Economic justice leaders urge strengthening of the Community Reinvestment Act during Treasury Department review 

Media Advisory

Washington DC – The National Community Reinvestment Coalition, joined by almost 500 national and local organizations, today sent a set of recommendations to Treasury Secretary Steve Mnuchin and Comptroller of the Currency Joseph M. Otting to strengthen the Community Reinvestment Act, a landmark civil rights law designed to stop discrimination in banking and housing. The 1977 law requires banks to serve the credit and banking needs of the communities where they are chartered – by federal agencies – to do business.

In its letter to Mnuchin and Otting, sent in anticipation of plans from both Treasury and OCC to reform the law, NCRC recommended changes to strengthen and modernize CRA without weakening it.

“The Community Reinvestment Act is an invaluable legal tool for expanding access to safe banking services in underserved communities,” said John Taylor, President & CEO of the National Community Reinvestment Coalition. “It is imperative that Treasury and OCC modernize the Act with their regulatory reforms, and ensure it functions properly for all communities.”

Among other things, the letter recommended expansion of CRA to cover credit unions, mortgage companies, financial technology companies, and other lenders, and standardizing CRA exams that are now conducted by three different agencies.

The letter expressed deep concern that Treasury will follow in the footsteps of the OCC, which has eased enforcement of fair lending rules.

“The fair lending review is an essential and non-negotiable part of CRA enforcement,” Taylor said.

The letter said the groups that signed it will only accept changes to the Community Reinvestment Act that increase lending and investment in underserved neighborhoods. The letter included several recommendations to strengthen and modernize the CRA:

Expand CRA to all non-banks: To reflect today’s financial landscape, CRA compliance should be expanded to all non-banks, including credit unions, fintechs, mortgage companies, investment, and others.  A broader CRA would level the playing field for traditional banks, and require all financial institutions provide consistently safe financial products.

Geographical Assessment Areas: Assessment areas should define CRA accountability where the majority of branch lending occurs, but also where the majority of non-branch lending. This change responds to the revolution of traditional banking to online platforms, and entirely online financial technologies called fintechs.

Examination Process: Currently, three federal regulators conduct CRA exams using their own performance measures and ratios. The examination process should be strengthened, updated and standardized across all three regulators.

Fair lending review: We wholeheartedly agree with banks that keeping a timely CRA process is necessary. We suggest publishing CRA exams with the understanding that if a fair lending exam detects a violation after a bank has been graded they may be subjected to a retroactive downgrade.

The full letter can be viewed here.

For media inquiries please contact:

Jesse Meisenhelter


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