WASHINGTON—Credit unions are not included in a Treasury report released this week on recommendations to reform the Community Reinvestment Act (CRA).
The CRA applies to financial institutions insured by the Federal Deposit Insurance Corp. Both CUNA and NAFCU indicated they have met with the Trump Administration to lobby in favor of keeping credit unions from under the CRA umbrella.
CRA is designed to increase access to banking services to low- and moderate-income communities. The Treasury said in a 2017 report to President Trump that it would comprehensively assess how the CRA could be improved.
CUNA noted that its staff met with the Treasury in January, explaining credit unions’ mission and structure, and how Congress explicitly excluded credit unions from the CRA because of credit unions’ not-for-profit, cooperative structure, field of membership restrictions and lack of history of discriminatory lending processes.
The only mention of the term “credit union” in the report is a statement noting the CRA does not apply to credit unions, CUNA reported.
The Treasury Department report listed recommendations to modernize the CRA that include incorporating performance incentives to better serve the CRA's intended purpose and improvements to the act's examination process, NAFCU reported.
Other recommendations by Treasury to modernize the CRA, noted NAFCU, include:
- Updating the definition of geographic assessment areas to reflect today's trends in banking
- Increasing the clarity and flexibility of CRA examinations