as the regulator of bank the government could and did pressure banks to make loans (mortgages) to were credit risks. If a bank did not bow to the pressure the government could make their life difficult.
In 1992 there were articles in the Charlotte Observer about “communty organizers” who were pressuring NCNB (who was later absorbed by Bank of America) to stop “redlining” certain areas of Charlotte, and start writing mortgages to people in those areas-they of course caved in to the pressure. One bank that didn’t was BB&T-who I understand is still pretty strong today. Just like the ICC with trucking companies, and the FCC with radio stations-if you were a private entity that was regulated by the government-you do what you’re told or the regualtors will put pressure on you.
What people don't understand, is CRA does not stipulate you have to sell to people who can not afford the loans.