NCRC Statement on Court Ruling to Overturn New York City’s Responsible Banking Act
WASHINGTON, D.C. – August 11, 2015 – (RealEstateRama) — The National Community Reinvestment Coalition (NCRC) reacted in disappointment to the ruling by U.S. District Judge Katherine Polk Failla overturning New York City’s Responsible Banking Act in The New York Bankers Association v. The City of New York. The Responsible Banking Act is one of several responsible banking ordinances that U.S. cities have recently passed, which require banks bidding on municipal deposits and investments to submit community development plans describing the loans, investments, and bank services they would provide to minority and modest-income neighborhoods.
“We are very disappointed in this decision,” said NCRC Chief of Membership and Policy Jesse Van Tol. “The New York City government should have the ability to gather the information needed to make informed decisions on which banks it hires to hold its municipal accounts. That’s what this ordinance does; it does not interfere with or impede state or federal bank regulatory measures. The city has a significant interest in banking with institutions that are a positive presence in New York. NCRC and its members will keep fighting to address a lack of neighborhood investment around the country, and the instability it causes.”
“Local communities around the country are working to mitigate the damage of the foreclosure crisis and prevent or reverse disinvestment from their towns and cities. Local responsible banking ordinances are simply a tool for cities to make sure that the banks that they select to work with are operating in a manner consistent with those goals.”
“On the federal level, the prudential regulators need to do much more to ensure that banks are serving the credit needs of communities, as required by the Community Reinvestment Act (CRA). In 2014, over 98% of banks evaluated received a passing grade on their CRA exams – a passage rate clearly not reflected by the experiences of working families across the country as they attempt to secure a mortgage or small business loan or access a bank branch. It’s time for regulators to get serious about enforcing the law.”
NCRC has been a leader in organizing local advocates to advance responsible banking ordinances, including the passage of New York City’s Responsible Banking Act in 2012. In recent years NCRC has also helped to advance the passage of ordinances in Washington, DC, Los Angeles, San Diego and several other cities. In 2012, NCRC released an updated version of its model city ordinance, which was first made available in 2010.
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About the National Community Reinvestment Coalition (NCRC): The National Community Reinvestment Coalition is an association of more than 600 community-based organizations that promote access to basic banking services, including credit and savings, to create and sustain affordable housing, job development, and vibrant communities for America’s working families.
