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FEDERAL RESERVE BANK OF NEW YORK & 10June299 20, 1989 HOME MORTGAGE DISCLOSURE ACT Timeliness and Accuracy of HMDA Reports To All Institutions in the Second Federal Reserve District Subject to the Home Mortgage Disclosure Act: Following is the text of a press release issued by the Federal Financial Institutions Examination Council: The Examination Council has announced its approval of a Statement on the Home Mortgage Dis closure Act (HMDA). The purpose of the Statement is to encourage financial institutions covered by the HMDA to file timely and accurate HMDA reports. Under the HMDA, the Council is required to make aggregate data on home mortgage lending for a particular year available to the public by December 31 of the following year. Such reports are used by individuals, community organizations, and government agencies to evaluate the performance of fi nancial institutions in making mortgage credit available in the communities in which they have offices. The reports, for example, can be used to compare lending among different neighborhoods within a par ticular metropolitan area and to compare the lending patterns of individual financial institutions with the total for all institutions. The data in the reports also show aggregate lending patterns for various cat egories of census tracts grouped according to income categories, racial characteristics, geographic lo cation, and age of housing stock. Reports of their mortgage lending by individual financial institutions — commercial banks, savings institutions, credit unions, and certain mortgage banking companies — provide the raw data that are used by the Council to produce the HMDA aggregation reports. Consequently, the timeliness and ac curacy of the reports produced by the Council depend greatly on the timeliness and quality of the in dividual HMDA reports submitted by the financial institutions. Printed on the following pages is the Council’s Statement. The manual referred to therein, en titled A Guide to HMDA Reporting — Getting it Right!, has been mailed to you. The census tract list and the instructive videotape, also referred to in the Statement, are being prepared; you will be notified when they become available. Questions on this matter, and requests for copies of the HMDA manual, may be directed to Joy Bridgelall of our Compliance Examinations Department (Tel. No. 212-720-1591). E. G e r a l d C o r r ig a n , President. Federal F in an cial In stitu tio n s Examination Council A 1776 G Street, NW, Suite 701 • Washington, EXT 20006 Federal Financial Institutions Examination Council Statement on the Home Mortgage Disclosure Act The Federal Financial Institutions Examination Council’s member agencies are the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Federal Home Loan Bank Board, the National Credit Union Administration, and the Office of the Comptroller of the Currency. The FFIEC is issuing this statement to encourage institutions covered by the Home Mortgage Disclosure Act (HMDA or the Act) to adhere to the specific requirements of the Act and Regulation C (12 CFR 203 ). The agencies are concerned about the number of reporting errors in the HMDA report and the large number of reports received from financial institutions after the March 31 due date. 1 FFIEC) The FFI'EC is required by the Act to make HMDA aggregation tables for the previous year available to the public no later than December 31 of each year. Although the FFIEC has met this goal, there is strong Congressional and public interest in making the aggregation tables available earlier in the year. In the conference report that accompanies the February 1988 amendments to HMDA, the Congress called upon the FFIEC and the agencies to take measures to expedite the availability of the HMDA data. Issuance of this Statement is one of these measures. Covered institutions are encouraged to develop policies and procedures that willensure full compliance with the HMDA and Regulation C. It isthe agencies' policy to provide institutions with guidance to assist them in providing timely and accurate reports. HMDA compliance will be emphasized in examinations. The agencies will also consider what supervisory and enforcement actions may be appropriate to ensure compliance. The FFIEC and the agencies have already taken steps to assist covered institutions in improving their performance: • The FFIEC hasissued a manual, entitled A Guide to HMDA Reportinq--Getting it Rightl, which provides an executive overview for management and an instructional section for persons preparing the HMDA report forms. The guide is being made available by the agencies. Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Federal Home Loan Bank Board, National Credit Union Administration, Office of the Comptroller of the Currency • The FFIEC has developed a reformatted census tract list that identifies the specific census tract numbers for each metropolitan statistical area with codes to indicate small and untracted counties that must be reported by county name. In addition, the list identifies counties with dual census tracts that must be reported by both county name and census tract number. These lists will help prevent reporting errors and are available upon request from each agency. • A videotape entitled "How to Prepare a HMDA Statement" is being prepared to assist in familiarizing compliance personnel with the requirements of HMDA and Regulation C. This instructive video will be made available upon request from the agencies at a nominal cost. It will assist institutions in preparing calendar year 1989 statements that are due March 31, 1990. Timely and accurate HMDA reporting is not only required by law, it is essential if the aggregate HMDA data is to be made available to the public at the earliest possible date. A cooperative effort among the agencies and the covered institutions is imperative. Suggestions on how to help ensure accurate and timely submission of the HMDA disclosure form are invited and encouraged. Suggestions or comments should be forwarded to: Robert J. Lawrence Executive Secretary Federal Financial Institutions Examination Council 1776 G Street, NW / Suite 701 Washington, DC 20006
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