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F ed e r a l R e s er v e Ba n k o f D allas
D ALLAS, TEX A S
75222
C ir c u l a r No. 77-62
May 26, 1977
REGULATION B—EQUAL CREDIT OPPORTUNITY
P ro p o se d In te rp r e ta tio n Dealing with F e d e ra l o r State
Special P u r p o s e C r e d i t P r o g ra m s
TO ALL BANKS, OTHER CREDITORS,
a n d o t h e r s c o n c e r n e d in t h e
ELEVENTH FEDERAL RESERVE DISTRICT:
T h e Board of G o v e r n o r s of th e F e d e ra l R e s e r v e System h a s p r o p o s e d for
comment a n in te r p r e ta tio n of th e p r o v is io n of its R egulation B—Equal C r e d it
O p p o r tu n it y —d e a lin g with F e d e ra l o r Sta te special p u r p o s e c r e d i t p r o g r a m s .
T h e Equal C re d it O p p o rtu n ity Act a n d R egulation B p r o v id e th a t it is not
illegal to d e n y c r e d i t to an a p p lic a n t solely b e c a u s e the a p p lic a n t does not qualify
for c r e d i t e x p r e s s l y a u th o r iz e d by F e de ra l o r State law for th e b e n efit of an econom
ically d i s a d v a n t a g e d c la s s of p e r s o n s . An exam ple of s u c h a special p u r p o s e c r e d i t
p r o g r a m would b e a p r o g r a m d e s ig n e d to be nefit economically d is a d v a n ta g e d
A m erican I n d ia n s . It is not illegal to e x c l u d e n o n -I n d ia n a p p lic a n t s for c r e d i t u n d e r
such a program .
T h e Board p r o p o s e d th e i n te r p r e ta tio n in r e s p o n s e to r e q u e s t s for g u i d
ance c o n c e rn in g th e c o v e r a g e of th is p r o v is io n .
T h e p r o p o s e d in te rp r e ta tio n would state th a t a c r e d i t p ro g r a m is c o n
s i d e r e d to be " e x p r e s s l y a u th o r iz e d b y F ederal o r Sta te law" if it is a u th o r i z e d by
the te rm s of a Fed eral o r State s ta tu te o r b y a re g u la tio n lawfully p ro m u lg a te d by
the Federal or Sta te a g e n c y r e s p o n s i b l e for implementing th e p r o g r a m .
T h e p r o p o s e d in te rp r e ta tio n does not deal with special p u r p o s e c r e d i t
p r o g r a m s u n d e r o th e r th a n Federal o r Sta te a u s p ic e s .
At th e same tim e, th e B oard a n n o u n c e d th a t it b e lie v e s d e te rm in a tio n s as
to w h e t h e r a F e de ra l o r S tate special p u r p o s e c r e d i t p ro g r a m be n efits an econom
ically d i s a d v a n t a g e d c la s s of p e r s o n s a r e b e s t made b y th e a g e n c y c h a r g e d with the
a d m in is tra tio n of th e loan p r o g r a m , a n d that th e B oard would not make such
d e te rm in a tio n s .
This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
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P r in te d on the following p a g e is the text of th e p r o p o s e d in te rp r e ta tio n
as su b m itte d for publication in th e FEDERAL REGISTER.
Comments on th e p r o p o s e d in te rp r e ta tio n sh o u ld be d ir e c te d to th e
S e c r e t a r y , Board of G o v e r n o r s of th e F ederal R e s e r v e S ystem , W ashington, D .C .
20551, to be re c e iv e d not later th a n J u n e 17, 1977. All material subm itte d should
in c lu d e the doc ket No. R-0100.
