228.27, 345.27, or 
563e.27, respectively, for a description of the materials that had to 
be included with a strategic plan submission. This information is found 
instead in paragraph (e) of Sec. Sec.  25.27, 228.27, 345.27, or 
563e.27. Therefore, we corrected the cross-references in Sec. Sec.  
25.27(g)(1), 228.27(g)(1), 345.27(g)(1), and 563e.27(g)(1) to refer to 
paragraph (e) of Sec. Sec.  25.27, 228.27, 345.27, and 563e.27, 
respectively.

Timing and Comments

    This joint interim rule is effective immediately. Institutions must 
be aware of these changes when designating their assessment areas and 
collecting CRA performance data for calendar year 2004, which must be 
reported by March 1, 2005. Financial institutions and others who wish 
to express their views about the appropriateness of these changes are 
encouraged to send comments to the agencies. We will consider the 
comments and, if appropriate, address them when we adopt this joint 
interim rule as a final rule.

Effective Date

    The Administrative Procedure Act provides that, subject to several 
exceptions, a substantive rule may not be made effective until 30 days 
after publication in the Federal Register. 5 U.S.C. 553(d). However, an 
agency may make a rule immediately effective upon publication if the 
agency finds good cause for doing so and publishes its findings with 
the rule. Likewise, section 302 of the Riegle Community Development and 
Regulatory Improvement Act of 1994 (CDRI), Pub. L. 103-325, authorizes 
a banking agency to issue a rule to be effective before the first day 
of the calendar quarter that begins on or after the date on which the 
regulations are published in final form if the agency finds good cause 
for an earlier effective date. 12 U.S.C. 4802(b)(1).
    This joint interim rule takes effect immediately. The agencies find 
good cause to dispense with the 30-day delayed effective date pursuant 
to 5 U.S.C. 553(d)(3). The agencies also have determined that good 
cause exists to adopt an effective date that is before the first day of 
the calendar quarter that begins on or after the date on which the 
regulation is published, as would otherwise be required by section 102 
of the CDRI (12 U.S.C. 4802(b)(1)). As discussed more fully earlier in 
this preamble, the changes adopted in this joint interim rule merely 
conform our CRA regulations to recent changes by OMB, Census, and the 
Board. These changes are not substantive; the technical correction 
merely corrects a cross-reference. Financial institutions must use the 
new statistical area standards and definitions when adjusting 
assessment area delineations and collecting loan data during calendar 
year 2004 (beginning with loans made as of January 1, 2004) for 
reporting by March 1, 2005. Therefore, this joint interim rule must 
take effect immediately upon publication in the Federal Register in 
order to eliminate potential confusion for financial institutions 
attempting to comply with their 2004 data collection requirements. For 
the foregoing reasons, the agencies have determined that it is 
unnecessary and contrary to public interest to delay the effective date 
of this joint interim rule.

Regulatory Analysis

Paperwork Reduction Act

    There are no collection of information requirements in this joint 
interim rule.

Regulatory Flexibility Act

    Pursuant to section 605(b) of the Regulatory Flexibility Act (5 
U.S.C. 605(b)), the OCC, Board, FDIC, and OTS hereby certify that this 
joint interim rule will not have a significant economic impact on a 
substantial number of small entities. The agencies expect that this 
joint interim rule will not have significant secondary or incidental 
effects on a substantial number of small entities, or create any 
additional burden on small entities. This joint interim rule merely 
makes a technical correction and conforms terminology in the current 
CRA regulations with terms and definitions already adopted by OMB, 
Census, and the Board. Accordingly, a regulatory flexibility analysis 
is not required.

OCC and OTS Executive Order 12866 Determination

    The OCC and the OTS have determined that this joint interim rule is 
not a significant regulatory action as defined in Executive Order 
12866.

