Anti-Redlining Overhaul for Banks Paused by Texas Federal Judge

A federal judge in Texas blocked banking regulators’ rewrite of an anti-redlining law, giving banks a reprieve from a new regulation set to take effect Monday.

The Federal Reserve, the Federal Deposit Insurance Corp., and the Office of the Comptroller of the Currency went beyond the bounds of the 1977 Community Reinvestment Act in their final rules issued last October, Judge Matthew J. Kacsmaryk of the US District Court for the Northern District of Texas said in a ruling March 29.

The long-awaited CRA rules were set to expand regulators’ assessments of banks’ lending and investments in low- to moderate-income ...