PUBLIC DISCLOSURE COMMUNITY REINVESTMENT ACT PERFORMANCE EVALUATION First Utah Bank RSSD # 207872 3826 South 2300 East 84109 Federal Reserve Bank of San Francisco 101 Market Street San Francisco, California 94105 NOTE: This document is an evaluation of this institution's record of meeting the credit needs of its entire community, including low- and moderate-income neighborhoods, consistent with the safe and sound operation of the institution. This evaluation is not, nor should it be construed as, an assessment of the financial condition of this institution. The rating assigned to this institution does not represent an analysis, conclusion or opinion of the federal financial supervisory agency concerning the safety and soundness of this financial institution.
TABLE OF CONTENTS INSTITUTION RATING 1 Institution's CRA Rating... 1 INSTITUTION 2 Description of Institution...... 2 Description of Assessment Area... 2 Economic Conditions... 5 Credit Needs...................................... 7 Scope of Examination... 8 CONCLUSIONS WITH RESPECT TO PERFORMANCE CRITERIA 9 Loan-to-Deposit Ratio...... 9 Lend ing in Assessment Area... 9 Lending Distribution by Geography... 9 Lending Distribution by Business Revenue... 10 Response to Com plaints... 10 Fa i r Lend ing or Other Illegal Practices Review... "... "".. "... 11 GLOSSARY OF TERMS 12
INSTITUTION RATING Institution's era Rating First Utah Bank is rated "SATISFACTORY" The major factors supporting the institution's rating include: A reasonable loan-to-deposit ratio; A substantial majority of loans originated within the bank's assessment area; and A reasonable geographic distribution of small business loans. These factors are all offset by a comparatively low level of lending to small businesses. 1
INSTITUTION Description of Institution First Utah Bank (FUB) headquartered in, with total assets of $273 million as of December 31, 2012, is a wholly-owned subsidiary of First Utah Bancorporation, a one-bank holding company. The bank currently operates a network of eight full-service branches in Salt Lake County - three branches are located in Salt Lake City, two in West Valley City and one each in the cities of Midvale, Riverton and Sandy. FUB also operates one nonbank subsidiary, Premier Data Corporation, which began operations in June 1998, to provide data processing services for FUB and other financial institutions. FUB is a full-service community bank that provides products and services targeted to both businesses and consumers. Loan products are targeted to its business clientele and primarily include commercial and commercial real estate loans, working capital lines of credit, and Small Business Administration (SBA) loans. Consumer loans, mortgage loans, home equity lines of credit, and single-family residential construction loans are also available. Exhibit 1 below is from the December 31, 2012, Consolidated Reports of Condition and Income, which shows the bank's commercial lending focus. Commercial/Industrial & Non-Farm Non-Residential Real Estate EXHIBIT 1 LOANS AND LEASES AS OF DECEMBER 31, 2012 Loan Type $ ('ODDs) % 102,552 63.0 Secured by 1-4 Family Residential Real Estate 26,908 16.5 Construction & Land Development 18,090 11.1 All Other 10,297 6.3 Multi-Family Residential Real Estate 2,036 1.2 Consumer Loans & Credit Cards 1,683 1.0 Farm Land & Agriculture 1,488 0.9 Total (Gross) 163,054 100.0 During this review period, FUB faced no legal or financial impediments that would prevent it from helping to meet the credit needs of its assessment area consistent with its business strategy, size, financial capacity, and local economic conditions. The bank received a satisfactory rating at its previous CRA examination, which was conducted as of February 28, 2011, by the Federal Reserve Bank of San Francisco, using the Interagency Intermediate Small Institution CRA Examination Procedures. Description of Assessment Area FUB's assessment area consists of Salt Lake County in its entirety, which has not changed since the previous CRA examination. The county is located in north central Utah between the Wasatch Mountains 2
