WASHINGTON-The clothes and hair were not quite right but the message is the same. Federal Reserve Board Chairman Alan Greenspan sounded very similar to NCUA Board Member Debbie Matz during remarks he gave at the 2005 National Community Reinvestment Coalition Conference March 18. He noted that in a couple years, the Community Reinvestment Act will be celebrating its 30th birthday. "To date, this act has brought many successes, but much remains to be accomplished. Before passage of the CRA, lending to underserved populations was often considered an act of goodwill, not good business. I do not disparage benevolence, but I believe that one of the most enduring achievements of the CRA has been that lenders, often to their surprise, have found low-income community lending to be a normal extension of their outreach for profitable business." He went on to state, "Because it is critical that low- and moderate-income lending be, and be perceived as, an extension of regular business practice, we have been building a substantial database on low-income credit experience and business opportunities. This information has been critical to the successes in low-income lending. But information collection and analysis must reach further. If communities are going to be empowered, they need hard evidence of their successes and, yes, hard evidence of their failures, which, as you know, can point the way toward success." At this point, Greenspan said, "systematic research on community economic development programs has been limited." However, he also pointed out that measuring these types of programs can be "quite difficult" and complex. He concluded, "In the quest to do good for our society's most-vulnerable populations and communities – the objective compelling the work of this group – analysts must embrace the challenge to develop objective and quantifiable standards for assessing community development programs. Ultimately, research is the only means for determining whether we are making advances in distressed neighborhoods by improving access to economic opportunities for traditionally underserved populations." The Fed chairman's comments came less than a month after the three banking regulatory agencies issued a joint notice of proposed rulemaking to lighten the load of CRA reporting on smaller banks. The Office of Thrift Supervision put out its own notice that went even further. The for-profit depository institutions have argued for years that credit unions should be subject to CRA, though credit unions have successfully fought it off thus far by spreading the word of their good deeds. -
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more inforrmation visit Asset & Logo Licensing.