Fed Champions Clearer Mortgage Standards

Federal Reserve Board Governor Randall Kroszner has called for greater transparency in an industry bugged down by unease and uncertainty.

Speaking at a community investment forum in Minneapolis on Monday, Krosner said, "To attract new capital, or simply hold on to what they have, the community development financial institutions need not just new investment products but 'a significant investment information gathering, processing and evaluation.'

Kroszner also pointed out that the increased cost of borrowing in many areas reflects the crisis of confidence that has gripped the banking sector.

"Risk spreads that had been unusually small in recent years are now unusually large," he concluded.