Federal Reserve Bank of San Francisco

Community Development

The Community Reinvestment Act: Outstanding, and Needs to Improve


February 2009

Community Development Investment Review

The Community Reinvestment Act (CRA) of 1977 responded to charges of redlining and discrimination by financial institutions. It induces depository institutions to “help meet the credit needs of the local communities in which they are chartered” in a manner “consistent with the safe and sound operation of such institutions.” With these guiding principles and broad regulator discretion as to how to implement them, the act has proven flexible and adaptable over time.

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