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In 1977, Congress passed the Community Reinvestment Act (CRA), which requires regulated financial institutions to help meet the credit needs of all communities in the service area they are chartered to operate. Banks are the single largest investor in the CDVC industry, accounting for more than 40 percent of all capital, and the Community Reinvestment Act has been critical in building this investment track record. Without the CRA, many financial institutions would discontinue or drastically reduce the level of investment or services they provide to low- and moderate-income communities.
CDVC funds are qualified investments under the Community Reinvestment Act an acknowledgement of the importance of the CDVC industry and its tremendous ability to provide financial support to underserved and distressed areas. Periodically, the staffs of the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency, and Office of Thrift Supervision provide CRA guidance to financial institutions and the public.