on the east and the Oquirrh Mountains and the Great Salt lake on the west. It is part of the Salt Lake City Metropolitan Statistical Area (MSA). Salt lake City (SLC) is the largest city in the assessment area. The county is home to several cities including: Alta, Bluffdale, Cottonwood Heights, Draper, Herriman, Holladay, Kearns, Magna, Midvale, Murray, Riverton, Sandy, South Jordan, South Salt lake City, Taylorsville, West Jordan, and West Valley City. In 2011, SlC had an estimated population of 1,048,985 1 and a median household income of $70,400. 2 FUB has a relatively limited presence in the assessment area. As of June 30, 2012, FUB's eight offices held $214.2 million in deposits, which represented 0.07 percent of the market share; ranking the bank 27th out of 45 Federal Deposit Insurance Corporation (FDIC) insured financial institutions operating in the area. 3 large national banks have a significant presence in this area, with the top four banks, ranked by deposit share, comprising over 60 percent of the market. Additionally, in 2011, there were 71 lenders reporting small business loans, pursuant to the reporting requirements of the CRA, most of which were large multi-national and regional banks, thrifts, and credit unions. These institutions, which represent only a portion ofthe overall commercial lending market, extended nearly 23,000 small business loans aggregating over $787 million. In 2011, there were also 284 lenders reporting home mortgage loans pursuant to the Home Mortgage Disclosure Act (HMDA). These lenders extended nearly 46,000 home mortgage loans aggregating to over $9.4 billion. Accordingly, in SlC there is a high level of competition for small business and home mortgage loans from the many commercial banks, savings banks, credit unions, and mortgage lenders operating in the area. Exhibit 2, on the next page, presents key demographic and business information used to help develop a performance context for the assessment area, based on 2000 U.S. Census and 2011 Dun and Bradstreet data, applicable to the bank's lending in 2011. Exhibit 3, on page 5, provides information, drawn from the 2010 U.S. Census applicable to the bank's lending in 2012. Dun & Bradstreet data is not yet available for 2012. The SlC assessment area, while maintaining the same geographic boundaries, experienced an increase in population and in the number of census tracts since the 2000 census. Total census tracts increased from 193 to 212 representing a nine percent increase. Specifically, the number of low-income census tracts increased 140 percent, from five to 12 and middle- and upper-income census tracts increased eight percent, from 145 to 157. However, the number of moderate-income census tracts decreased five percent, from 43 to 41. 1 U.S. Census Bureau, State & County Quick Facts Salt lake County (accessed February 21, 2013); available from http://quickfacts.census.gov/qfd/index.htm I 2 FFIEC median family income (formerly the HUD-Adjusted median family income) by county through 2012, Salt lake County 3 FDIC, Deposit Market Share, Summary of Deposits Salt lake County, June 30, 2012 (accessed February 22, 2013); available from http://www2.fdic.gov/sod/ 3
Salt Lake Citv, Utah Income Categories Tract Distribution EXHIBIT 2 ASSESSMENT AREA DEMOGRAPHICS SALT LAKE COUNTY 2011 Families by Tract Income Families < Poverty Level as % of Families by Tract Families by Family Income # % # % # % # % Low-income 5 2.6 1,486 0.7 320 21.5 36,086 16.7 Moderate-income 43 22.3 46,752 21.7 5,973 12.8 42,400 19.6 Middle-income 90 46.6 107,901 50.0 4,820 4.5 53,572 24.8 Upper-income 55 28.5 59,725 27.7 1,263 2.1 83,806 38.8 Total AA 193 100.0 215,864 100.0 12,376 5.7 215,864 100.0 Housing Housing Types by Tract Income Categories Units by Owner-Occupied Rental Vacant Tract # % % # % # % Low-income 2,686 432 0.2 16.1 1,899 70.7 355 13.2 Moderate-income 85,792 35,447 17.4 41.3 44,236 51.6 6,109 7.1 Middle-income 148,513 105,628 51.9 71.1 36,858 24.8 6,027 4.1 Upper-income 73,997 62,183 30.5 84.0 8,458 11.4 3,356 4.5 Total AA 310,988 203,690 100.0 65.5 91,451 29.4 15,847 5.1 Total Businesses Businesses by Tract & Revenue Size Income Categories by Tract Less Than or Equal Greater than $1 Revenue Not to $1 Million Million Reported # % # % # % # % Low-income 3,780 6.1 2,817 5.0 786 18.2 177 9.6 Moderate-income 12,608 20.3 10,663 19.1 1,456 33.7 489 26.5 Middle-income 25,986 41.9 23,976 42.9 1,311 30.3 699 37.9 Upper-income 19,691 31.7 18,443 33.0 769 17.8 479 26.0 Total AA 62,065 100.0 55,899 100.0 4,322 100.0 1,844 100.0 Percentage of Total Businesses 90.1 7.0 3.0 2011 Median Family Income $68,010 December 2011 Median Housing Value $180,000 2011 HUD Adjusted Median Family Income $70,400 December 2011 Unemployment Rate 5.3% 4
