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Washington, DC - Today, the House overwhelmingly passed H.R. 1066, a bill that will increase community development investments by depository institutions.
Ranking Member Spencer Bachus (R-AL) of the House Financial Services Committee said, "The legislation will provide distressed areas with an additional source of investment to spur economic development. This ability of banks and thrifts to make community development investments that promote housing, employment, and other community services in distressed areas will benefit many communities across America. Most importantly, banks and thrifts will receive greater flexibility to invest in devastated communities on the Gulf Coast, as well as help in revitalizing rural areas that are underserved or distressed."
H.R. 1066 enhances the authority of both national and state banks that are members of the Federal Reserve System to make community development investments in areas designated for redevelopment by state and local governmental entities as well as in areas affected by natural disasters. In addition, the bill provides the same authority to federal thrift institutions. The change is necessary because last year, as part of a regulatory relief bill for financial institutions, the Senate insisted on restricting the ability of banks to make these kinds of investments.
"This is a piece of legislation that provides more flexibility for banks that are engaging in public welfare investments," said Financial Services Committee Chairman Barney Frank (D-MA). "We have banks that want to be socially responsible; we should not unduly burden them when they try to do that."
According to the Comptroller of the Currency, who regulates national banks, this change could potentially generate as much as $30 billion in national bank investments to help revitalize local communities. |
