Washington, D.C. - Washington, DC - Today, Congressman Andy Barr (KY-06) released the following statement on the Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corporation (FDIC), and Federal Reserve Board's Final Rule on Community Reinvestment Act (CRA) Regulations.
“While I support the intent of the CRA to eliminate redlining and encourage financial institutions to invest in the areas in which they do business, the rule voted on today is under analyzed, not forward-looking, and will only lock in the status quo. By micromanaging how banks should operate, it runs a high risk of reducing credit availability to underserved communities and harms the customers and communities that the CRA was intended to protect. The anti-consumer rule creates a new definition of what constitutes a “large” bank, with unexamined and likely negative consequences. Unfortunately, to the detriment of consumers and underserved communities, Federal banking agencies are increasingly abandoning analysis of their proposals and rules, rolling the dice on unintended consequences, and further opening the doors for partisan credit channeling.
The CRA was not intended to be a tool for activists to channel credit and investments to progressive causes. Sadly, today’s CRA rule may be abused by activists and politically unaccountable regulators.
My Republican colleagues and I have long called for modernization of the CRA regulations – something that hasn’t been done meaningfully since 1995 – including increasing consistency, clarity, and objectivity in assessments. Unfortunately, the rule federal banking regulators promulgated sticks to the outdated, existing state of affairs.”