As part of the American Bankers Association’s long-term engagement with the Treasury Department and financial regulators on the Community Reinvestment Act, the association today sent a white paper to Treasury with several recommendations for modernizing the regulatory approach to CRA. The recommendations come as Treasury staff are preparing their own report on CRA reform at the request of Secretary Steven Mnuchin; ABA staff have met with Treasury officials to provide input as part of this process.
The recommendations — developed by a working group of bank leaders — reflect the banking industry’s CRA principles of community commitment, economic growth, transparency, predictability, consistency and simplicity. Most if not all of them can be accomplished by regulatory action through exam procedures, guidance and interagency questions and answers.
Specifically, ABA urged Treasury and financial regulators to align CRA resources with actual community needs; reflect changes in technology, consumer preferences and the business of banking; increase transparency and certainty about regulatory interpretations and standards; improve the supervisory process; and apply CRA-style requirements to similarly situated financial firms, including credit unions and fintech companies. For more information, contact ABA’s Krista Shonk.