Round Two Begins!

Last week the bell rang to start Round Two in American's fight to keep banks honest/ for banks to clean up their mess. Sponsored by the Federal Reserve, the Federal Deposit Insurance Corp. and the Comptroller of the Currency July 19th was the first of a series of four public hearings on how to improve our community investment regulations. National People’s Action members from around the region flew in to sound the call for critical community investment.

Buffalo New York is in dire need of community reinvestment according to Aaron Bartley, Executive Director of People United for Sustainable Housing, “Buffalo’s neighborhoods were struggling before the financial crisis with an epidemic of vacant housing and the third highest poverty rates in the country. Community reinvestment can create good-paying jobs, promote a strategy for greening our cities on a grand scale and lower our cost of living.”

In Cincinnati in the 1980’s community reinvestment allowed Sister Barbara Busch and Working in Neighborhoods develop quality mortgages in partnership with local banks and rebuild homes so that over 5,000 families became homeowners.

But, Marilyn Evans, Executive Director of Communities United for Action in Cincinnati said, “We must have left the back door open, because bad money started coming into our communities through predatory lending, sub-prime loans and payday lending. Our communities are back in the same position we were in thirty years ago with redlining. With more empty foreclosed houses, our neighborhoods are going down and crime has increased.”

Banks need to invest in small businesses to get jobs back in the community; clean up neighborhoods littered with foreclosed and abandoned buildings. In order for our community investment laws to work, banks must be graded fairly by the regulators; this means counting all their lending and activity from their subsidiaries and wherever a bank does business, not just the ones the banks pick and choose. It means putting an end to financial discrimination against communities of color who routinely get the fewest good loans and the most toxic, high cost loans. National People’s Action called for the bank regulators start the process, but they need to hear from us and neighborhoods across the country on how to make sure banks do the job.

Next up - Hearings in Atlanta, Chicago and Los Angeles. Sign up to attend a hearing, offer testimony or send in a comment letter. All the details are available here.