Better Markets Applauds OCC Proposal to rescind its seriously flawed 2020 cRA Rule

Better Markets, November 1, 2021, Better Markets Applauds OCC Proposal To Rescind Its Seriously Flawed 2020 CRA Rule

Phillip Basil, Director of Banking Policy at Better Markets, issued the following statement:

“Better Markets has submitted a comment letter in full support of the Office of the Comptroller of the Currency’s (OCC) proposal to rescind its seriously flawed 2020 rule regarding the Community Reinvestment Act (CRA). We also joined the letters of the National Community Reinvestment Coalition and the U.S. Impact Investing Alliance.”

“The CRA requires the federal banking regulatory agencies to ensure the banks they supervise and regulate are serving the banking needs of the low-to-moderate income (LMI) communities in which they do business. The OCC’s 2020 rule was finalized without the participation of the other banking agencies—the Federal Reserve and the Federal Deposit Insurance corporation—and had numerous flaws. The senseless provisions of the rule have the effect of incentivizing banks to engage in activities that have a lower substantive impact on and divert financial activities away from LMI communities.”

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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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