REPORT OF THE CHIEF LEGISLATIVE ANALYST AUGUST 2018

This report from the Chief Legislative Analyst reviews gaps in banking services for individuals in Los Angeles; presents CRA data for housing and small businesses, which show a lower rate of lending in certain geographic areasof the City; and identifies gaps in City services related to banking services and proposes several program enhancements that could improve banking services for City residents, as well as areas for additional program development. It examines the "banking deserts" in Los Angeles - geographic areas in LA County where residents do not have access to either a bank or a credit union- and thus susceptible to Alternative Financial Services and predatory payday lending services. Over 600,000 residents are affected. The report notes that home ownership among low-income residents are serious affected by a lack of financial institutions in these banking deserts due to inability to obtain low-interest loans. It concludes that that the lack of access to banking services in the Los Angeles region has serious financial consequences for residents. The CLA also recommends that Council sponsor state legislation that creates a regulatory framework for the formation of public banks in California.