OCC and OTS Unfunded Mandates Reform Act of 1995 Determination

    Section 202 of the Unfunded Mandates Reform Act of 1995 (Unfunded 
Mandates Act) (2 U.S.C. 1532) requires that covered agencies prepare a 
budgetary impact statement before promulgating a rule that includes any 
Federal mandate that may result in the expenditure by State, local, and 
tribal governments, in the aggregate, or by the private sector, of $100 
million or more in any one year. If a budgetary impact statement is 
required, section 205 of the Unfunded Mandates Act also requires 
covered agencies to identify and consider a reasonable number of 
regulatory alternatives before promulgating a rule. The OCC and the OTS 
have determined that this joint interim rule will not result in 
expenditures by State, local, and tribal governments, or by the private 
sector, of $100 million or more in any one year. Accordingly, neither 
agency has prepared a budgetary impact statement or specifically 
addressed the regulatory alternatives considered.

The Treasury and General Government Appropriations Act, 1999--
Assessment of Impact of Federal Regulation on Families

    The FDIC has determined that this joint interim rule will not 
affect family well-being within the meaning of section 654 of the 
Treasury and General Government Appropriations Act, enacted as part of 
the Omnibus Consolidated and Emergency Supplemental Appropriations Act 
of

[[Page 41186]]

1999, Pub. L. 105-277 (5 U.S.C. 601 note).

Solicitation of Comments Regarding the Use of ``Plain Language''

    Section 722 of the Gramm-Leach-Bliley Act of 1999, 12 U.S.C. 4809, 
requires the agencies to use ``plain language'' in all proposed and 
final rules published after January 1, 2000. We invite comments on 
whether this joint interim rule is stated clearly and effectively 
organized, and how we might make the regulatory text easier to read.

OCC Executive Order 13132 Determination

    The OCC has determined that this joint interim rule does not have 
any Federalism implications, as required by Executive Order 13132.

List of Subjects

12 CFR Part 25

    Community development, Credit, Investments, National banks, 
Reporting and recordkeeping requirements.

12 CFR Part 228

    Banks, Banking, Community development, Credit, Investments, 
Reporting and recordkeeping requirements.

12 CFR Part 345

    Banks, Banking, Community development, Credit Investments, 
Reporting and recordkeeping requirements.

12 CFR Part 563e

    Community development, Credit, Investments, Reporting and 
recordkeeping requirements, Savings associations.

DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Chapter I

Authority and Issuance

0
For the reasons discussed in the joint preamble, part 25 of chapter I 
of title 12 of the Code of Federal Regulations is amended as follows:

PART 25--COMMUNITY REINVESTMENT ACT AND INTERSTATE DEPOSIT 
PRODUCTION REGULATIONS

0
1. The authority citation for part 25 continues to read as follows:

    Authority: 12 U.S.C. 21, 22, 26, 27, 30, 36, 93a, 161, 215, 
215a, 481, 1814, 1816, 1828(c), 1835a, 2901 through 2907, and 3101 
through 3111.


0
2. In Sec.  25.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (g);
0
c. Redesignate paragraphs (h), (i), (j), (k), (l), and (m) as 
paragraphs (g), (h), (i), (j), (k), and (l);
0
d. Revise newly redesignated paragraphs (k) and (l);
0
e. Redesignate paragraphs (n), (o), (p), and (q) as paragraphs (m), 
(n), (o), and (p);
0
f. Add a new paragraph (q);
0
g. Revise paragraph (r);
0
h. Redesignate paragraphs (s), (t), (u), (v), and (w) as (t), (u), (v), 
(w), and (x); and
0
i. Add a new paragraph (s) to read as follows:


Sec.  25.12  Definitions.

* * * * *
    (b) Area median income means:
    (1) The median family income for the MSA, if a person or geography 
is located in an MSA, or for the metropolitan division, if a person or 
geography is located in an MSA that has been subdivided into 
metropolitan divisions; or
* * * * *
    (k) Geography means a census tract delineated by the United States 
Bureau of the Census in the most recent decennial census.
    (l) Home mortgage loan means a ``home improvement loan,'' ``home 
purchase loan,'' or a ``refinancing'' as defined in Sec.  203.2 of this 
title.
* * * * *
    (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.
* * * * *
0
3.Amend Sec.  25.27(g)(1) by removing the term ``paragraph (d)'' and 
adding in its place the term ``paragraph (e)''.

