Mandatory Stakeholder Capitalism Comes to Banks, Mortgage Finance
It more often than not really does pay to read the fine print.  Case in point: what new progressive legislation does to the Community Reinvestment Act (CRA).  As we show in our in-depth analysis, Sen. Warren and her Congressional colleagues didn’t stop with their headline proposal to rope nonbank mortgage companies into the controversial Act.  They in fact rewrite the 1977 law in almost its entirety to make covered financial companies instruments of a wide-ranging social-welfare and equity agenda.  This is “stakeholder capitalism” far beyond the earnest promises endorsed by those financial companies who espouse this new vision.  Like it or not, it’s a fundamental rewrite of every bank’s charter and, for nonbanks, also a transformation of their basic business.