FDIC Federal Register Citations

From: Novas, Cheryl [mailto:Cheryl.Novas@lssi.org]
Sent: Monday, September 20, 2004 10:17 AM
To: Comments
Subject: RIN 3064-AC50
Importance: High

BACKGROUND: This special Heads Up calls your attention to an urgent issue of which we have just been made aware. It regards changes to banking regulatory issues that would exempt 97% of FDIC-regulated banks in Illinois from completing testing that would obligate them to invest in affordable housing, health clinics, economic developments, human services and fair lending practices. If the FDIC adopts this proposal, these regulatory changes will gravely hurt people in low economic environments and communities across Illinois by reducing requirements and market competition.
Currently, the Community Reinvestment Act (CRA) requires that banks with over $250 million in assets must be tested on their number of loans, investments, and services to low and moderate-income communities. A new Administration/FDIC proposal would eliminate these requirements for all banks with under $1 billion in assets. The results would be:
fewer grants to nonprofits to provides services such as financial education
fewer bank branches and service products available
fewer investments in affordable rental housing, health clinics, community centers, and economic development projects.
In Illinois 97% of banks fall under this $1 billion threshold, meaning that banks would have no obligation to provide such services as those listed above. Only 13 banks would be left in the state to provide such services. Poor and disadvantaged people, people who need easy access to such services, would be unjustly hurt economically.
My poisition supports strategies that address a continuum of concerns relating to issues of poverty (housing, hunger, taxation, medical coverage, tax policy). This regulatory change would create harsh disadvantages for the poor and middle income families in urban, suburban and rural communities.
I, as a voter and taxpayer support policies for fairness in lending and accessible economic solutions to be available for all, but especially the already financially over-burdened.

Cheryl A. Novas
Hoffman Estates, IL