CRA final rule: it's official

The Federal Register got around to publication of the three-agency Community Reinvestment Act final enforcement rule today. (PDF version here.) We described the gist of this one earlier, when the text was first announced.

The new rules do reduce the thoroughness of CRA enforcement (or the burden thereof, depending who you ask), but the reductions are not so sharp as seemed possible a year ago. During the drawn-out approval process for these new enforcement standards, community development advocates argued that every lost bit of regulatory carefulness would give bankers one more chance to avoid doing business with low-income and minority customers as the CRA requires. Banking institutions -- and, to some extent, regulators themselves -- have argued that the new rules reduce unnecessary paperwork and give flexibility to local bank managers who know the needs of their own communities better than officials in Washington do.

Stay tuned: word has it we'll be publishing a column by John Taylor of the National Community Reinvestment Coalition in the September issue of Affordable Housing Finance.