General Assembly Raised Bill No. 1398 aims to strengthen community reinvestment efforts by banks and credit unions, particularly for low and moderate-income neighborhoods and minority and women-owned businesses. The bill introduces new definitions, such as "minority," which includes individuals classified as non-white or Hispanic/Latino, and specifies ownership criteria for "minority-owned" and "women-owned businesses." It mandates that the commissioner assess banks' performance in meeting community credit needs, including those of minority and women-owned businesses, and requires banks to delineate their assessment areas in compliance with the federal Community Reinvestment Act (CRA). The bill also revises existing statutes, replacing certain subsections to emphasize community reinvestment and ensuring that performance evaluations include both public and confidential sections.

Additionally, the bill outlines new regulations for mortgage lenders, requiring them to file annual reports detailing their business activities and compliance with fair lending laws, with penalties for late submissions. It establishes a framework for evaluating lenders' performance in meeting residential mortgage loan needs, with ratings that can affect license renewals. The bill emphasizes transparency and accountability in the mortgage lending process and includes provisions for maintaining the confidentiality of investigation records while allowing the commissioner to share them with regulatory and law enforcement agencies. Key provisions will take effect on October 1, 2025, and aim to promote equitable lending practices and enhance oversight of banking and credit union operations.

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