Small Business Lending Collection and Reporting – ON-DEMAND WEBINARS

Recorded: October 27, 2021

Presented by: Ms. Anetria Cohen, Vice President and Senior Consultant, FORVIS

A two-hour webinar that reviews the CFPB’s proposed rule that implements Section 1071 of the Dodd-Frank Act.

Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act requires the Consumer Financial Protection Bureau (CFPB) to adopt regulations governing the collection of certain data regarding women-owned, minority-owned, and small businesses. This section is intended to facilitate enforcement of the fair lending laws, as well as enable the government and industry to identify needs and opportunities for such businesses.

On September 1, 2021, the CFPB issued a proposed rule to implement these changes and require covered financial institutions to collect and report to the CFPB data on applications for credit for these types of loans. The almost 1,000 page notice is detailed and complicated, and includes numerous additional rules and clarifications to existing rules and concepts. This rule will require significant training to business/commercial lenders who already struggle with existing compliance requirements or insist there are no compliance requirements for business/commercial loans. The rule specifically prohibits loan officers from encouraging applicants to skip the page that asks for information.

This webinar will review the CFPB’s proposed rule. While this is a proposal and there may be some revisions, it is important for financial institutions to be aware of the potential future requirements. Reviewing this rule for non-HMDA reporters will be especially important, as the proposed rule incorporates certain concepts from Regulation C, the regulation that implements the Home Mortgage Disclosure Act.

HERE’S WHAT YOU’LL LEARN:

• Coverage and Definitions
  • “Covered” financial institution
  • “Covered” applications
  • “Small business”, including what is “minority-owned” and “women-owned”
• Data Points, including, but not limited to, information regarding the:
  • Application (e.g., identifiers, application date, action taken, denial reasons)
  • Pricing (origination fees; initial annual charges)
  • Credit (type, purpose)
  • Business (census tract; gross annual revenue)
  • Demographics and ownership status of the principal owners
• “Reasonably designed to obtain a response” procedures
  • Reporting requirements
  • Recordkeeping
  • Limits on certain employees’ access to the information (“firewall”)
  • Proposed Effective and Compliance Dates