Washington, D.C. – In a letter to the Chairman of the Federal Reserve Board of Governors, Jerome Powell; The Comptroller of the Currency, Joseph Otting; and the Chairman of the Federal Deposit Insurance Corporation, Jelena McWilliams; CFA and other consumer groups expressed their views on two critical issues essential to the success of modernizing the Community Reinvestment Act (CRA).
In its distinguished 42 year-long history, the CRA has successfully encouraged banks to serve communities-of-need, influenced where and how mortgages and loans are made, and how banks and communities work together. A properly designed regulatory framework will serve both communities and banks well for the next decade or longer. A fragmented and poorly designed framework would be disruptive to banks and communities and would likely be revisited after only a short time.
In their letter, the consumer groups stressed the importance that the three prudential banking agencies issue uniform CRA regulations and that metrics for CRA activity should be workable, flexible, robust, and address community needs. While the letter highlighted a number of concerns the groups have regarding the effort to modernize the CRA, the groups also praised the effort to modernize the regulation stating that “[it] is worth doing right, even if it requires compromise among the agencies and takes longer than many of us would wish. We look forward to working with all of you to make this potentially historic initiative a success for banks, advocates, regulators and most importantly, the communities that we all serve.”