WISNIEWSKI/SPENCER BILL ENCOURAGING BANKS TO LOCATE IN UNDERSERVED AREAS ADVANCES

WISNIEWSKI/SPENCER BILL ENCOURAGING BANKS
TO LOCATE IN UNDERSERVED AREAS ADVANCES
Measure Would Create 'Banking Development Districts'
To Push Institutions to Open Branches

(TRENTON) - Legislation Assemblyman John Wisniewski and Assemblywoman L. Grace Spencer are sponsoring to encourage banking institutions to open branches in underserved communities was released by the Assembly Financial Institutions and Insurance Committee.

"Even with today's focus on saving and sound personal financial management, many residents live in areas with no community bank and no access to professional financial advice," said Wisniewski (D-Middlesex). "Encouraging banks to open the doors to financial security in traditionally underserved areas is key to giving more residents the tools they need to properly plan for their futures."

This measure (A-3071) would create a Banking Development District Program within the state Department of Banking and Insurance to help licensed financial institutions locate new branches in underserved communities.

To encourage banks to take part in the program, the bill would allow the state Treasurer to deposit public funds in a participating financial institution.  The governing body of a municipality in which a banking development district has been created also would have the option of using the bank as a depository.

The legislation mirrors a similar program in New York State.

"Residents whose only choices in banking are either branches located far from their homes or a corner check-cashing store really have no choices at all," said Spencer (D-Essex). "Promoting sound financial practices requires people to have a neighborhood bank they can trust. Unless we take the initiative to help people properly manage their money, we really haven't learned anything from the economic meltdown."

The bill now heads to the Assembly Speaker, who decides if and when to post it for a floor vote.