On behalf of Americans for Financial Reform Education Fund, The Greenlining Institute, and Public Citizen, we appreciate the opportunity to comment on the above referenced joint Notice of Proposed Rulemaking (“NPR” or “proposal”) by the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Federal Deposit Insurance Corporation (collectively “the agencies”) to amend the regulations implementing the Community Reinvestment Act of 1977 (CRA), including updates to which activities qualify for CRA consideration, and how those activities are evaluated and inform bank ratings.

Our organizations are dedicated to furthering financial inclusion and climate justice in historically underserved communities, and we see tremendous opportunities in the CRA regulations to support communities in achieving shared priorities. By facilitating investment in climate resilience, the CRA regulations will be meeting the modern-day credit needs of communities across the country in addition to legacy strategies such as affordable housing and small businesses.

This thoughtful proposal would provide additional opportunities for investment that communities have been seeking, including opportunities to build climate resiliency, in addition to providing greater clarity and consistency for all stakeholders involved. The agencies should strengthen the regulations to better ensure that communities most impacted by redlining and environmental injustice receive the intended benefits of the CRA.

Our main recommendations, which are elaborated on below, in addition to responses for specific questions from the proposal, are:

  1. Adopt the NPR’s proposed “disaster preparedness and climate resiliency” definition under “community development activities” and list additional eligible activities under the definition.
  2. Explicitly utilize race as a metric in CRA exams in order to ensure that historically redlined communities, and those most vulnerable to climate change, have improved access to sustainable credit and services.
  3. Encourage banks to increase community engagement and relationship building with climate and environmental justice organizations, including through the use of Community Benefits Agreements (CBAs).
  4. Scrutinize bank investments that have disproportionate impacts that further contribute to climate change and impair access to credit for communities as part of CRA exams.
  5. Do not raise the small and intermediate small bank asset thresholds.

 To read our full letter, please click here.