Before the government permits E-Trade Group Inc. to buy Telebanc Financial Corp., it should force the on-line discount brokerage to reinvest in communities nationwide, critics said.

Telebanc's thrift subsidiary, Telebank, now limits its Community Reinvestment Act investments to Arlington, Va., where it is headquartered and operates its only branch. That would not change after the proposed merger, according to the CRA plan that Menlo Park, Calif.-based E-Trade filed in July with the Office of Thrift Supervision.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.