Date: September 16, 2004
Mr. Robert E. Feldman
Executive Secretary
Attention: Comments/Legal ESS
Federal Deposit Insurance Corporation
550
17th St., NW
Washington, DC 20429
RE: RIN 3064-AC50
Dear Mr. Feldman:
As a member of the National Community Reinvestment Coalition, NEDCO
urges you to withdraw your proposed changes to the Community
Reinvestment Act (CRA) regulations. CRA has been instrumental in
increasing homeownership, boosting economic development, and expanding
small businesses in the nation's minority, immigrant, and low- and
moderate-income communities. The proposed changes are contrary to the
CRA statute and Congress' Intent because they will slow down, if not
halt, the progress made in community reinvestment.
I want to emphasize one part of the proposal, the proposed
elimination of the small business lending data reporting requirement for
mid-size banks. We believe this to be Is III-advised. Mid-size banks
with assets between $250 million and $1 billion would no longer be
required to report small business lending by census tracts or revenue
size of the small business borrowers as I understand it. Without data on
lending to small businesses, it is impossible for the public at large to
hold the mid-size banks accountable for responding to the credit needs
of minority-owned, women-owned, and other small businesses. Data
disclosure has been responsible for Increasing access to credit
precisely because disclosure holds banks accountable. Your proposal will
decrease access to credit for small businesses, which is directly
contrary to CRA's goals.
Two other regulatory agencies, the Federal Reserve Board and the
Office of the Comptroller of the Currency, did not embark upon the path
you are proposing to take because they recognized the harm it would
cause.
If your agency were serious about CRA's continuing and affirmative
obligation to enforce banks' meeting community credit needs, you would
be proposing additional community development and data reporting
requirements for more banks instead of reducing existing obligations. A
mandate of affirmative and continuing obligations which is the CRA
implies expanding and enlarging community reinvestment, not
significantly reducing the level of community reinvestment.
Please let me know your decision in this important matter.
Sincerely,
Karen LaFranace
Executive Director
Neighborhood Economic Development Corporation
Mesa, AZ
cc: National Community Reinvestment Coalition
