Federal banking regulators have rejected a request that they stop issuing "outstanding" Community Reinvestment Act ratings.
Failure to award outstanding ratings "would penalize institutions that have achieved the highest level of CRA performance," the government's top banking officials wrote in letters sent Dec. 3 to Reps. Charles E. Schumer, D-N.Y., and Joseph P. Kennedy 2d, D-Mass., and to Allen Fishbein, general counsel for the Center for Community Change.
But the regulators said they are planning to hold additional training and conduct several joint CRA reviews to ensure examiners are rating banks consistently.
Federal Reserve Board Chairman Alan Greenspan, acting Federal Deposit Insurance Corp. Chairman Andrew C. Hove Jr., Comptroller of the Currency Eugene A. Ludwig, and Office of Thrift Supervision Director Ellen Seidman signed the letters.
Activists and Democratic lawmakers have complained that regulators are too lenient in judging community lending efforts. They asked that no outstanding ratings be awarded until "more meaningful" standards are devised.