Banking and Finance Law Daily Wrap Up, COMMUNITY DEVELOPMENT—ABA asks OCC to clarify revised MDI policy, (Jul 21, 2026)
Organizations Mentioned:American Bankers Association | Office of the Comptroller of the Currency | Windfall Systems, Inc.
By Lauren Bikoff, MLS
The ABA requests guidance on what constitutes a “material change” for an existing MDI.
The American Bankers Association (ABA) has submitted comments to the Office of the Comptroller of the Currency (OCC), asking for clarification on the agency’s revised policy statement on minority depository institutions (MDIs). The banking organization warned that the updated policy statement may create uncertainty for institutions to qualify for or keep the designation. ABA said the standard for evaluating “socially and economically disadvantaged” status should be transparent, consistent, and operationally practical, and it recommended frequently asked questions or additional written guidance.
In June, the OCC released an updated policy statement on MDIs, which revised the definition of an MDI to “more closely” align with its definition under federal law (see Banking and Finance Law Daily, Jun. 17, 2026). However, the ABA believes that the revised policy could “introduce a subjective and individualized framework for evaluating qualifying ownership and control, which may create uncertainty for prospective bank organizers, investors, and existing MDIs” on how status will be judged during mergers, acquisitions, ownership changes, capital raises, and other strategic transactions.
The immediate reassessment question centers on existing designations. ABA said Section 3.C appears to let existing MDIs maintain their designation, but also says OCC examiners may reassess a designation if the facts underlying it before issuance of the policy statement undergo a “material change.” ABA asked the OCC to clarify that perceived inconsistency and explain what might trigger an immediate reassessment.
ABA also questioned the annual review process. It said the policy statement provides for an OCC annual review to determine whether an institution continues to satisfy the MDI definition or whether a maintained designation remains appropriate. ABA urged the agency to identify the factors that will guide those reviews and to provide objective criteria or examples showing when routine business developments could affect MDI status.
Companies: American Bankers Association
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