0
4. In Sec.  25.41, revise paragraphs (b), (c)(1) and (e)(4) to read as 
follows:


Sec.  25.41  Assessment area delineation.

* * * * *
    (b) Geographic area(s) for wholesale or limited purpose banks. The 
assessment area(s) for a wholesale or limited purpose bank must consist 
generally of one or more MSAs or metropolitan divisions (using the MSA 
or metropolitan division boundaries that were in effect as of January 1 
of the calendar year in which the delineation is made) or one or more 
contiguous political subdivisions, such as counties, cities, or towns, 
in which the bank has its main office, branches, and deposit-taking 
ATMs.
    (c) * * *
    (1) Consist generally of one or more MSAs or metropolitan divisions 
(using the MSA or metropolitan division boundaries that were in effect 
as of January 1 of the calendar year in which the delineation is made) 
or one or more contiguous political subdivisions, such as counties, 
cities, or towns; and
* * * * *
    (e) * * *
* * * * *
    (4) May not extend substantially beyond an MSA boundary or beyond a 
state boundary unless the assessment area is located in a multistate 
MSA. If a bank serves a geographic area that extends substantially 
beyond a state boundary, the bank shall delineate separate assessment 
areas for the areas in each state. If a bank serves a geographic area 
that extends substantially beyond an MSA boundary, the bank shall 
delineate separate assessment areas for the areas inside and outside 
the MSA.
* * * * *

0
5. In Sec.  25.42, revise paragraph (i) to read as follows:


Sec.  25.42  Data collection, reporting, and disclosure.

* * * * *
    (i) Aggregate disclosure statements. The OCC, in conjunction with 
the Board of Governors of the Federal Reserve System, the Federal 
Deposit Insurance Corporation, and the Office of Thrift Supervision, 
prepares annually, for each MSA or metropolitan division (including an 
MSA or metropolitan division that crosses a state boundary) and the 
nonmetropolitan portion of each state, an aggregate disclosure 
statement of small business and small farm lending by all institutions 
subject to reporting under this part or parts 228, 345, or 563e of this 
title. These disclosure statements indicate, for each geography, the 
number and amount of all small business and small farm loans originated 
or purchased by reporting institutions, except that the OCC may adjust 
the form of the disclosure if necessary, because of special 
circumstances, to protect the privacy of a borrower or the competitive 
position of an institution.
* * * * *

[[Page 41187]]

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM

12 CFR Chapter II

Authority and Issuance

0
For the reasons discussed in the joint preamble, part 228 of chapter II 
of title 12 of the Code of Federal Regulations is amended as follows:

PART 228--COMMUNITY REINVESTMENT (REGULATION BB)

0
1. The authority citation for part 228 continues to read as follows:

    Authority: 12 U.S.C. 321, 325, 1828(c), 1842, 1843, 1844, and 
2901 et seq.


0
2. In Sec.  228.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (g);
0
c. Redesignate paragraphs (h), (i), (j), (k), (l), and (m) as 
paragraphs (g), (h), (i), (j), (k), and (l);
0
d. Revise newly redesignated paragraphs (k) and (l);
0
e. Redesignate paragraphs (n), (o), (p), and (q) as paragraphs (m), 
(n), (o), and (p);
0
f. Add a new paragraph (q);
0
g. Revise paragraph (r);
0
h. Redesignate paragraphs (s), (t), (u), (v), and (w) as (t), (u), (v), 
(w), and (x); and
0
i. Add a new paragraph (s) to read as follows:


Sec.  228.12  Definitions.

* * * * *
    (b) Area median income means:
    (1) The median family income for the MSA, if a person or geography 
is located in an MSA, or for the metropolitan division, if a person or 
geography is located in an MSA that has been subdivided into 
metropolitan divisions; or
* * * * *
    (k) Geography means a census tract delineated by the United States 
Bureau of the Census in the most recent decennial census.
    (l) Home mortgage loan means a ``home improvement loan,'' ``home 
purchase loan,'' or a ``refinancing'' as defined in Sec.  203.2 of this 
title.
* * * * *
    (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.
* * * * *

0
3. Amend Sec.  228.27(g)(1) by removing the term ``paragraph (d)'' and 
adding in its place the term ``paragraph (e)''.
0
4. In Sec.  228.41, revise paragraphs (b), (c)(1) and (e)(4) to read as 
follows:


Sec.  228.41  Assessment area delineation.

