Group of 30 Organizations Committed to Inclusive Economic Growth Write in Support of Strengthened CRA

The U.S. Impact Investing Alliance, along with 29 organizations, representing businesses, investors, community lenders and advocates, and aligned around the principles of inclusive economic growth, submitted a letter in support of the Office of the Comptroller of the Currency’s (OCC) proposal to rescind June 2020 changes to Community Reinvestment Act (CRA) regulations that would – if fully implemented – significantly weaken the policy. The signatories applauded the OCC’s decision to pursue a cohesive set of reforms that will modernize and strengthen the CRA alongside its peer regulating agencies - the Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve.

The CRA is a key policy tool for flowing private capital to communities underserved by the banking industry, stemming from efforts to reverse decades of racist redlining practices and disinvestment from Black and low-income communities. The OCC’s decision last year to move forward with rulemaking without the support of the FDIC and Federal Reserve created confusion and jeopardized the policy’s capacity to spur adequate investments in line with its core purpose.

The letter encourages policymakers, when working to modernize the CRA, to consider the following: 1) CRA reform should acknowledge the historical imperative of the CRA to address racial inequality in access to credit and the lasting impact redlining has had on communities; 2) CRA reform should catalyze robust investments in community lenders and small business ecosystems; and 3) CRA reform should reflect developments in the modern lending market, and policymakers should consider expanded coverage to include non-bank financial lenders.

The Alliance also submitted an individual letter expressing support for the OCC’s proposal and decision to align with the other rulemaking agencies.

The Alliance looks forward to continued engagement with regulators and peers in the private sector to ensure reform efforts reaffirm the CRA’s importance as the bedrock of the community development finance landscape in the United States.