WASHINGTON— Federal banking, credit union and housing regulators are rescinding 2022 guidance that encouraged lenders to use special-purpose credit programs, or SPCPs, to expand access to credit, saying the guidance no longer conforms with the government’s interpretation of federal fair lending law.
The rescission was submitted Monday to the Federal Register’s public inspection file, according to Bloomberg Law, which reported that lenders could face regulatory consequences for maintaining programs that conflict with the revised standards.
The original February 2022 interagency statement was issued by the Federal Reserve, FDIC, NCUA, OCC, CFPB, Department of Housing and Urban Development, Department of Justice and Federal Housing Finance Agency. It reminded banks, credit unions and other creditors that the Equal Credit Opportunity Act and Regulation B permitted SPCPs designed to meet the credit needs of specified classes of borrowers and encouraged institutions to explore such programs consistent with fair lending and safety-and-soundness requirements.
The reversal follows a broader change in federal policy toward SPCPs. In April, the CFPB amended Regulation B to prohibit for-profit lenders from using race, color, national origin or sex as factors in determining eligibility for an SPCP. The Bureau subsequently rescinded a 2020 advisory opinion on the programs in June, saying parts of that guidance had become outdated and conflicted with the revised regulation.