EXHIBIT 3 ASSESSMENT AREA DEMOGRAPHICS SALT LAKE COUNTY 2012 Income Categories Tract Distribution Families by Tract Income Families < Poverty Level as % of Families by Tract Families by Family Income Low-income Moderate-income Middle-income Upper-income Tract not reported Total AA Income Categories Low-income Moderate-income Middle-income Upper-income Total AA # % # % # % 12 5.7 9,919 4.2 2,424 24.4 41 19.3 40,818 17.3 5,825 14.3 97 45.8 117,596 49.7 7,348 6.2 60 28.3 68,171 28.8 1,977 2.9 2 0.9 0 0.0 0 0.0 212 100.0 236,504 100.0 17,574 7.4 Housing Housing Types by Tract Units by Owner-Occupied Rental Tract # % % # % 21,121 5,780 2.5 27.4 13,372 63.3 72,986 32,253 14.0 44.2 34,377 47.1 172,754 118,952 51.8 68.9 45,648 26.4 90,152 72,652 31.6 80.6 12,041 13.4 357,013 229,637 100.0 64.3 105,438 29.5 # % 44,361 18.7 44,867 19.0 54,127 22.9 93,149 39.4 0 0.0 236,504 100.0 Vacant # % 1,969 9.3 6,356 8.7 8,154 4.7 5,459 6.1 21,938 6.1 2011 Median Family Income 4 $68,010 December 2012 Median Housing Value $205,000 2012 HUD Adjusted Median Family Income $71,300 December 2012 Unemployment Rate 4.9% Economic Conditions Industry in SLC encompasses various sectors such as education, healthcare, financial services, technology and manufacturing. SLC is also highly dependent on state and local government employment. Leading employers are Delta Airlines, Intermountain Health Care, Inc., University of Utah, Wal-Mart Stores, Inc., and Zions Bancorporation, each employing thousands of area residents. 5 In addition, the financial services industry is a strong driver in the economy.6 Major credit and financial companies maintain operations in the area including American Express, JP Morgan Chase, Morgan Stanley/Discover Card, and Providian Financial Corporation. 7 Technology is one the areas fastest growing industries, and SLC is considered the high-tech hub of Utah. In recent years, low business costs and an educated workforce have made SLC attractive to technology companies and business investment. The University of Utah has produced a number of local technology companies including Echelon Bioscience, Evans & Sutherland, Merit Medical, Myriad Genetics, and many others. Large technology companies such as Cadence Design Systems, Cephalon, Inc., ebay, Inc., 4 2012 Median Family Income Data is not yet available. 5 Economy.com's Precis Metro, Salt Lake April 2012. 6 Salt Lake County, Economic Development, Industry, Bio-Science (accessed March 28, 2013); available from http://econdev.slco.org/industry/bioscience. html 7 Salt Lake County, Economic Development, Industry, Financial Services (accessed March 28, 2013); available from http://econdev.slco.org/industry/financial.html 5
Fairchild Semiconductor, Siebel Systems, Inc., and Unisys Corporation are also growing their operations in SLC. Further, technology employment has risen faster in SLC than in 90 percent of all metro areas since the first quarter of 2008. 8 An array of small businesses (Le., those with gross annual revenues of $1 million or less), also make up a substantial majority of all businesses in the assessment area and provide an important source of employment. In 2011, the assessment area was home to approximately 56,000 small businesses. Although SLC experienced the effects of the recession and financial crisis in 2010; SLC's labor market outperformed most of the United States during the review period. In 2011, unemployment rates of 6.5 percent in SLC and 6.7 percent in Utah were considerably lower than the United States' unemployment rate of 8.9 percent. 9 Likewise, Utah fared better than most states, and in 2011 ranked 11th based on annual unemployment rates across the nation. 10 Further by December 2012 the unemployment rate in SLC and Utah declined even further to 4.9 percent and 5.2 percent respectively.ll Additionally, as previously described, SLC's strengths include its educated workforce, which possesses slightly higher levels of educational achievement, compared to the entire United States. 12 Nonetheless, in an average month between 2011 and 2012, an approximated 33,000 to 39,000 workers were seeking employment in SLC. 13 During most of the review period, SLC reported strong home sales and rising prices. At the beginning of the review period, the median sales price of a home in SLC was $187,000. 14 Yet, by the end of 2012, the median sales price had increased 9.6 percent to $205,000. 15 Despite increasing home prices, for a SLC family earning the median family income, home ownership is not entirely out of reach. To illustrate, in 2011, those earning the median family income of $70,000, may be able to qualify for a 30-year fixed rate mortgage of up to $298,842 with an interest rate of five percent, no down payment, and no existing debt.16 While this estimate is based on the median family income, many individuals earn far less and could find homeownership challenging as home prices increase. Further, for many low- and-moderateincome individuals, rental housing in SLC is already unaffordable. In SLC, approximately 40 percent of 8 Economy.com's Precis Metro, Salt Lake August 2012. 9 U.S. Bureau of Labor Statistics, Local Area Unemployment Statistics Salt Lake, 2011 Annual average and estimated December 2012 Monthly Average, not seasonally adjusted (accessed February 22, 2013); available from http://www.bls.gov/lau/#tables. 