February 16, 2021
Statement by Superintendent of Financial Services Linda A. Lacewell on the Federal Reserve Board’s Advance Notice of Proposed Rulemaking (ANPR) for the Community Reinvestment Act (CRA):
“The federal and New York Community Reinvestment Acts encourage banks to meet the credit needs of their communities, including low- and moderate-income (LMI) areas. Both laws were adopted in response to concerns about the redlining of poor and minority communities by banking institutions during the 1960s and 1970s. There is still more to do. NYDFS recently issued a report that found historic redlining practices in Buffalo, New York, have had a significant, persistent and continuing negative impact on credit access in LMI communities.
I applaud the Federal Reserve Board (FRB) for the proposals in the ANPR, which on the whole reflect developments in the current banking environment and provide greater transparency and clarity, while continuing to focus on the needs of LMI communities. We encourage the FRB to strongly consider our recommended revisions, particularly in light of the Department of Financial Services’ experience in administering the New York CRA. We await the FRB’s further rulemaking and urge all federal regulators to take a similar approach to updating the CRA. As we face the ongoing the public health crisis, and the resulting economic crisis, an effective CRA that remains focused on the credit needs of underserved communities is more important than ever.”