Overview
- The Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation released the proposal on Friday, July 31, 2026, saying banks would no longer get automatic CRA credit for donations to advocacy groups.
- Regulators would require banks to document that community development grants finance local lending and would limit recipient overhead to about 15 percent for qualifying grants.
- The plan raises the small-bank asset threshold to $1 billion and creates an intermediate tier at $10 billion that would exempt many banks under $10 billion from some data collection and reporting duties.
- Democrats called the change a gutting of a tool used to drive affordable housing and community investment while Republicans praised it as a correction of activist leverage, and officials warned legal challenges are likely.
- Because the Federal Reserve did not issue a matching proposal, state‑chartered banks supervised by the Fed could remain under prior rules, creating a risk of patchwork standards and uneven enforcement that could change how banks and local nonprofits negotiate community programs.