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September 2004
Mr.
Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit
Insurance Corporation
550 17th St. NW
Washington, DC 20429
RE: RIN 3064-AC50
Dear Mr. Feldman:
I am a concerned citizen opposed to watering down CRA (Community
Reinvestment Act) requirements for mid-sized banks. CRA is vital
for increasing homeownership and economic development in lower-income
communities. However, your proposed changes will halt the progress
that has been made.
I understand that banks with over $250 million in assets must be
tested on their number of loans, investments, and services to low-
and moderate-income communities. But your proposal would eliminate
the investment and service requirements for all banks with under
$1 billion in assets. This will result in significantly fewer loans
and investments in affordable rental housing, health clinics, community
centers, and economic development projects.
In the watered-down
exam, you would allow mid-sized banks to choose which community
development activities they will undertake. Right
now, these banks must make community development loans, investments,
and services. Your proposed test allows banks to choose only one
of the three activities. The result will be less community development
activity.
You also propose that community development activities in rural
areas should benefit any group of individuals instead of only low-
and moderate-income individuals. But this will allow banks to cherry
pick and focus on affluent residents of rural areas rather than the
lower income consumers CRA targets. Finally, you would also eliminate
publicly available data on the small business lending of mid-sized
banks. Without data, community groups and citizens cannot hold banks
accountable for lending to small businesses in their neighborhoods.
Your changes directly oppose CRA's mandate to require lenders to
meet community needs. CRA is too important to be gutted. Please drop
your proposal like the two other federal agencies that recognized
its harm to underserved communities.
Sincerely,
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