WASHINGTON, D.C.— Dennis Kelleher, President, CEO, and Co-founder, issued the following statement in response to yet another Friday announcement by the Federal Reserve, FDIC, and OCC (‘Banking Agencies’), this time to withdraw the rule that modernized the 1977 Community Reinvestment Act (CRA).
“Working Americans have been hammered by inflation, income stagnation, wealth deprivation, and an economy rigged against them no matter how hard they work. Now the Banking Agencies have decided to add to that misery by withdrawing a recent rule that modernized the 1977 CRA, which requires banks to invest in America’s communities. That investment is focused on low- and moderate-income families and communities that have been illegally denied credit, investment, and banking services for decades. That egregious conduct contributed significantly to intergenerational wealth gaps, poverty, and a debilitating lack of hope. It literally robbed Americans of the American Dream. While the CRA rule wasn’t perfect, it still resulted in critical investments in many communities and provided some protection for low- and moderate-income families against discrimination by banks.
“Adding insult to injury, the Banking Agencies didn’t even bother justifying their decision to kill this rule and cavalierly trashed many years of deliberation, input, and work. Instead, the Banking Agencies merely stated they were taking this action ‘in light of pending litigation,’ as if the merits of the law, rule and process were irrelevant. Utterly ignoring the importance of the CRA to so many communities across America or the fact that the CRA is vital to protecting the most vulnerable Americans from redlining and discrimination by banks is indefensible and wouldn’t withstand scrutiny in the light of day. The Banking Agencies undoubtedly know this, which is presumably why they yet again made an announcement on a Friday afternoon, hoping it’ll receive minimal media coverage due to the weekend news hole.
“As if that wasn’t enough, today’s action again showed that the Banking Agencies, which claim nonstop they are non-political and independent, are willingly bending to the Administration’s political agenda. A quick juxtaposition of actions since January 20th with the slow walking to nonexistent actions at the Federal Reserve in particular during the prior four years clearly reveals Fed Chair Powell’s political and ideological bias. Many of America’s hardworking communities and tens of millions of low- and moderate-income Americans rely on the Banking Agencies to protect them and today’s action is another knife in the back.”
###
Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.
