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ICBA continued its campaign opposing changes to the Community Development Financial Institution certification application during a meeting with House Financial Services Committee Ranking Member Maxine Waters (D-Calif.).
Meeting: During Thursday’s meeting, ICBA President and CEO Rebeca Romero Rainey and ICBA Minority Bank Council Vice Chairman Carlos Naudon discussed the negative impact of losing CDFI banks’ certification—particularly those that have received Emergency Capital Investment Program funds. Waters acknowledged the importance of CDFIs and community banks, and she said she will help ensure ICBA’s concerns are heard by Treasury.
Delay: The CDFI Fund this week delayed the launch of the changes in the wake of opposition by ICBA and members of Congress. The CDFI Fund said it is postponing the launch of the new application beyond the previously anticipated April timeline and will announce a revised timeline “in the near future.”
ICBA Opposition: In a comment letter and congressional briefing last month, ICBA expressed opposition to application revisions that would rescind CDFI certification for banks that offer loans with annual percentage rates greater than 36% or originate balloon mortgages. ICBA said some community banks offer products with these characteristics due to the unique situation of their customers.
Congressional Pressure: ICBA and other groups later requested a meeting with members of Congress to discuss the revisions. Senate Banking Committee members Mark Warner (D-Va.) and Mike Crapo (R-Idaho) last week encouraged the Treasury Department to consider stakeholder concerns with the changes, while last month’s year-end omnibus directed the CDFI Fund to address CDFI concerns.
Outlook: ICBA will continue working with the CDFI Fund, Treasury, and Congress to ensure any revisions to the CDFI certification application are not detrimental to community banks and the communities they serve.