* * * * *
    (b) Geographic area(s) for wholesale or limited purpose banks. The 
assessment area(s) for a wholesale or limited purpose bank must consist 
generally of one or more MSAs or metropolitan divisions (using the MSA 
or metropolitan division boundaries that were in effect as of January 1 
of the calendar year in which the delineation is made) or one or more 
contiguous political subdivisions, such as counties, cities, or towns, 
in which the bank has its main office, branches, and deposit-taking 
ATMs.
    (c) * * *
    (1) Consist generally of one or more MSAs or metropolitan divisions 
(using the MSA or metropolitan division boundaries that were in effect 
as of January 1 of the calendar year in which the delineation is made) 
or one or more contiguous political subdivisions, such as counties, 
cities, or towns; and
* * * * *
    (e) * * *
* * * * *
    (4) May not extend substantially beyond an MSA boundary or beyond a 
state boundary unless the assessment area is located in a multistate 
MSA. If a bank serves a geographic area that extends substantially 
beyond a state boundary, the bank shall delineate separate assessment 
areas for the areas in each state. If a bank serves a geographic area 
that extends substantially beyond an MSA boundary, the bank shall 
delineate separate assessment areas for the areas inside and outside 
the MSA.
* * * * *

0
5. In Sec.  228.42, revise paragraph (i) to read as follows:


Sec.  228.42  Data collection, reporting, and disclosure.

* * * * *
    (i) Aggregate disclosure statements. The Board, in conjunction with 
the Office of the Comptroller of the Currency, the Federal Deposit 
Insurance Corporation, and the Office of Thrift Supervision, prepares 
annually, for each MSA or metropolitan division (including an MSA or 
metropolitan division that crosses a state boundary) and the 
nonmetropolitan portion of each state, an aggregate disclosure 
statement of small business and small farm lending by all institutions 
subject to reporting under this part or parts 25, 345, or 563e of this 
title. These disclosure statements indicate, for each geography, the 
number and amount of all small business and small farm loans originated 
or purchased by reporting institutions, except that the Board may 
adjust the form of the disclosure if necessary, because of special 
circumstances, to protect the privacy of a borrower or the competitive 
position of an institution.
* * * * *

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Chapter III

Authority and Issuance

0
For the reasons discussed in the joint preamble, the Board of Directors 
of the FDIC amends part 345 of chapter III of title 12 of the Code of 
Federal Regulations to read as follows:

PART 345--COMMUNITY REINVESTMENT

0
1. The authority citation for part 345 continues to read as follows:

    Authority: 12 U.S.C. 1814-1817, 1819-1820, 1828, 1831u and 2901-
2907, 3103-3104, and 3108(a).


0
2. In Sec.  345.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (g);
0
c. Redesignate paragraphs (h), (i), (j), (k), (l), and (m) as 
paragraphs (g), (h), (i), (j), (k), and (l);
0
d. Revise newly redesignated paragraphs (k) and (l);
0
e. Redesignate paragraphs (n), (o), (p), and (q) as paragraphs (m), 
(n), (o), and (p);
0
f. Add a new paragraph (q);
0
g. Revise paragraph (r);
0
h. Redesignate paragraphs (s), (t), (u), (v), and (w) as (t), (u), (v), 
(w), and (x); and
0
i. Add a new paragraph (s) to read as follows:


Sec.  345.12  Definitions.

