The Federal Reserve Banks of Boston and San Francisco announce the publication of a new book, Revisiting the CRA: Perspectives on the Future of the Community Reinvestment Act, that provides perspective on how the Community Reinvestment Act (CRA) has evolved over the years and considers what role it should play in the future.

Originally enacted in 1977, the CRA has been influential in determining how banks do business in low and moderate income communities. The Act has aimed to ensure that banks meet the credit needs of entire communities.

Comprising a series of papers and essays, Revisiting the CRA is intended to encourage and help frame informed debate about the future of the CRA. It includes contributions from academic researchers, representatives of financial institutions and trade groups, current and former regulators, community development professionals, and consumer advocates.

Revisiting the CRA contains important new arguments about expanding CRA, the limits of CRA, and the basis for CRA. Mark Pinsky, for example, outlines a provocative new way to think about geography. Several authors argue for the inclusion of affiliates and outside-assessment-area lending in CRA exams. Major topics addressed by the book include the following:

• Is the CRA still needed?
• Should CRA-like obligations be extended to other types of financial institutions?
• Should the CRA target low and moderate income people instead of geographies?
• Should race and ethnic origin be introduced as CRA considerations?
• Should the CRA focus more on the terms and price of credit, rather than mere access to credit?
• Should “process” be evaluated rather than, or in addition to, numbers? 

In addition, multiple authors tackle head-on the criticism that CRA is to blame for the subprime mortgage crisis.

With the current financial crisis providing strong impetus for regulatory reform, a re-examination of the CRA seems both appropriate and likely. Revisiting the CRA thus provides timely perspective that can be useful in any debate about the future of CRA.

Revisiting the CRA is available in its entirety on the Boston Fed's web site. It may be downloaded or viewed on screen, chapter by chapter or in its entirety:
http://www.bos.frb.org/commdev/cra/index.htm