CRCM Community Reinvestment Act (CRA) Compliance 2

Question 1

Which of the following BEST qualifies as a community development service under CRA?

Accepted Answer

Providing free financial literacy workshops to low- and moderate-income individuals

Answer

Offering premium interest rates to attract high-net-worth depositors

Answer

Installing ATMs exclusively in high-income shopping districts

Answer

Developing mobile banking features targeted at business customers

Question 2

Under CRA, the public file that a bank must maintain includes:

Accepted Answer

The bank's current CRA public notice and its most recent CRA performance evaluation

Answer

Individual borrower credit scores and underwriting notes

Answer

Proprietary loan pricing models used by underwriters

Answer

Compensation details for CRA compliance officers

Question 3

The CRA lending test for large banks primarily evaluates:

Accepted Answer

Geographic distribution and borrower characteristics of home mortgage, small business, small farm, and community development loans

Answer

The profitability of loans made in the bank's assessment area

Answer

Only home mortgage loans made to LMI borrowers in LMI census tracts

Answer

The total number of loans approved versus denied each calendar year

Question 4

Approximately how often are CRA performance evaluations typically conducted for banks in good standing?

Accepted Answer

Every 2 to 5 years, depending on bank size and prior rating

Answer

Annually for all banks regardless of prior rating

Answer

Monthly as part of ongoing regulatory supervision

Answer

Only when a bank applies for a merger or new branch

Question 5

The CRA strategic plan option allows a bank to:

Accepted Answer

Set its own measurable CRA goals, subject to public comment and regulatory approval

Answer

Defer CRA compliance for up to three years while developing internal systems

Answer

Be exempt from the lending test if it commits to community investment targets

Answer

Use peer bank benchmarks instead of assessment-area-specific targets

Question 6

Which federal agencies are responsible for conducting CRA examinations?

Accepted Answer

The Federal Reserve, OCC, and FDIC

Answer

The SEC, FINRA, and the Treasury Department

Answer

Only the CFPB for all consumer compliance matters

Answer

The NCUA for all federally insured institutions

Question 7

Which of the following would MOST likely qualify as a CRA investment under the investment test?

Accepted Answer

Investing in a Low-Income Housing Tax Credit (LIHTC) partnership in the assessment area

Answer

Purchasing U.S. Treasury bills for the bank's investment portfolio

Answer

Acquiring stock in a large regional competitor bank with strong earnings

Answer

Buying AAA-rated commercial mortgage-backed securities on the secondary market