* * * * *
    (b) Area median income means:
    (1) The median family income for the MSA, if a person or geography 
is located in an MSA, or for the metropolitan division, if a person or 
geography is located in an MSA that has been subdivided into 
metropolitan divisions; or
* * * * *
    (k) Geography means a census tract delineated by the United States 
Bureau of the Census in the most recent decennial census.
    (l) Home mortgage loan means a ``home improvement loan,'' ``home

[[Page 41188]]

purchase loan,'' or a ``refinancing'' as defined in Sec.  203.2 of this 
title.
* * * * *
    (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.
* * * * *

0
3. Amend Sec.  345.27(g)(1) by removing the term ``paragraph (d)'' and 
adding in its place the term ``paragraph (e)''.

0
4. In Sec.  345.41, revise paragraphs (b), (c)(1) and (e)(4) to read as 
follows:


Sec.  345.41  Assessment area delineation.

* * * * *
    (b) Geographic area(s) for wholesale or limited purpose banks. The 
assessment area(s) for a wholesale or limited purpose bank must consist 
generally of one or more MSAs or metropolitan divisions (using the MSA 
or metropolitan division boundaries that were in effect as of January 1 
of the calendar year in which the delineation is made) or one or more 
contiguous political subdivisions, such as counties, cities, or towns, 
in which the bank has its main office, branches, and deposit-taking 
ATMs.
    (c) * * *
    (1) Consist generally of one or more MSAs or metropolitan divisions 
(using the MSA or metropolitan division boundaries that were in effect 
as of January 1 of the calendar year in which the delineation is made) 
or one or more contiguous political subdivisions, such as counties, 
cities, or towns; and
* * * * *
    (e) * * *
* * * * *
    (4) May not extend substantially beyond an MSA boundary or beyond a 
state boundary unless the assessment area is located in a multistate 
MSA. If a bank serves a geographic area that extends substantially 
beyond a state boundary, the bank shall delineate separate assessment 
areas for the areas in each state. If a bank serves a geographic area 
that extends substantially beyond an MSA boundary, the bank shall 
delineate separate assessment areas for the areas inside and outside 
the MSA.
* * * * *

0
5. In Sec.  345.42, revise paragraph (i) to read as follows:


Sec.  345.42  Data collection, reporting, and disclosure.

* * * * *
    (i) Aggregate disclosure statements. The FDIC, in conjunction with 
the Board of Governors of the Federal Reserve System, the Office of the 
Comptroller of the Currency, and the Office of Thrift Supervision, 
prepares annually, for each MSA or metropolitan division (including an 
MSA or metropolitan division that crosses a state boundary) and the 
nonmetropolitan portion of each state, an aggregate disclosure 
statement of small business and small farm lending by all institutions 
subject to reporting under this part or parts 25, 228, or 563e of this 
title. These disclosure statements indicate, for each geography, the 
number and amount of all small business and small farm loans originated 
or purchased by reporting institutions, except that the FDIC may adjust 
the form of the disclosure if necessary, because of special 
circumstances, to protect the privacy of a borrower or the competitive 
position of an institution.
* * * * *

DEPARTMENT OF THE TREASURY

Office of Thrift Supervision

12 CFR Chapter V

Authority and Issuance

0
For the reasons discussed in the joint preamble, part 563e of chapter V 
of title 12 of the Code of Federal Regulations is amended as follows:

PART 563e--COMMUNITY REINVESTMENT

0
1. The authority citation for part 563e continues to read as follows:

    Authority: 12 U.S.C. 1462a, 1463, 1464, 1467a, 1814, 1816, 
1828(c), and 2901 through 2907.

0
2. In Sec.  563e.12:
0
a. Revise paragraph (b)(1);
0
b. Remove paragraph (f);
0
c. Redesignate paragraphs (g), (h), (i), (j), (k), and (l) as 
paragraphs (f), (g), (h), (i), (j), and (k);
0
d. Revise newly redesignated paragraphs (j) and (k);
0
e. Redesignate paragraphs (m), (n), (o), and (p) as paragraphs (l), 
(m), (n), and (o);
0
f. Add a new paragraph (p);
0
g. Revise paragraph (q);
0
h. Redesignate paragraphs (r), (s), (t), (u), and (v) as (s), (t), (u), 
(v), and (w); and
0
i. Add a new paragraph (r) to read as follows:


Sec.  563e.12  Definitions.

