Metro Lex News

Washington, D.C. - Congressman Andy Barr (KY-06) has expressed his concerns over the recent Final Rule on Community Reinvestment Act (CRA) Regulations issued by the Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corporation (FDIC), and Federal Reserve Board.

In his statement, Barr acknowledged the importance of the CRA in eliminating redlining and promoting investment in local communities. However, he criticized the current rule, stating that it is "under analyzed, not forward-looking, and will only lock in the status quo." According to Barr, the rule's micro-management of banks' operations poses a risk of reducing credit availability to underserved communities, contrary to the original intention of the CRA.

Barr further criticized the rule's definition of a "large" bank, stating that its consequences have not been thoroughly examined and are likely to be negative. He expressed his disappointment in the federal banking agencies for disregarding the analysis of their proposals and rules, potentially leading to unintended consequences and partisan credit channeling.

"The CRA was not intended to be a tool for activists to channel credit and investments to progressive causes," Barr argued. He expressed concern that the new rule may be exploited by activists and politically unaccountable regulators.

Barr and his Republican colleagues have long advocated for the modernization of CRA regulations, emphasizing the need for increased consistency, clarity, and objectivity in assessments. Unfortunately, the recently promulgated rule, according to Barr, fails to address these concerns and instead maintains the outdated status quo.

While the CRA aims to promote fair lending practices and economic development in underserved communities, Barr's criticism highlights the challenges in finding a balance between regulation and the needs of financial institutions. The debate surrounding the CRA regulations is likely to continue as stakeholders seek ways to modernize and improve the effectiveness of the Act.

To learn more, click on this link: https://barr.house.gov/press-releases?ID=9F7BA457-7F6A-4861-9914-6F1AEF9B1938