Community Reinvestment Act Transparency
The Community Reinvestment Act (CRA), enacted in 1977, is a landmark federal law in the United States designed to encourage commercial banks and savings associations to help meet the needs of borrowers in all segments of their communities, especially underserved populations and neighborhoods. The CRA seeks to address the historical issue of "redlining," where banks would avoid lending in certain neighborhoods based on racial or economic criteria. Under the CRA, financial institutions are evaluated on their efforts to provide loans, investments, and services to all parts of their communities, including low- and moderate-income areas. The law mandates regular reviews of bank performance in these areas, with ratings that can affect banks' ability to merge or expand. The CRA aims to promote economic equality and accessibility by ensuring that all communities have access to banking services and credit, thereby fostering community development and revitalization.