* * * * *
    (b) Area median income means:
    (1) The median family income for the MSA, if a person or geography 
is located in an MSA, or for the metropolitan division, if a person or 
geography is located in an MSA that has been subdivided into 
metropolitan divisions; or
* * * * *
    (j) Geography means a census tract delineated by the United States 
Bureau of the Census in the most recent decennial census.
    (k) Home mortgage loan means a ``home improvement loan,'' ``home 
purchase loan,'' or a ``refinancing'' as defined in Sec.  203.2 of this 
title.
* * * * *
    (p) Metropolitan division means a metropolitan division as defined 
by the Director of the Office of Management and Budget.
    (q) MSA means a metropolitan statistical area as defined by the 
Director of the Office of Management and Budget.
    (r) Nonmetropolitan area means any area that is not located in an 
MSA.
* * * * *

0
3. Amend Sec.  563e.27(g)(1) by removing the term ``paragraph (d)'' and 
adding in its place the term ``paragraph (e)''.

0
4. In Sec.  563e.41, revise paragraphs (b), (c)(1) and (e)(4) to read 
as follows:


Sec.  563e.41  Assessment area delineation.

* * * * *
    (b) Geographic area(s) for wholesale or limited purpose savings 
associations. The assessment area(s) for a wholesale or limited purpose 
savings association must consist generally of one or more MSAs or 
metropolitan divisions (using the MSA or metropolitan division 
boundaries that were in effect as of January 1 of the calendar year in 
which the delineation is made) or one or more contiguous political 
subdivisions, such as counties, cities, or towns, in which the savings 
association has its main office, branches, and deposit-taking ATMs.
    (c) * * *
    (1) Consist generally of one or more MSAs or metropolitan divisions 
(using the MSA or metropolitan division boundaries that were in effect 
as of January 1 of the calendar year in which the delineation is made) 
or one or more contiguous political subdivisions, such as counties, 
cities, or towns; and
* * * * *
    (e) * * *
* * * * *
    (4) May not extend substantially beyond an MSA boundary or beyond a 
state boundary unless the assessment area is located in a multistate 
MSA. If

[[Page 41189]]

a savings association serves a geographic area that extends 
substantially beyond a state boundary, the savings association shall 
delineate separate assessment areas for the areas in each state. If a 
savings association serves a geographic area that extends substantially 
beyond an MSA boundary, the savings association shall delineate 
separate assessment areas for the areas inside and outside the MSA.
* * * * *

0
5. In Sec.  563e.42, revise paragraph (i) to read as follows:


Sec.  563e.42  Data collection, reporting, and disclosure.

* * * * *
    (i) Aggregate disclosure statements. The OTS, in conjunction with 
the Board of Governors of the Federal Reserve System, the Federal 
Deposit Insurance Corporation, and the Office of the Comptroller of the 
Currency, prepares annually, for each MSA or metropolitan division 
(including an MSA or metropolitan division that crosses a state 
boundary) and the nonmetropolitan portion of each state, an aggregate 
disclosure statement of small business and small farm lending by all 
institutions subject to reporting under this part or parts 25, 228, or 
345 of this title. These disclosure statements indicate, for each 
geography, the number and amount of all small business and small farm 
loans originated or purchased by reporting institutions, except that 
the OTS may adjust the form of the disclosure if necessary, because of 
special circumstances, to protect the privacy of a borrower or the 
competitive position of an institution.
* * * * *

    Dated: June 21, 2004.
John D. Hawke, Jr.,
Comptroller of the Currency.

    By order of the Board of Governors of the Federal Reserve 
System, July 1, 2004.
Jennifer J. Johnson,
Secretary of the Board.

    Dated: June 28, 2004.

    By Order of the Board of Directors of the Federal Deposit 
Insurance Corporation.
Valerie J. Best,
Assistant Executive Secretary.
    Dated: May 24, 2004.

    By the Office of Thrift Supervision.
James E. Gilleran,
Director.
[FR Doc. 04-15526 Filed 7-7-04; 8:45 am]
BILLING CODE 4810-33-P, 6210-01-P, 6714-01-P, 6720-01-P