Credit unions don't perform as good as banks on 65% of fair lending practices, according to a report by an organization that is pushing Congress to mandate that credit unions comply with the Community Reinvestment Act.
"While mainstream credit unions have made progress in lending to lower-income individuals, credit unions as a whole are not meeting public expectations for institutions that receive tax exemptions and are entrusted with the mission of serving people of modest means," according to a study by the National Community Reinvestment Coalition.
The report urges Congress to include credit unions under CRA and mandate that NCUA enhance the rigor of its anti-discrimination reviews.
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The report comes at a time of a continued push by congressional Democrats to include credit unions in the Community Reinvestment Act. Next Wednesday, a House committee is scheduled to hold a hearing on a bill to expand the measure to include credit unions and other institutions in CRA.
CUNA and NAFCU disputed the findings.
"Both lower-income and minority applicants are more likely to have their loans approved at credit unions than at banks," said CUNA Vice President of Economics and Statistics Mike Schenk.
While we are still reviewing the study, historically NCRC's assessment of credit union service to minorities and people of low-income has not been supported by a careful and in-depth analysis of Home Mortgage Disclosure Act (HMDA) data," said NAFCU Director of Research Tun Wai.
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