Opinion: Changing Rules to Help Bankers and Hurt Poor Neighborhoods. The Community Reinvestment Act needs a renovation. The Trump administration instead is proposing a partial demolition. By The Editorial Board. The editorial board is a group of opinion journalists whose views are informed by expertise, research, debate and certain longstanding values. It is separate from the newsroom. Jan. 10, 2020
Banks don’t like lending in lower-income neighborhoods, even as they profit from deposits taken from those same communities. Since 1977, the Community Reinvestment Act has forced the issue, requiring banks to provide mortgages, small-business loans and other services in all areas where they operate. The current crop of federal banking regulators, picked by President Trump, is now proposing to let banks pump less money into lower-income communities, and even to claim credit for lending that does not benefit those communities. One egregious example: Banks could count loans for improvements to stadiums that happen to sit in poor neighborhoods. Yes, you read that right: Under the proposal, the banks that financed the new sound system at M&T Bank Stadium in Baltimore could claim credit for investing in the community.