Federal Financial Institutions Examination Council
|For Immediate Release||August 1, 2002|
The Federal Financial Institutions Examination Council (FFIEC) today announced the availability of data on small business, small farm, and community development lending reported by commercial banks and thrifts.
The regulations that implement the Community Reinvestment Act (CRA) generally require the reporting of data on these types of lending by independent commercial banks and savings associations having total assets of $250 million or more, and by commercial banks and savings associations of any size if owned by a holding company having assets of $1 billion or more. Analysis of Call Report and Thrift Financial Report data indicates that reporting institutions account for about 84 percent of the number of small business loans and about 32 percent of the number of small farm loans extended by all commercial banks and savings associations.
The 2001 CRA data reflect originations and purchases of small business, small farm, and community development loans from 1,912 institutions, including 1,443 commercial banks and 469 savings associations. (See attached fact sheet and related tables.) Approximately 6 million small business loans, totaling about $225 billion, and approximately 235,000 small farm loans, totaling about $14 billion, were reported for 2001. The number of small business loans reported in 2001 increased by 19 percent from 2000; the total dollar amount of these loans increased by about 26 percent from 2000 to 2001. The number of small farm loans reported in 2001 increased by 15 percent from 2000; the total dollar amount of these loans increased by 23 percent.
About 44 percent of the small business loans reported for 2001 were extended to borrowers with revenues of $1 million or less, down sharply from a high point of 60 percent in 1999. The proportion of small farm loans made to borrowers with revenues of $1 million or less in 2001 was 90 percent, about the same percentage as in 2000. The vast majority of reported small business loans (92 percent) and small farm loans (83 percent) extended in 2001 were for amounts under $100,000. Small business loans were heavily concentrated in central city and suburban areas, as are both the U.S. population and U.S. businesses. Small farm loans were heavily concentrated in rural areas.
The variation in small business lending among census tracts grouped into income categories generally parallels the distribution of the population and businesses among these categories. Most small farm loans are made in rural areas regardless of income. A comparison of small business lending activity in low- and moderate-income areas in 2001 with 2000 shows that the share of the total number of loans and of the dollar amount of lending in these areas remained about the same. The same year-over-year pattern is observed for lending in middle- and upper-income areas.
The small business and small farm lending data reported under the CRA regulations are more limited than the data reported on home mortgage lending under the Home Mortgage Disclosure Act (HMDA). The CRA data include information on loans originated or purchased, not on applications that are turned down or withdrawn by the applicant. The CRA data are not reported application-by-application; rather, the CRA data are aggregated into three loan-size categories and then reported at the census tract level.
In 2001, commercial banks and savings associations reported community development lending that totaled about $25 billion. The dollar amount of community development loans increased by about 25 percent from 2000 to 2001. The number of these loans is larger than in 2000, up about 8 percent to 26,000.
A community development loan has as its primary purpose affordable housing for low- or moderate-income individuals, community services targeted to these individuals, activities that promote economic development by financing small businesses or small farms, or activities that revitalize or stabilize low- or moderate-income neighborhoods. Under CRA regulations, retail institutions do not report community development loans as small business or small farm loans, or as home mortgage loans under HMDA (except for multifamily dwelling loans reported under HMDA).
From the 2001 CRA data reported, the FFIEC has prepared a disclosure statement, in electronic form, for each reporting commercial bank and01/15/2009 10:56 AMure statements of small business and small farm lending for each of the metropolitan areas and each of the non-metropolitan counties in the United States and its territories, and has distributed these statements to central depositories throughout the nation, where they are available for public inspection. The 2001 CRA data will be available on the FFIEC website today. An order form for CRA data and related items, with descriptions of the various reports and formats available, is attached to this release. Central depository locations, and an order form for other data available from the FFIEC (including data on home mortgage loans, reported under HMDA), can be found at the FFIEC website (www.ffiec.gov/cra).
The FFIEC was established in March 1979 to prescribe uniform principles, standards, and report forms and to promote uniformity in the supervision of financial institutions. The Council has five member agencies: the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision. The Council's activities are supported by interagency task forces and by an advisory State Liaison Committee, comprised of five representatives of state agencies that supervise financial institutions.