E-MAIL THIS LINK
To: 

Bill Clinton's drive to increase homeownership went way too far - Bubba Bubble
FROM THE OFFICE OF PUBLIC AFFAIRS
April 19, 2000
LS-564

TREASURY DEPARTMENT RELEASES CRA STUDY

The U.S. Treasury Department released a report on Wednesday detailing lending to low- and moderate-income borrowers and low- and moderate-income communities covered by the Community Reinvestment Act. The study found that such lending rose significantly, totaling more than $600 billion between 1993 and 1998.

The First Lady likes to say it takes a village to raise a child, at Treasury we say it takes capital to build a village," said Treasury Secretary Lawrence H. Summers. "This study is further evidence that a strong Community Reinvestment Act is critical to ensuring that all neighborhoods are part of our national economic prosperity."

The study focused on lending trends in 305 U.S. cities between 1993 and 1998. Highlights include:
Does the name Henry Cisneros ring a bell?

- $467 billion in mortgage credit flowed from CRA-covered lenders to CRA-eligible borrowers.

- The amount of home mortgage lending to low- and moderate-income borrowers, low- and moderate-income communities rose 80% during that time. In 1998 alone, these institutions made $135 billion in mortgage loans to these borrowers.

- CRA-covered lenders and their affiliates increased mortgage lending to low- and moderate-income borrowers and communities at more than twice the rate of increase for other borrowers. The number of mortgage loans made by CRA-covered institutions and their affiliates to these borrowers and areas increased by 39 percent between 1993 and 1998, while such institutions' loans to other borrowers increased by only 17 percent.

- Subprime lending drove growth in lending to low- and moderate-income borrowers and areas for institutions not covered by CRA.

- CRA covered institutions increased their market share in prime mortgage lending to low- and moderate-income borrowers and areas. Lenders covered by the CRA primarily specialize in prime lending to borrowers without impaired credit. In this market, covered lenders and their affiliates increased their market share of lending. In 1993, such lenders accounted for 66 percent of prime mortgage loans to these borrowers and areas; by 1998, their market share had increased to 71 percent.

- In 84 percent of the metropolitan areas studied, CRA-covered lenders and their affiliates increased the share of their mortgage lending going to low- and moderate-income borrowers and areas, by as much as 12 percentage points
.
The study also found that from 1996 to 1998, the first three years these data were collected, lending by CRA-covered institutions to small businesses located in low- and moderate-income communities averaged $33 billion annually. In addition, community development lending by these institutions averaged $17 billion annually.

Link to Business Week Article Feb 2008
Posted by: GolfBravoUSMC 2008-10-10
http://www.rantburg.com/poparticle.php?ID=252371