On July 15, 2025, the Federal Deposit Insurance Corporation (FDIC) Board of Directors met in a public Sunshine Act session and voted to suspend implementation of the 2023 Community Reinvestment Act (CRA) Final Rule. Citing implementation challenges – particularly confusion and inconsistent understandings among stakeholders regarding the status of the CRA regulatory and supervisory landscape, in addition to pending litigation and widespread shifts in supervisory priorities, the FDIC proposed adoption of Notice of Proposed Rulemaking (NPR) on Community Reinvestment Act Regulations. The action, backed unanimously by the FDIC, aims to restore certainty in the CRA regulatory framework and limit regulatory burden on banks. Furthermore, it aligns with interagency expressions of concern signaling mutual agreement to roll back CRA modernization efforts. Public comment is requested for a period of 30 days after publication in the Federal Register.
Adoption of the NPR would rescind the 2023 CRA Final Rule and replace it with the 1995 CRA Regulations placing the Retail Lending and Community Development Financing Tests and their related quantitative benchmarks on hold and relieving banks with assets of $10 billion or more from requirements to gather expanded deposit, loan, and service data mandated by the now-suspended rule. Effective immediately, the FDIC will continue examining banks within their legacy assessment areas, applying the longstanding lending, investment, and services tests that governed CRA performance prior to 2023. Additionally, examiners will maintain narrative-driven assessments and qualitative scoring models, mirroring the review procedures in place pre-2023.
Next Steps
In light of today’s ruling, financial institutions should take a “business-as-usual” stance. Management should continue evaluations to refine and strengthen existing CRA programs, monitor supervisory releases for future CRA updates, and sustain open dialogue with examiners and other key stakeholders to ensure your institution is positioned for continued compliance and recognition of community development efforts.
While the timeline for modernization efforts is uncertain, our team is closely monitoring developments and stands ready to help you navigate this evolving regulatory landscape.