Bowing to objections from banks and neighborhood activists, the White House is scuttling its campaign pledge to set up 100 community banks to provide loans to poor areas. Instead, the Administration plans to ask Congress to create an independent agency, tentatively called the National Trust for Community Development Lending, to parcel out grants and loans to existing groups that would lend to low-income areas. Banks disliked the competition the new banks would offer. And community groups felt the paltry funds Clinton plans to spend--less than $400 million mver five years--would go much further if they were channeled through established organizations with innovative lending ideas.

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