American Banker, October 25, 2023, Community Reinvestment Act Rule Finally Crosses The Finish Line
The Board of Governors of the Federal Reserve System voted to issue a final rule revamping the Community Reinvestment Act Tuesday morning, redefining the criteria for small, intermediate and large banks; introducing new evaluation tests based on loan activity rather than branch location; and incentivizing banks to conduct more community development activities
Community group leaders like Jesse Van Tol, CEO and president of the National Community Reinvestment Coalition, praised the final rule, saying that persistent inequalities in bank lending and services justify the changes outlined in the rule.
“This update is both long overdue and essential,” Van Tol said in a release. “Marginalized communities still suffer from a variety of inequities in mortgage and small-business lending, and from the enduring effects of historic financial discrimination [and] CRA is one of the most powerful and important tools the government has to ensure that banks meet the credit needs of all Americans and in all communities.”