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CRA Exam Survival Guide

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By Jaidyn Crookston | December 21, 2021 | 10 Minute Read

Ask an Examiner! How to Prepare for Your CRA Exam

Linda Ezuka and Jason Keller share how to prepare for your next CRA exam
Are you preparing for your next CRA exam? If you are, or you will be soon, you’d probably love to get the inside scoop on how an examiner thinks about an exam. 
 
Wouldn’t it be nice if you could sit down with a CRA examiner and pick their brain a bit? Yeah...that would be super nice. But impossible, right?
 
Wrong! 
 
We recently met with Jason Keller, a former CRA examiner and Community and Economic Development Senior Advisor at the Federal Reserve Bank of Chicago, and Linda Ezuka, CRA expert and owner of CRA Today. We asked them for their tips and tricks on how to prepare for a CRA exam, and they had a lot of great ideas! (Of course they did...they’re experts!) 
 
Here’s what they said. 
 

What to do before your exam: Complete a self-assessment

Both Jason and Linda believe that “every piece of your exam is important, but the prep piece is particularly important. This is where you have the most control to prepare and to position your bank for success.”
 
The best way to prepare for your CRA exam is by completing a self-assessment of your program. According to Linda, “Self-assessments are critical...because no one knows your bank like you do. No one is as intimate with your performance standards as you, and this is the opportunity to tell your story.”
But you can’t just complete a self-assessment once and leave it on the (metaphorical) shelf. (Metaphorical, of course, unless you still use paper. In which case, please check out Kadince! We make it easy to keep all your CRA data in one place.) Your self-assessment is never done and should be updated every 6–12 months. This will help you stay on top of any gaps that may arise and make sure you’re always prepared for an exam. 
 
 
Completing this exercise is so important that Linda even said, “If there’s one thing you take away from here, I want you to be more focused on your self-assessment.” 
 
According to Jason, your self-assessment doesn’t need to be 200 pages long. In fact, it only needs to be a few pages. Just make sure to answer these questions:
 
  • What’s changed since your last exam?
  • What are you most proud of? 
  • What was the most complicated? The most innovative?
  • What took the most work to move over the finish line? 
  • What barriers have you overcome to reach your level of success? 
 
Your self-assessment should start to “generate an interest in your institution and your assessment areas.” Show your examiner what they can’t see in the data, and your self-assessment is ready to go. Jason says that if you do this, your examiner is almost guaranteed to better understand your program and your data. 
 
Before your exam, you should also reach out to your regulator, to community partners, and to other banks similar to your own. Unlike some people, Jason doesn’t see CRA as competitive. He loves to see banks working together and helping each other during an exam. 
 
 

What to do during your exam: Start a dialogue 

When asked about some best practices during an exam, Jason said that CRA Officers need to understand the expectations of their examiners. There are going to be a lot of meetings, and you need to know how often meetings will be held, who will be your main contact, and who exactly is working on individual components of your exam like loans, investments, and services. You should also ask for an update meeting when your exam is halfway through. As Jason said, “The better examiners are very transparent about this.”
 
Jason also suggested educating your examiner about your assessment area, especially if your examiner is from out-of-state or doesn’t know your area well. Tell them what percentage of your area is rural, tell them about plant closures or other levels of economic downturn, and give them a list of community groups you’re regularly involved with. This is your chance to give context to the loans, services, and investments your bank has made. 
 
 
  
Begin a dialogue with your examiners. Sharing these points also lets you influence which community organizations your examiners speak to. 
 
Jason said, “There is no ‘A for effort’ in CRA. You need to talk about your bank’s impact and show examiners exactly what you’ve done. Show them what you’re most proud of. I don’t know any examiner who wouldn’t want to talk to you more about that and give credit where credit is due.”
 

How to manage any issues that arise

When going through a CRA exam, unexpected things are bound to happen. Maybe you don’t get credit for a loan you were certain would count. Maybe your examiner sees an investment differently than you do. No matter what, it’s important to pay attention to your examiner and not start an argument.
 
“When you’re not quite sure if something counts, or you disagree with your examiner,” Linda said, “I suggest you just listen to the examiner’s perspective. Take it all in. Try to understand where they’re coming from and offer to look at it again and revisit.”
 
When explaining your side of the story, Jason said, “It’s better to say how something qualifies rather than whether something qualifies.”
 
Maybe you just didn’t give them all documentation, or maybe they don’t have a clear picture of the community impact. Or maybe that loan or investment really shouldn’t count. Misunderstandings and disagreements are an opportunity for both you and your examiner to learn and improve your future work. “There’s give and take on every exam,” Linda said. 
 
 

How to prepare for your next CRA exam

Now that you’ve finished your CRA exam, it’s time to start preparing for the next one (after a vacation or very, very long nap of course). 
 
Finishing one exam is “the perfect opportunity to figure out what you really want to focus on during the next exam period,” Linda said. What community partnerships do you want to forge? What gaps do you need to address? It’s time to think strategically.
 
By taking some time now to reflect and carve your path forward, you can come up with a solid CRA plan for the next exam period.
 
Once you’ve built a strategic plan, take it to your executive management team. There’s a lot of awareness for the CRA program right now, so any concerns or ideas you have now may get the support you need going forward. 
 
Jason said that now is not the time to stop speaking with your previous examiner. Even though your exam is over, you should schedule some time to meet with them and discuss your score. Ask the examiner what assessment areas you should spend more time on and how they think your program could improve. Address any lingering questions you may have. This is part of building a relationship with your CRA examiner, something you should be striving to do throughout your entire exam process. 
 
You should continue a dialogue with your examiner after your exam. As a former examiner himself, Jason said “examiners should not have a problem going over the list with you after an examination of things you didn’t get credit for.” This is a great learning opportunity and a way to clean up your process. Now you can start preparing for your next exam by fixing some of the problems your examiner saw. 
 
As you prepare for your next exam, Jason cautioned against forgetting to include all parts of your bank. Talk to investment officers, managers, and even tellers. “CRA can come from any level of the organization, and there can be success stories at any level,” he said.
 
Even though you’ve finished one exam, Linda said, you’ll still need your self-assessment and a new CRA plan. This is a great time to reflect on how you thought you would perform versus how you actually performed. Take your examiner’s feedback and work backward from there. Now you can move forward with confidence and a solid plan for the next exam cycle. 
 
  
Last but not least, Jason suggested that you reach out to other banks in your area. Ask them about their exams, learn from their mistakes and successes, and build partnerships between your organizations. 
 
It may seem silly to begin preparing for your next CRA exam right after this one. You have a few years, after all. But don’t forget how much work goes into exam preparation. When you take time now to identify gaps in your program and fix those gaps (as well as document everything you do), you’ll find yourself running a much smoother program. While you may spend more time now planning a strategy and preparing for your next exam, in 2–5 years, you’ll be glad you did. 
 
Want more CRA exam prep tips? Download the CRA Exam Survival Guide
 
 
 
The information in this article came from our webinar with Jason Keller, a former CRA examiner, and Linda Ezuka, founder of CRA Today. You can view the webinar recording here.


None of Kadince, Inc., its affiliates, or its respective employees, directors, officers, and agents (collectively, “Kadince”) are responsible or liable for any content or information incorporated herein. Read full disclosure.

The views Jason Keller and Linda Ezuka expressed in this presentation are their own and do not necessarily represent the views of the Federal Reserve Bank of Chicago, the Federal Reserve System, or any other regulatory banking authority. This article and the information presented herein is intended for informational use and is not legal advice. If you have specific legal questions, you should consult an attorney.

Jaidyn Crookston | Content Manager, Kadince


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