Proposed Changes to CRA Puts Billions in Lending at Risk Each Year

Nearly $3 trillion in home and small business loans from banks went to low- and moderate-income (LMI) borrowers and communities over the last decade. Proposed changes to the Community Reinvestment Act (CRA), which requires banks to make loans in all of the communities where they take deposits, including poor ones, could significantly decrease this lending, putting at risk billions in lending each year nationwide.

An NCRC analysis of lending data reported by banks showed banks issued more than $2.2 trillion in home loans and more than $564 billion small business loans to LMI borrowers and communities from 2009 through 2018.

The proposed changes to CRA rules, from the Office of the Comptroller of the Currency (OCC) and Federal Deposit Insurance Company (FDIC), would allow banks to fail their CRA exams in nearly half of the geographical areas in which they are examined. Common sense, supported by Federal Reserve research, suggests that lending in some communities would decrease. Banks could choose to concentrate their lending in some places and ignore others – potentially nearly half of the communities where current rules now require them to make loans. Moreover, the exams would feature a single metric (CRA activities divided by deposits) that would motivate banks to favor large deals, including sports stadiums, over small dollar home and small business lending.

See what is at risk in your community with this tool. Include these findings in a comment letter about the proposed rules. Submit your comment by March 9, 2020. Visit Treasure CRA for more details about how to comment.



This research considered loans with low or moderate income (LMI) borrowers or in LMI census tracts to be CRA qualified.  In addition, business loans to businesses that earned less than $1 million a year received CRA credit. There is an unknown degree of overlap between business loans that are both in an LMI tract and to a small business so we have kept them as separate figures for this analysis. All dollars are adjusted for inflation to January 2018 values. https://data.bls.gov/cgi-bin/cpicalc.pl .

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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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