Independent Banker - September 2023 - 58

of people to its compliance committee
and reviewed its various procedures
and processes to see what needed to
change, Johnson says.
For example, the community bank
knew its audit scope was going to be
much larger, so the audit department
had to beef up staff by several people
and ensure its documentation was
more robust, knowing examiners
were likely to be more critical in this
area, Johnson says.
-JOSEPH E. SILVIA, DICKINSON WRIGHT
Expect snags
While MainStreet Bank was still in
the testing stage, it found some kinks
in its new processes. Because it had
started early, however, the bank
was able to test for three-quarters
of the year and clean up any issues
it identified.
" If you are able to get ahead of it as
early as you are legally able to, it helps
ensure you are ready when the time
comes, " Baboval says.
CorTrust found the process took
longer than expected, in part because
11 First Minnesota Bank branches
needed to be converted to CorTrust's
core provider. There were also
priorities the bank had to focus on
at the same time it was preparing to
" You have to have comprehensive
change-management processes in
place. These things don't happen
overnight, " says Hunt-Fuhr, who's also
a former bank examiner.
When Bank of Charles Town was in
the process of crossing the new CRA
threshold, Carson was responsible
for making sure the bank had new
processes in place so it could meet
the additional requirements and
identify the community development
transactions for purposes of the
new threshold. This meant keeping
management abreast of the upcoming
regulatory changes and developing
an internal implementation
team with key subject matter
experts and representatives from
information technology to discuss
the new requirements and what the
process for identifying community
development activities would look like
in the future.
There was also significant work
in identifying examples of what
regulators consider community
development, partnering with
commercial lending to determine
how processes would change, and
determining potential vendor and
staffing shifts, Carson says.
In preparation for its new asset
threshold, CorTrust added a handful
58 // ICBA Independent Banker // September 2023
reach its new asset threshold.
" Things come up that you maybe
didn't plan for; that's why you need
to give yourself a long runway when
planning to reach a new threshold
because you still need to do your dayto-day
tasks, " Johnson says.
Track your progress
Baboval also recommends community
banks build tracking mechanisms
to help identify where they are
with respect to meeting their new
regulatory targets. This helps banks
know what to change, what not to
change and where gaps exist, he says.
Developing this type of tracking
system while it was transitioning to a
new CRA threshold gave MainStreet
Bank a " reasonable assurance " it
was on target to meet regulatory
expectations, Baboval says.
Independent Banker - September 2023

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