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Federal Register Publications

FDIC Federal Register Citations



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FDIC Federal Register Citations

AFFORDABLE HOUSING CLEARINGHOUSE

September 16, 2004

Robert E. Feldman
Executive Secretary
Attn: Comments/Legal ESS
Federal Deposit Insurance Corporation
550 17th Street NW
Washington, DC 20429

Re: CRA Regulation Changes

Dear Mr. Feldman:
The Affordable Housing Clearinghouse wishes to submit commentary on the proposed changes of the Community Reinvestment Act.

The Affordable Housing Clearinghouse (AHC) is a network of financial institutions, community organizations, and local government agencies dedicated to the financing and development of quality affordable housing in a five-county area in California: Los Angeles, Orange, Riverside, San Diego, and San Bernardino counties. AHC has been organized as a nonprofit organization since 1991. With the collaboration of our 30 lender members, which include large, medium and small financial institutions from all of our regions, we have helped to finance over 250 units of affordable ownership housing and over 800 units of affordable rental or special needs housing.

We face many challenges in meeting the housing and financial needs in our high-cost and highly populated region. AHC firmly believes that the Community Reinvestment Act has helped increase homeownership, expand economic opportunity, and expand access to financial services and resources in low-income communities. However, many communities are still underserved by financial institutions. The proposed CRA changes would reduce lending, investment, and service in low-income communities.

Under the current CRA regulations, banks with assets of at least $250 million are rated and evaluated based on their demonstrated performance in providing lending, investment, and services to low- and moderate-income communities. The proposed changes would eliminate the investment and service components of the CRA exam for state-chartered banks with assets between $250 million and $1 billion. In place of the investment and service parts of the CRA exam, the FDIC proposes to add a community development criterion. The community development criterion would require mid-size banks with assets between $250 million and $1 billion to engage in only one of three activities: community development lending, investing or services. Currently, mid-size banks must engage in all three activities.

In addition, the FDIC's proposal would eliminate the small business lending data reporting requirement for mid-size banks. Mid-size banks with assets between $250 million and $1 billion would no longer be required to report small business lending by census tracts or revenue size of the small business borrowers.

State-chartered and mid-sized banks play an important role in meeting the financial needs of local communities. We urge you to maintain the current standard of evaluation for these banks, which examines demonstrated performance in all three areas: lending, investment, and services, as well as reporting of small business lending by census tracts and revenue size of the borrowers. Thank you in advance for considering our remarks.

Sincerely,
Trinh LeCong EXECUTIVE DIRECTOR
Affordable Housing Clearinghouse
Lake Forest, CA

Last Updated 10/18/2004 regs@fdic.gov

Last Updated: August 4, 2024