Assembly committee advances AB 801 to create a California Community Reinvestment Act

Assemblymember Bonta introduced AB 801, a bill to establish a California Community Reinvestment Act, and the Assembly Banking and Finance Committee voted to pass the bill as amended and refer it to the Assembly Appropriations Committee.

The bill’s author said AB 801 would impose a continuing, affirmative obligation on covered financial institutions — including state‑chartered banks, credit unions, residential mortgage lenders and money transmitters — to meet the credit and service needs of low‑ and moderate‑income communities and communities of color where the institutions do substantial business. The bill would direct the Department of Financial Protection and Innovation (DFPI) to conduct a disparity study and to evaluate and rate covered institutions’ community investments; institutions receiving low ratings in two consecutive examinations could be barred from receiving state funds or…