S in c e r e ly y o u r s ,
R obert H . Boykin
F i r s t Vice P r e s i d e n t
FEDERAL RESERVE SYSTEM
[ 12 CFR Part 202 ]
[R eg. B; D o c k e t N o. R -0 10 0]
EQUAL CREDIT OPPORTUNITY
Credit Program; Interpretation
E x tra c t From
FEDERAL REGISTER,
VOL. 42, NO. 96,
W ed n e s d a y , May 18, 1977
p . 25508
AGENCY: Board of Governors of the
Federal Reserve System.
ACTION: Proposed interpretation.
SUMMARY: In response to requests for
guidance concerning the intended cover
age of the provisions of Regulation B
relating to special purpose credit pro
gram s offered by Federal and State
agencies, th e Board proposes to in terpret
the term “expressly authorized by law.”
Lenders have sought this clarification to
determ ine w hether the government loan
program s in which they participate qual
ify for the p artial exem ption provided in
Regulation B. The Board is seeking pub
lic comment to aid in th e determ ina
tion of w hether the proposed in terpre
tatio n properly im plem ents the Equal
C redit O pportunity Act.
DATE: Comments m ust be received on
or before June 17,1977.
ADDRESSES: Secretary, Board of Gov
ernors of the Federal Reserve System,
W ashington, D.C. 20009.
FOR FURTHER INFORMATION CON
TACT:
Anne Geary, Acting Chief, Equal Credit
O pportunity Section, Division of Con
sum er Affairs, Board of Governors of
the Federal Reserve System, W ash
ington, D.C. 20551. (202-452-3946).
SUPPLEMENTARY INFORMATION:
(1) To aid in the consideration of this
proposed interpretation by the Board, in
terested persons are invited to subm it
relevant data, views, comments, o r argu
m ents. Any such inform ation should be
subm itted in w riting to the Secretary,
Board of Governors of th e Federal R e
serve System, W ashington, D.C. 20551
to be received no t la ter th an June 17,
1977. All m aterial subm itted should in
clude the docket num ber R-0100. Such
inform ation will be m ade available for
inspection and copying upon request ex
cept as provided in S 261.6(a) of the
Board’s Rules R egarding Availability of
Inform ation (12 CFR 261.6(a)).
(2) A uthority: 15 UB.C. 1691(b).
In order to provide guidance concern
ing th e intended coverage o f § 202.8(a) 1
of Regulation B, th e Board in terprets a
• S ta n d a r d s fo r p ro g ra m s . S u b je c t to th e
p ro v isio n s o f S u b se c tio n ( b ) , th e A ct a n d
th is P a r t a r e n o t v io la te d If a c r e d ito r re fu s e s
to e x te n d c r e d it to a n a p p lic a n t s o le ly b e
c a u s e t h e a p p lic a n t d o e s n o t q u a lif y u n d e r
th e sp e c ia l r e q u ire m e n ts t h a t d e fin e e lig i
b ility fo r th e fo llo w in g ty p e s o f s p e c ia l p u r
p o se c r e d it p ro g ra m s : (1 ) a n y c r e d it a s s is t
a n c e p ro g ra m s e x p re ssly a u th o r is e d b y
F e d e ra l o r S t a t e la w f o r th e b e n e f it o f a n
ec o n o m ic a lly d te d v a n ta g e d c la s s o f p e rs e h s .
term used in th a t section as follows: A
credit program is considered to be “ex
pressly authorized by Federal or State
law ” if it is authorized by the term s of
a Federal or S tate statu te or by a regu
lation lawfully prom ulgated by the
agency responsible for im plem enting th e
program .
In addition, th e Board announces th a t
it will not m ake determ inations as to
w hether p articular program s benefit an
“economically disadvantaged class of
persons.” The Board believes th a t such
a determ ination is m ore properly m ade
by the agency charged with the adm in
istration of the loan program .
By order of the Board of Governors,
effective May 9, 1977.
T
h eodore
E . A l l is o n ,
Secretary of the Board.
{FR D oc 77-14096 F ile d 6 -1 7 -7 7 :8 :4 5 t m |
@FedFRASER