John Sarbanes: “Second, Mr. President, is the provision for a safe harbor for banks with a ``satisfactory'' CRA rating. Actually, what…”

“Second, Mr. President, is the provision for a safe harbor for banks with a ``satisfactory'' CRA rating. Actually, what this provision would do is effectively eliminate public comment on CRA performance. Banks that had received a ``satisfactory'' or better rating at the recent exam, and during the preceding 3 years, would be deemed to be in compliance with CRA and immune from public comments on CRA performance. That would be the case unless you had substantial, verifiable information to the contrary--which of course is a very heavy burden of proof. Actually the regulators oppose this. Comptroller of the Currency Hawke stated: Public comment is extremely valuable in providing relevant information to an agency in its evaluation of an application under the CRA, convenience and needs and other applicable standards--even by an institution that has a ``satisfactory'' CRA rating. This amendment would limit or reduce public comment that is useful in our application process. And there is a similar comment from Ellen Seidman, the Director of the Office of Thrift Supervision. Public comment is useful because many banks or regulators sample only a portion of the markets to determine the institution's CRA rating. Public comment provides an opportunity for community members to point out facts and data that have been overlooked in a particular examination.”