American Banker: BankThink Grading Treasury’s CRA reform memo: ‘Incomplete’

American Banker, April 12, 2018: BankThink Grading Treasury’s CRA reform memo: ‘Incomplete’

The Treasury Department’s long-awaited memo on reforming the Community Reinvestment Act was long on glittering generalities but sadly short on specifics, which probably explains why the report punted the real job of making reforms to the regulators. Putting on my “CRA Professor” hat, I would grade their effort as “Incomplete.”

While the Treasury addressed several important issues, these are the top five critical omissions from its CRA reform playbook:

  • CRA requirement for credit unions
  • Consolidation of CRA regulatory oversight in one agency
  • Economic incentives for earning an Outstanding CRA rating
  • Specific quantitative guidelines on key CRA metrics
  • Specific assessment area recommendations for nationwide banks

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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