10 U.S. Bureau of Labor Statistics, Unemployment Rates for States Annual Average Rankings 2011 not seasonally adjusted (accessed February 26, 2013); available from http://www.bls.gov/lau/lastrk11.htm 11 U.S. Bureau of Labor Statistics, Local Area Unemployment Statistics Salt Lake, 2011 Annual average and estimated December 2012 Monthly Average, not seasonally adjusted (accessed February 22, 2013); available from http://www.bls.gov/lau/#tables 12 U.S. Census Bureau, American Community Survey, Select Social Characteristics Salt Lake County, Utah and United States (accessed February 22, 2013); available from http://factfinder2.census.gov, 13 U.S. Bureau of Labor Statistics, Local Area Unemployment Statistics Salt Lake, 2011 Annual average and estimated December 2012 Monthly Average, not seasonally adjusted (accessed February 22, 2013); available from http://www.bls.gov/lau/#tables 14 Utah Association of Realtors, Quarterly Activity by County Ql-2011, (accessed February 26,2013); available from http://utahrealtors.com/news-center/housing-statistics/quarterly-reports/ 15 Utah Association of Realtors, Quarterly Activity by County Q4-2012, (accessed February 26, 2013); available from http://utahrealtors.com/news-center/housing-statistics/quarterly-reports/ (205,000-187,000)/187,000 = 0.096 16 CNN Money, "How much House Can You Afford?" (accessed February 26,2013); available from http://cgi.money.cnn.com/tools/houseafford/houseafford.html 6
renter households paid 35 percent or more oftheir income for rent in 2011 17 (families who pay more than 30 percent of their income for housing are considered cost burdened and may have difficulty affording necessities such as food, clothing, transportation and medical care).18 Credit Needs Access to credit for businesses, particularly for small business owners, was a concern during the national recession. 19 According to national data reported under the CRA, both the number and dollar amount of small business loan originations reported in 2010 declined about nine percent from their respective amounts in 2009. 20 Yet, as stated by the October 2011 Federal Reserve Board's Senior Loan Officer Opinion Survey on Bank Lending Practices, in 2011 loan officers reported easing lending standards for small businesses, while leaving standards for residential real estate loans basically unchanged. 21 Despite this, banks in 2011 reported a decline in the demand for small business loans, while demand for residential mortgage loans increased. However, by the July 2012 Senior Loan Officer Opinion Survey, domestic banks reported an increase in the number of inquiries from potential business borrowers regarding new or increased credit lines, indicating a rising demand for credit nationwide. 22 Likewise, community contacts indicated that local credit needs include loans to small businesses, loans for startup capital, and grant funding for nonprofit organizations. As in many communities, small dollar business loans are also of need. As previously described, increasing home prices during the review period contributed to less housing affordability for low- and- moderate-income residents of SLC. The data regarding home price increases coupled with high rental costs has resulted in needs throughout the assessment area for affordable housing solutions, including but not limited to, lending programs. 17 U.S. Census Bureau, American Community Survey, 1 Year Estimates Selected Housing Characteristics DP04, 2011 Salt Lake County (accessed February 26,2013); available from http://www.factfinder.census.gov. 18 U.S. Department of Housing and Urban Development. Affordable Housing; (accessed February 26, 2013); available from http://www.hud.gov/offices/cpd/affordablehousing/ 19 The American Banker, February 8, 2010, Agencies Urge Loans to Small Businesses. 20 FFIEC (2011),"Findings from Analysis of Nationwide Summary Statistics for 2010 Community Reinvestment Act Data Fact Sheet (August 2011)," (accessed February 26, 2013); available from http://www.ffiec.gov/hmcrpr/cra_fs11.htm. 21 Board of Governors of the Federal Reserve System, The October 2011 Senior Loan Officer Opinion Survey on Bank Lending Practices, October 2011, page 1 (accessed February 26, 2013); available from http://www.federalreserve.gov/boarddocs/snloansurvey/. 22 Board of Governors of the Federal Reserve System, The July 2012 Senior Loan Officer Opinion Survey on Bank Lending Practices (accessed February 4,2013); available from http://www.federalreserve.gov/boarddocs/snloansurvey/201208/default.htm. 7
Scope of Examination The CRA examination of FUB was conducted using the Interagency Small Bank CRA Examination Procedures. The evaluation was based on the following performance criteria: Loan volume compared to deposits (Loan-to-Deposit Ratio); Lending inside versus outside the assessment area (Lending in Assessment Area); Dispersion of lending throughout the assessment area (Lending Distribution by Geography); and Lending to businesses of different revenue sizes (Lending Distribution by Business Revenue). Responsiveness to consumer complaints was not evaluated because the bank did not receive any CRArelated complaints during the review period. The evaluation was based on small business loans originated between January 1, 2011, and December 31, 2012. A total of 207 small business loans were used in the evaluation of Lending in the Assessment Area. A sample of 89 small business loans extended within the assessment area was used in the evaluation of Lending Distribution by Geography and Lending Distribution by Business Revenue. Home mortgage loans were considered but did not influence the overall assessment due to the limited volume of loans extended during the review period. 8
CONCLUSIONS WITH RESPECT TO PERFORMANCE CRITERIA Loan-to-Deposit Ratio The loan-to-deposit ratio is reasonable. Since the previous CRA examination conducted on February 28, 2011, the average loan-to-deposit ratio is 67.8 percent. This number is lower than both the state average of 80.1 percent and national peer average of 73.4 percent. Yet, the bank's loan-to-deposit ratio is generally consistent with local peer averages. Further, the bank sells a number of loans on the secondary market which impacts it loan to deposit ratio. Lending in Assessment Area The bank's lending in the assessment area is excellent. A substantial majority of small business loans were originated inside the bank's assessment area. As shown in Exhibit 5, the bank extended approximately 90 percent of loans by both number and dollar volume inside the assessment area. EXHIBITS LENDING INSIDE AND OUTSIDE THE ASSESSMENT AREA JANUARY 1, 2011 TO DECEMBER 31, 2012 Inside Outside Loan Type $ $ # % % # % % ('0005) ('0005) Small Business 186 89.9 47,240 91.6 21 10.1 4,346 8.4 Lending Distribution by Geography Overall, the geographic distribution of small business loans demonstrates a reasonable dispersion of small business loans throughout the bank's assessment area. Generally, small business loans were made in close proximity to the areas surrounding the bank's eight branches and there were no conspicuous gaps in lending patterns. As shown in Exhibit 6, on the following page, in 2011, small business loans were extended within census tracts of all income categories, with lending levels generally comparable to business concentrations and aggregate lending levels. Notably, lending in low-income census tracts more than doubled the level of such businesses in 2011 but fell to zero in 2012. These lending patterns can be explained by performance context factors. Between 2011 and 2012, the bank's small business lending dispersion generally occurred in the same census tracts, often in close proximity to its branches. However, following the 2010 U.s. Census the substantial majority of lowincome census tracts in the assessment area had changed. Notably, a large census tract near FUB's Centennial Park Branch changed from low-income to middle-income and census tracts near FUB's International Branch changed from low-income to moderate-income. Conversely, the new low-income 9
census tracts are not in close proximity to the bank's branches. Based on the bank's branch locations, it is reasonable that such a change in the location of low-income census tracts would result in a decreased level of lending in these census tracts. EXHIBIT 6 GEOGRAPHIC DISTRIBUTION OF SMALL BUSINESS LOANS Census Tract Low Moderate Middle Upper # % # % # % # % 2011 Bank Lending 7 18.9 10 27.0 9 24.3 11 29.7 Aggregate Lending 3,780 8.1 12,608 21.0 25,986 38.7 19,691 32.2 Business Concentration 1,853 6.1 4,827 20.3 8,881 41.9 7,376 31.7 2012 23 Bank Lending 0.0 0.0 17 34.0 23 46.0 10 20.0 Lending Distribution by Business Revenue The bank has an overall poor record of lending to small businesses, defined as those with gross annual revenues of $1 million or less. Performance was mixed during the two-year review period. As shown in Exhibit 7, the bank's level of lending in 2011, to small businesses, was just under 50 percent while the number of smaller dollar loans (i.e., those under $100,000) was somewhat low at just under 30 percent. Conversely, in 2012, the bank made only one quarter of its loans to small businesses while almost half of these loans were in amounts less than $100,000. These lower lending levels occurring at times when demand was increasing could not be otherwise explained by the performance context. EXHIBIT 7 BUSINESS REVENUE DISTRIBUTION OF SMALL BUSINESS LOANS Lending to Businesses with Revenue Originations Regardless of Revenue Size <=$1 Million by Loan Amount Bank Year Businesses Lending # Bank Aggregate <=$100K >$100K & >250K & <=$1M in Lending (%) Lending (%) (%) <=$250K (%) <=$1M (%) Revenue (%) 2011 37 45.9 90.1 41.3 29.7 27.0 43.2 2012 52 26.9 - - 46.2 26.9 26.9 Response to Complaints FUB did not receive any complaints related to CRA during the review period. Consequently, the bank's performance in responding to complaints was not considered in evaluating CRA performance. 23 Aggregate lending and business concentration data not yet available for 2012. 10
Fair Lending or Other Illegal Practices Review A review of the bank's compliance with consumer protection laws and regulations was conducted concurrent with this era evaluation and did not result in the identification of any violations of the substantive provisions of anti-discrimination, fair lending, or other illegal credit practice rules, laws or regulations that were inconsistent with helping to meet community credit needs. 11
FIrst Utah Bank Salt Lake CIty, Utah CRA Public EvaluatIon GLOSSARY OF TERMS Aggregate lending: The number of loans originated and purchased by all reporting lenders in specified income categories as a percentage of the aggregate number of loans originated and purchased by all reporting lenders in the metropolitan area/assessment area. Census tract: A small subdivision of metropolitan and other densely populated counties. Census tract boundaries do not cross county lines; however, they may cross the boundaries of metropolitan statistical areas. Census tracts usually have between 2,500 and 8,000 persons, and their physical size varies widely depending upon population density. Census tracts are designed to be homogeneous with respect to population characteristics, economic status, and living conditions to allow for statistical comparisons. Community development: All Agencies have adopted the following language. Affordable housing (including multifamily rental housing) for low- or moderate-income individuals; community services targeted to low- or moderate-income individuals; activities that promote economic development by financing businesses or farms that meet the size eligibility standards of the Small Business Administration's Development Company or Small Business Investment Company programs (13 CFR 121.301) or have gross annual revenues of $1 million or less; or, activities that revitalize or stabilize lowor moderate-income geographies. Effective September 1, 2005, the Board of Governors of the Federal Reserve System, Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation have adopted the following additional language as part of the revitalize or stabilize definition of community development. Activities that revitalize or stabilize: (i) Low- or moderate-income geographies; (ii) Designated disaster areas; or (iii) Distressed or underserved nonmetropolitan middle-income geographies designated by the Board, Federal Deposit Insurance Corporation, and Office of the Comptroller of the Currency, based on: a. Rates of poverty, unemployment, and population loss; or b. Population size, density, and dispersion. Activities that revitalize and stabilize geographies designated based on population size, density, and dispersion if they help to meet essential community needs, including needs of low- and moderate-income individuals. Consumer loan(s): A loan(s) to one or more individuals for household, family, or other personal expenditures. A consumer loan does not include a home mortgage, small business, or small farm loan. This definition includes the following categories: motor vehicle loans, credit card loans, home equity loans, other secured consumer loans, and other unsecured consumer loans. Family: Includes a householder and one or more other persons living in the same household who are related to the householder by birth, marriage, or adoption. The number of family households always equals the number of families; however, a family household may also include non-relatives living with the family. Families are classified by type as either a married-couple family or other family, which is further classified into 'male householder' (a family with a male householder and no wife present) or 'female householder' (a family with a female householder and no husband present). 12
