Community development activities, in order to achieve an appropriate scale, often operate in larger areas that may not neatly overlap with a bank’s assessment area. A more expansive and ex ante clearer community development assessment area definition would afford CRA consideration for any such activity in a state where the bank has an assessment area.
This approach would help eliminate uncertainty and could encourage more capital for affordable housing, community facilities, and economic development activities in underserved areas. Moreover, a broader assessment area for community development activities could help address the concentration of investment dollars in metropolitan areas where several banks may have branches, while other smaller metropolitan and rural areas remain chronically underserved.