Week 1 (Jan 14): Introduction to the U.S. Banking SystemWeek 2 (Jan 21): History & Theory of RedliningReadingsWeek 3 (Jan 28): Is More Financial Openness a Remedy to Redlining? The Federal Reserve Bank Thinks So…Week 4 (Feb 4): From Redlining to Hyper-Segmentation: Subprime & Predatory LendingWeek 5 (Feb 11): The Mortgage Meltdown & Foreclosure CrisisWeek 6 (Feb 18): Measuring Credit Flows (LAB SESSION)Week 7 (Feb 25): Techniques of Lending Research (LAB SESSION)Week 8 (Mar 4): Fair LendingWeek 9 (Mar 11): The Community Reinvestment Act & Its BrethrenWeek 10 (Mar 18): Development FinanceWeek 11 (Apr 1): Mortgage Modification & Alternatives to ForeclosureWeek 12 (Apr 8): Topics TBAWeek 13 (Apr 22): Topics TBAWeek 14 (Apr 29): Topics TBAUPP 594 | Community Reinvestment Urban Planning and Policy ProgramSpring 2010 University of Illinois at ChicagoUPP 594 Topics in Urban Planning and PolicyCommunity Reinvestment: Building Access to CapitalThursday 12:00pm– 2:50pmADH 223430616Instructor: Phil AshtonOffice: 231 CUPPA HalPhone: 312-413-7599Fax: 312-413-2314E-mail: [email protected] InformationThis course will introduce students to the variety of issues involved in expanding access to credit in inner city neighborhoods and other historically underserved markets. This topic has been of crucial interest for over four decades as planners, policymakers and advocates have sought to remedy disinvestment and build individual and community wealth through an increased pace of financial investment. It has also taken on critical importance in light of themortgage and foreclosure crisis that has taken shape since 2007, as policymakers and practitioners now face the question of what the future of the US housing and retail finance system will be.The core of the course will focus on the strategies being employed to expand access to fair credit among low-income/minority borrowers and neighborhoods. As Chicago has historicallybeen a center for the community reinvestment movement, we will use the city as a laboratory to learn about different sectoral emphases (mortgage lending, financial services for households, small business lending), as well as different organizational strategies (community reinvestment agreements, community development financial institutions). Throughout, we will pay close attention to the public policy environment that supports these initiatives.The course will also equip students to analyze different developments in the financial sector for their effects on inner city markets. This will include in-depth discussion and analysis of the following topic areas:□□The history and theory of redlining and lending discrimination. Why would banks refuse to make loans to low income or minority borrowers and the neighborhoods where they are concentrated? When economists say that a more efficient market will remedy these behaviors, should we believe them?□□The globalization of the financial system and the sources of the current mortgage andforeclosure crisis. Does the integration of financial capital into global markets result in greater financial exclusion? Why have issues such as the rise of the subprime market, predatory lending and fringe/payday lenders become so prevalent in such a short period of time, and how did they come to produce such widespread carnage?□□The history of organizing around fair access to credit. Since the late 1960s, community organizations and civil rights groups have succeeded in passing a patchwork quilt of federal, state and local laws that aim to remedy credit inequities. How do these laws work? How have they evolved as the financial system has been transformed over the last twenty years?Page 1UPP 594 | Community Reinvestment Urban Planning and Policy ProgramSpring 2010 University of Illinois at Chicago□□Finally, the course will introduce students to methods of assessing credit inequities. How do we measure inequities or gaps in the availability of fairly priced credit using publicly-available data? By the end of the semester, students in this course should have accomplished the following:□□Developed a literacy in the concepts that explain how banks behave in US inner cities, and expanded that literacy by examining in detail the debates over how best to meet the credit needs of low-income and minority households and neighborhoods; □□Gained a broad overview of the history and practice of community reinvestment in the U.S., including the strategies targeted by public and private actors to influence the pace and scale of financial investment in inner city markets; and □□Developed and practiced core methods for critically assessing alternative development policies and programs. Course RequirementsThe requirements for this course include the following:□□Weekly Readings & Class Participation: A maximum level of participation by students is required. I expect you to do the required readings listed in the syllabus prior to attending class. They constitute approximately 2-3 hours of reading for each class. Please read the assigned material and come prepared to contribute to the class discussion (10 percent).□□Short Analytical Assignments: o Merger Analysis: You will write a short policy brief assessing a bank merger (20 percent).o Lending Disparities: You will prepare an analysis of bank lending behavior and write a CRA policy memo (20 percent).□□Final Paper & Presentation: I will ask you to choose a current issue or model related tothe material and write an original research paper on a policy or practice issue directlyrelated to banking, community reinvestment, or financial investment issues in inner city markets. Each of you will prepare a preliminary presentation based (15 percent presentation, 35 percent final paper).Course Outline & Schedule1As a form of supplemental reading, students may find it useful to follow along with current developments in banking or retail finance through one or another RSS feed. I find Housing Wire, Calculated Risk and Naked Capitalism to all be good timely sources of information.1 Note: All readings marked * may found online at the course Blackboard site.Page 2UPP 594 | Community Reinvestment Urban Planning and Policy ProgramSpring 2010 University of Illinois at ChicagoSECTION 1: CONCEPTS & DEVELOPMENTS IN US BANKINGWeek 1 (Jan 14): Introduction to the U.S. Banking SystemWeek 2 (Jan 21): History & Theory of RedliningReadings□□* Immergluck, Daniel. 2004. Credit to the Community: