National CAPACD Applauds New Final Rule for Community Reinvestment Act

The National Coalition for Asian Pacific American Community Development (National CAPACD) applauds the recently released final rule for the Community Reinvestment Act (CRA). While the rule doesn’t go far enough to tackle racial inequities directly, this comprehensive reform represents a significant milestone in promoting economic development, financial inclusion, and community revitalization across our diverse and vibrant Asian American, Native Hawaiian, and Pacific Islander (AA and NHPI) communities and modernizes the CRA to current technologies and innovations in banking. National CAPACD submitted comments to the proposed rule, and the improvements in the final rule align with National CAPACD’s mission to advance equity and create vibrant, healthy neighborhoods by mobilizing and strengthening a powerful coalition of AA and NHPI community-based organizations working in low-income communities.

The Community Reinvestment Act is a landmark piece of legislation enacted in 1977 to combat discrimination in the lending industry. Despite this, there are still significant barriers to accessing quality products and services for low- and middle-income (LMI) communities of color. The CRA rule developed by the Federal Reserve (Fed), Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC), has long been a cornerstone of our nation’s financial regulatory framework, designed to ensure that banks meet the credit needs of all communities, including underserved and low-to-moderate-income neighborhoods. As a community-based organization committed to empowering and enhancing the quality of life for our AA and NHPI communities, we are thrilled to see this stronger CRA rule come to fruition.

National CAPACD commends the regulatory agencies for their dedication to refining and modernizing the CRA to better address the contemporary needs and challenges faced by low- and moderate-income communities of color. This groundbreaking and long-awaited final rule demonstrates a clear commitment to the principles of fairness, equity, and inclusivity at the core of the CRA’s mission.

We are pleased to see provisions in the rule that would increase accountability to lending to communities of color by reinforcing HMDA data collection and reporting requirements for large banks. We are also happy to see increased efforts for community engagements and to improve communication between the community and banks. These efforts include additional processes through which the public can provide input on community credit needs, including opportunities in connection with a bank’s next scheduled CRA examination. To facilitate these opportunities for the community, the agencies plan to publish a list of banks scheduled for CRA examinations. National CAPACD believes that these changes will create new opportunities for AA and NHPI communities across the country to access financial services, obtain loans for small businesses, and secure affordable housing. We hope to work with the regulators to ensure that racial equity and language access continue to be a priority in the implementation of the rule.

We look forward to continuing our collaboration with our members, regulatory agencies, and other community-based organizations to ensure the successful implementation of this final rule. Together, we can advance economic development, financial inclusion, and the well-being of all community members.