Full-scope review: Performance under the lending and community development tests is analyzed considering performance context, quantitative factors (for example, geographic distribution, borrower distribution, and total number and dollar amount of investments), and qualitative factors (for example, responsiveness). Geography: A census tract delineated by the United States Bureau of the Census in the most recent decennial census. Home Mortgage Disclosure Act (HMDA): The statute that requires certain mortgage lenders that do business or have banking offices in a metropolitan statistical area to file annual summary reports of their mortgage lending activity. The reports include such data as the race, gender, and the income of applications, the amount of loan requested, and the disposition of the application (for example, approved, denied, and withdrawn). Home mortgage loans: Includes home purchase and home improvement loans as defined in the HMDA regulation. This definition also includes multifamily (five or more families) dwelling loans, loans for the purchase of manufactured homes and refinancings of home improvement and home purchase loans. Household: Includes all persons occupying a housing unit. Persons not living in households are classified as living in group quarters. In 100 percent tabulations, the count of households always equals the count of occupied housing units. Limited-scope review: Performance under the lending and community development tests is analyzed using only quantitative factors (for example, geographic distribution, borrower distribution, total number and dollar amount of investments, and branch distribution). Low-income: Individual income that is less than 50 percent of the area median income, or a median family income that is less than 50 percent, in the case of a geography. Market share: The number of loans originated and purchased by the institution as a percentage of the aggregate number of loans originated and purchased by all reporting lenders in the metropolitan area/assessment area. Metropolitan area (MA): A metropolitan statistical area (MSA) or a metropolitan division (MD) as defined by the Office of Management and Budget. A MSA is a core area containing at least one urbanized area of 50,000 or more inhabitants, together with adjacent communities having a high degree of economic and social integration with that core. A MD is a division of a MSA based on specific criteria including commuting patterns. Only a MSA that has a population of at least 2.5 million may be divided into MDs. Middle-income: Individual income that is at least 80 percent and less than 120 percent of the area median income, or a median family income that is at least 80 percent and less than 120 percent, in the case of a geography. Moderate-income: Individual income that is at least 50 percent and less than 80 percent of the area median income, or a median family income that is at least 50 percent and less than 80 percent, in the case of a geography. 13
Multifamily: Refers to a residential structure that contains five or more units. Other products: Includes any unreported optional category of loans for which the institution collects and maintains data for consideration during a CRA examination. Examples of such activity include consumer loans and other loan data an institution may provide concerning its lending performance. Owner-occupied units: Includes units occupied by the owner or co-owner, even if the unit has not been fully paid for or is mortgaged. Qualified investment: A qualified investment is defined as any lawful investment, deposit, membership share, or grant that has as its primary purpose community development. Rated area: A rated area is a state or multistate metropolitan area. For an institution with domestic branches in only one state, the institution's CRA rating would be the state rating. If an institution maintains domestic branches in more than one state, the institution will receive a rating for each state in which those branches are located. If an institution maintains domestic branches in two or more states within a multistate metropolitan area, the institution will receive a rating for the multistate metropolitan area. Small loan(s) to business(es): A loan included in 'loans to small businesses' as defined in the Consolidated Report of Condition and Income (Call Report) and the Thrift Financial Reporting (TFR) instructions. These loans have original amounts of $1 million or less and typically are either secured by nonfarm or nonresidential real estate or are classified as commercial and industrial loans. However, thrift institutions may also exercise the option to report loans secured by nonfarm residential real estate as "small business loans" if the loans are reported on the TFR as nonmortgage, commercial loans. Small loan(s) to farm(s): A loan included in 'loans to small farms' as defined in the instructions for preparation of the Consolidated Report of Condition and Income (Call Report). These loans have original amounts of $500,000 or less and are either secured by farmland, or are classified as loans to finance agricultural production and other loans to farmers. Upper-income: Individual income that is more than 120 percent ofthe area median income, or a median family income that is more than 120 percent, in the case of a geography. 14