Just in case you missed it, the Office of Management and Budget announced revisions affecting areas designated as Metropolitan Statistical Areas, Metropolitan Statistical Areas and Combined Statistical Areas back in February. You might be thinking, “who cares?” The answer is, you might.
Areas designated as Metropolitan Statistical Areas (MSAs) are one of the key components in determining whether you bank is subject to the Home Mortgage Disclosure Act (HMDA). HMDA is one of the most difficult compliance regulations. It takes A LOT of training for your personnel, process/procedure development and imposes civil money penalties for non-compliance.
The announcement contains many different lists of information; however, you should be mostly concerned with “List 2”. It provides information such as the MSA’s codes, principal cities, counties, etc. If your bank has locations in more than one state, you will want to check the MSAs for each state.
Let’s look at an example for the state of Nebraska, as that is where our home office is located.
List 2 shows three MSAs for Nebraska (see below). These are Grand Island, NE, Lincoln, NE and Omaha, NE/Council Bluffs, IA. You will notice that each MSA includes not only the city but also the county and even some surrounding counties.
24260 Grand Island, NE Metropolitan Statistical Area
Principal City: Grand Island
Hall County, Hamilton County, Howard County, Merrick County
*This MSA is new for 2014
30700 Lincoln, NE Metropolitan Statistical Area
Principal City: Lincoln
Lancaster County, Seward County
36540 Omaha-Council Bluffs, NE-IA Metropolitan Statistical Area
Principal Cities: Omaha, NE; Council Bluffs, IA
Harrison County, IA; Mills County, IA; Pottawattamie County, IA; Cass County, NE; Douglas County, NE; Sarpy County, NE; Saunders County, NE; Washington County, NE
If a bank has assets of $42 million or more (this threshold changes periodically) AND has a main office or branch located in one of these MSAs, the bank is subject to HMDA.
The revisions were effective immediately; however banks brand new to HMDA (as a result of the revisions) will begin collecting and reporting HMDA data on applications taken on or after January 1, 2014.
Now is the time to determine if these revisions will affect you. If they do, you need to begin learning all you can about HMDA and developing a plan to train your personnel.
Amy brings many years of banking and compliance experience to Banker’s Compliance Consulting. She has worked for both large and small financial institutions and spent time working in every area of a bank. She started out as a teller in college and eventually became a branch manager.
Her love, however, was always compliance. Amy began her career with Banker’s Compliance Consulting in 2000. Her knowledge and experiences have allowed her to develop a well-rounded and practical approach to regulatory compliance. Amy is CRCM certified, has a Bachelor’s Degree in Business Administration, and is a graduate of the ABA Compliance School.
Amy & her husband have two children at home and stay busy following their activities. They spend a lot of time in the bleachers!