WASHINGTON- The OCC has issued its final CRA rule just six weeks after the end of the comment period on the Notice of Proposed Rulemaking (NPR) and amid the worst health and economic crisis of our lifetimes. Banks, regulators and community groups must be singularly focused on responding to this unprecedented crisis, and not on bureaucratic and regulatory diversions that will sidetrack essential resources from the task at hand.
As NHC stated in its formal comment letter on the CRA NPR on April 8, “we have no idea how severely the pandemic will impact our economy, the financial system and communities throughout the nation. Committing resources to regulatory initiatives that do not directly support our national response to the COVID-19 pandemic is a dangerous distraction.”
On April 27, NHC joined 14 other major national organizations, including the National Association of REALTORS and the National League of Cities, to urge regulators to refrain from “committing resources to regulatory initiatives that do not directly support our national response to the COVID-19 pandemic.”
Notably, the Federal Deposit Insurance Corporation (FDIC) has refused to join the OCC on this ill-timed decision. As FDIC Chairman Jelena McWilliams noted in her March 19, 2020 letter to the Financial Accounting Standards Board, financial institutions “will face unique difficulties over the coming weeks and months to adequately staff customer-facing functions; ensure that deposit, loan, and IT systems operate normally; help borrowers that are experiencing unanticipated cash flow difficulties; and address the earnings and capital implications of near zero percent interest rates and a potential surge in borrowers who are unable to meet contractual payment terms.” We could not agree more.
NHC will conduct a thorough review of the final rule. While some constructive changes have been made to the proposed rule, the fundamental basis of our objections remain intact as the final rule demonstrably guts the purpose and intent of the CRA. In many ways, the rule reduces the clarity and consistency that served as the impetus to modernize CRA in the first place.
About NHC: The National Housing Conference has been defending the American Home since 1931. Everyone in America should have equal opportunity to live in a quality, affordable home in a thriving community. NHC convenes and collaborates with our diverse membership and the broader housing and community development sectors to advance our policy, research and communications initiatives to effect positive change at the federal, state and local levels. Politically diverse and nonpartisan, NHC is a 501(c)3 nonprofit organization.