Banking and Finance Law Daily Wrap Up, COMMUNITY DEVELOPMENT—House Financial Services Democrats warn regulators against weakening CRA, (Sep 28, 2026)
Organizations Mentioned:Office of the Comptroller of the Currency | U.S. House of Representatives
By Nora Macaluso
The lawmakers asked the regulatory agencies to extend the comment period on proposed changes to the Community Reinvestment Act.
Democrats on the U.S. House of Representatives Financial Services Committee have sent a letter to the heads of the Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency, warning that proposed changes to the Community Reinvestment Act would weaken regulation and could “work at cross purposes” with recent legislation to encourage affordable housing.
The lawmakers, led by Rep. Maxine Waters (D-Calif.), the top Democrat on the panel, asked FDIC Chairman Travis Hill and Comptroller of the Currency Jonathan Gould to extend the comment period on the proposal “to at least 120 days.”
The agencies in August issued a joint notice of proposed rulemaking that provided a 60-day comment period ending in October (see Banking and Finance Law Daily, Aug. 3, 2026).
“At over 400 pages, the FDIC and OCC’s new proposal is extensive and covers a wide range of topics,” the letter said. “Taken together, the proposed revisions likely will significantly impact which institutions are encouraged to meet the credit needs of their communities through activities that extend beyond lending such as community development activities.”
Among those revisions are a change in how the agencies consider retail banking services for CRA evaluation purposes by narrowing the range of services considered as “retail” banking services to limit them to the range and availability of a bank’s “credit services” and the distribution and availability of a bank’s retail banking facilities.
The lawmakers said the proposal would make it easier for banks to receive an “outstanding” rating and reduce the number of banks evaluated for community development activities. It could also undermine changes contained in the recently passed ROAD to Housing Act, which is designed to boost housing affordability.
The Democrats said their concerns are “widely shared,” and that more than 375 organizations have raised “serious concerns” about the plan and said they needed more time to evaluate it.
“Adding to those concerns is how regulators advanced the proposal in the first place,” the Democrats said in a press release. “The FDIC Board adopted the sweeping changes behind closed doors through a notational vote rather than at a public meeting where Americans could observe regulators debate and discuss the proposal.”
“As we and other stakeholders analyze this new proposal, we request that the public comment period be extended to no less than 120 days to give members of the public more time for substantive review and comment on this sweeping proposal,” they said in their letter to the regulators.
Joining Waters in signing the letter were Reps. Nydia Velázquez (D-NY); Brad Sherman (D-CA); Gregory Meeks (D-NY); Stephen Lynch (D-MA); Al Green (D-TX); Emanuel Cleaver (D-MO); Jim Himes (D-CT); Bill Foster (D-IL); Joyce Beatty (D-OH); Juan Vargas (D-CA); Josh Gottheimer (D-NJ); Vicente Gonzalez (D-TX); Sean Casten (D-IL); Ayanna Pressley (D-MA); Rashida Tlaib (D-MI); Ritchie Torres (D-NY); Sylvia Garcia (D-TX); Nikema Williams (D-GA); Brittany Pettersen (D-CO); Cleo Fields (D-LA); Janelle Bynum (D-OR); Sam Liccardo (D-CA); and Everton Blair (D-GA).
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