Community Development Banking News
CDFI Banking: Industry, Policy, and Beyond.
CDBA extends our congratulations to members Susan Chapman Plumb of Local Bank and Darrin L. Williams of Southern Bancorp on being appointed an reappointed to the CDFI Fund's Advisory Board!
"Today, the White House announced new appointments by President Biden to the Community Development Advisory Board (the Advisory Board), a 15-person federal advisory committee to the U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund). The function of the Advisory Board is to advise the CDFI Fund's Director on the policies regarding the activities and programs of the CDFI Fund.
'I am pleased to congratulate and welcome this esteemed group of professionals who share the CDFI Fund's vision of an America in which all people and communities have access to the investment capital and financial services they need to prosper,' said CDFI Fund Director Pravina Raghavan."
"'Demand for community and support services rose somewhat as individuals and households continued to seek housing, medical, and food assistance. Closures of childcare facilities and recent heat waves in some regions led to higher demand for related support services. Nonprofit organizations faced more difficulties securing funds despite a slight increase in contributions from government sources. Small businesses continued to face challenges with access to credit and sluggish demand in urban cores, forcing some of them to close. One Washington contact noted a rise in demand for educational and training services such as credential and certificate programs,' notes the Federal Reserve Bank of San Francisco in their Community Conditions section of the most recent Beige Book."
"Optus Bank hasn't grown the way CEO Dominik Mjartan expected it to when he joined the company seven years ago. It's grown differently, and more rapidly, than anyone might have imagined.
The South Carolina-based bank, one of about 20 Black-owned banks in the country, was on "life support" in 2017, Mjartan said. Now, Optus has increased its assets by more than 1,000%, raised over $100 million of equity and chipped its way to a profitable business plan.
So Mjartan is stepping down.
'There have been so many moments... over the last year where I thought, "This is the time," Mjartan said.'"
Today, August 29th, CDBA was joined by the American Bankers Association and the Independent Community Bankers of America on a joint national banking trades letter to the CDFI Fund Director. The letter proposes practical solutions to outstanding challenges with the December 2023 certification application and guidance that are of particular importance to the certification of CDFI banks.
The Community Development Bankers Association (CDBA), representing
the nation's leading mission-focused banks, acknowledges the recent federal court ruling that denied the request for summary judgment in the lawsuit challenging the Consumer Financial Protection Bureau's (CFPB) final rule implementing Section 1071 of the Dodd-Frank Act.
Jeannine Jacokes, CEO of CDBA, stated, "CDBA strongly supports efforts to ensure all small businesses are fairly and well served. We welcome the court's ruling to the extent it moves us closer to regulatory certainty and advances the critical goal of preventing discrimination in business lending."
The ruling, issued by Judge Randy Crane, determined that the CFPB did not exceed its authority nor violate the Administrative Procedure Act (APA) in developing the small business data collection rule. While the court did not comment on the policy wisdom of the final rule, the decision underscores the importance of following a comprehensive administrative process in rulemaking.
"A federal court today denied a request for summary judgment in a lawsuit by the American Bankers Association, Texas Bankers Association and others challenging the Consumer Financial Protection Bureau's small business data collection rule. In his decision, Judge Randy Crane ruled that the CFPB did not exceed its authority in issuing the rule, nor did it violate the Administrative Procedure Act, or APA, which governs how agencies develop regulations. ABA and TBA plan to appeal the case to the Fifth Circuit Court of Appeals."
"The U.S. Department of Housing and Urban Development and the U.S. Department of the Treasury today announced new actions to provide more interest rate certainty for state and local Housing Finance Agencies (HFAs) that use the Federal Housing Administration's (FHA) risk sharing initiative with the Federal Financing Bank to finance new construction of affordable housing. Since Day One, the Biden-Harris Administration has been committed to using all available tools to boost the supply of affordable homes and lower housing costs for all Americans. This whole-of-government effort is outlined in today's White House fact sheet, which highlights HUD's latest actions to increase the construction of affordable new homes."
"It's no secret that our nation faces a massive housing affordability crisis. With soaring rents and home prices shutting the door to homeownership for moderate- and middle-income families, this has truly become an emergency. Historically, community development financial institutions have played only a small role in housing finance outside of a few large entities supporting traditional affordable housing projects. However, current circumstances have created an opportunity for CDFIs to significantly impact the housing crisis through new and innovative approaches."
"Our institution continues to raise the bar for what mission-focused community development banks can accomplish, as well as for the impacts we can create for underserved communities. In 2022, we set out to lay the groundwork for an ambitious five-year plan to double in size and impact, which we've dubbed our Delivering Impactful Growth Strategic Roadmap. Last year, that foundational planning was put into action, momentum that will help propel us through the remaining five years of this growth plan.
Thanks to our employees at every level, some of whom in positions and divisions that are new to our organization, as well as the support of our partners, this expansion of our efforts produced some incredible impacts for our communities in 2023."
Treasury urges Federal Home Loan banks to spend more on affordable housing:
"On July 31, Deputy Secretary of the Treasury Wally Adeyemo met with the leadership of the 11 Federal Home Loan Banks (FHLBs) and the Director of the Federal Housing Finance Agency (FHFA), Sandra Thompson, to discuss what steps the FHLBs can take to better support the development of affordable housing.
During the meeting, Deputy Secretary Adeyemo urged the FHLBs to deploy more of the significant resources at their disposal to expand housing supply in service of their public mission. Specifically, Adeyemo called on FHLBs to spend at least 20% of their net income on affordable housing and to use a portion of their existing unrestricted retained earnings to create a pool of capital that can lower the cost of new housing production across the country."