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American Banker: Fed’s Powell sees opportunity for joint CRA overhaul

American Banker, February 24, 2021, Fed’s Powell sees opportunity for joint CRA overhaul

Federal Reserve Chair Jerome Powell said bank regulators are still aiming to write a joint rule reforming the Community Reinvestment Act, despite years of disagreements between the agencies on how to proceed.

The Office of the Comptroller of the Currency finalized a rule on its own in May that includes a new CRA scoring method and other reforms, but the Fed and other agencies declined to support the plan. However, a leadership change has buoyed hopes of an interagency framework.

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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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