WASHINGTON - Comptroller of the Currency Eugene A. Ludwig on Wednesday said regulators will complete their overhaul of the Community Reinvestment Act by mid-April.

At a House Banking subcommittee hearing that was disrupted by protesters chanting "Save CRA," Mr. Ludwig said the March 31 deadline set by Vice President Gore was "too short a time frame."

However, Rep. Bruce Vento, the financial institutions subcomittee's senior Democrat, pressed Mr. Ludwig and three other regulators at the hearing to finalize the rules by the date set by the vice president.

"The regulated need CRA certainty and predictability today - not further uncertainty, which will invite yet a different solution," the Minnesota Democrat said.

The reform is designed to focus CRA evaluations in three performance criteria: lending, service, and investment. The new rules would have wide industry support if the agencies drop a new requirement to collect race and gender data.

However, Mr. Ludwig and the other three banking regulators - Federal Deposit Insurance Corp. Chairman Ricki Tigert Helfer, Federal Reserve Governor Lawrence Lindsey and Office of Thrift Supervision acting director Jonathan Fiechter - appear unlikely to drop the requirement.

"(Collecting the data) would help banks monitor their own lending performance and enable the examiners to make more complete assessments of an institution's commitment to fair lending," Mr. Ludwig said.

Rep. Bill McCollum, R-Fla., said he was concerned that the CRA reform may force banks to resort to credit allocation in order to receive favorable ratings. Mr. Lindsey admitted that credit allocation could occur under the proposed changes.

"Despite our best intentions, this is an undeniable risk," Mr. Lindsey said. The new regulation should include "flexibility and responsiveness to local conditions," he said.

"We must not substitute the judgment of the agencies for the judgment of the banks," Mr. Lindsey added.

Rep. McCollum, an outspoken critic of the CRA, recently introduced legislation that would not allow applications by institutions with at least a "satisfactory" CRA rating in the previous two years to be denied on CRA grounds.

The protesters, from the Association of Community Organizations for Reform Now, or Acorn, are particularly concerned about legislation that might include that kind of safe harbor.

Five Acorn protesters were arrested Wednesday after they made their way through the hearing room toward Rep. Marge Roukema, the subcommittee chairman.

In her testimony, Ms. Helfer said it "may make more sense to see how the reforms work before including a safe harbor provision."

Rep. McCollum said he expected to introduce more CRA legislation soon that "would make a lot of the regs that (banking regulators) are working on now moot." No further details on the bill were available.

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