Inner City Press' Community Reinvestment Reporter

  

     Welcome to Inner City Press’ CRA Report.  Our other Reporters cover the financial services industry, human rights, the Federal Reserve, and other beats.  ICP has published a book about the CRA-relevant topic of predatory lending - click here for sample chapters, a map, and ordering informationCBS MarketWatch of April 23, 2004, says the the novel has "some very funny moments," and that the non-fiction mixes "global statistics and first-person accounts."  The Washington Post of March 15, 2004, calls Predatory Bender: America in the Aughts "the first novel about predatory lending;" the London Times of April 15, 2004, "A Novel Approach," said it "has a cast of colorful characters."  See also, "City Lit: Roman a Klepto [Review of 'Predatory Bender']," City Limits, Oct. 2004.  The Pittsburgh City Paper says the 100-page afterword makes the "indispensable point that predatory lending is now being aggressively exported to the rest of the globe." Click here for that review; click here to Search This Site  Click here for Inner City Press' weekday news reports, from the United Nations and elsewhere.

Click here for Inner City Press' weekday news reports, from the United Nations and elsewhere. Click here for a recent BBC piece on Inner City Press' reporting from the United Nations. New: Follow us on TWITTER   BloggingHeads.tv  Click for March 1, 2011 BloggingHeads.tv re Libya, Sri Lanka, UN Corruption by Inner City Press. 2014: MRL on Beacon Reader  For or with more information, contact us.

December 18, 2017

After ICP Bank Merger Challenge, Fed Asks Associated About Green Bay Market, CFPB Statis?

By Matthew R. Lee, Fed letter here

NEW YORK, December 14– When Associated Banc-Corp to merge with Bank Mutual Corporation, Inner City Press / Fair Finance Watch and others on October 11 filed comments with the Federal Reserve on the 36 branch closings and the anti-competitive effects, also stating that "Fair Finance Watch has reviewed applicant Associated's home purchase lending in the just-out 2016 HMDA data in the Milwaukee MSA and finds serious disparities militating for evidentiary hearings and the denial of this application. For conventional home purchase loans, Associated denied the applications of African Americans 4.16 times more frequently than those of whites; it made 807 such loans to whites and only 41 to African Americans. Even cumulating Table 4-1 loans with Table 4-2, Associated's denial rate disparity in 2016 was 3.71; it made 861 loans to whites and only 48 to African Americans." Now two months later, the Federal Reserve has asked the banks (letter online here on Patreon): "Based on 2017 Summary of Deposits data, the proposed transaction would exceed the concentration thresholds under the Board’s Rules Regarding Delegation of Authority (12 CFR 265.11(c)(11)(v)) and the Department of Justice Bank Merger Competitive Review Guidelines in the Green Bay, Wisconsin banking market (the “Green Bay market”). Specifically, Associated would control approximately 36.6% of deposits in the Green Bay market upon consummation of the proposal. Discuss the effects of the proposed transaction on competition in the Green Bay market, including any factors that would mitigate the potentially adverse competitive effects of the proposal in the Green Bay market." So is the Fed inviting arguments that a 36.6% market share would be fine? We'll have more on this.

December 11, 2017

In DC, Battle for CFPB Continues As English Sues Again, ABA Cheers OCC Undercutting CRA

By Matthew R. Lee

NEW YORK, December 7– The battle for the US Consumer Financial Protection Bureau is not over. Leandra English on December 6 asked U.S. District Judge Timothy J. Kelly of the federal district court in Washington to issue a preliminary and permanent injunction against President Trump that would block his appointment of Office of Management and Budget Director Mick Mulvaney. Meanwhile, the low percentage of banks being given less than satisfactory Community Reinvestment Act rating has become infinitesimal. The Office of the Comptroller of the Currency has signaled that even those few low scores will have no impact.

In a "Policy and Procedures Manual" quietly issued on November 8, with no notice or comment, the OCC says "An overall less than satisfactory CRA rating is not a bar to approval of an application. Rather, the facts and
circumstances of the application must be evaluated as discussed in this PPM." (PPM 6300-2). Now the American Bankers Association has issued a ironically termed white paper congratulating the OCC for this and urging it and the other agencies, including the FDIC for which a Fifth Third lawyer is nominated to become chief, to go even further. We'll have more on this- and this: Seven months after Wells Fargo Bank's CRA rating was dropped two levels to "Needs to Improve," barring it from acquisitions, the Office of the Comptroller of the Currency has quietly said, in a footnote to a Bulletin issued on October 12, that "The OCC’s policy is not to lower a bank’s CRA composite or component rating by more than one rating level." See here, footnote 8. So when did this become the OCC's policy, after it dropped Wells by two levels? Call it a stealth sop to Wells Fargo - and seemingly a violation of the Administrative Procedures Act. We'll have more on this.

December 4, 2017

Trump Taps Fifth Third Bank Lawyer For FDIC Amid OCC Scams on CRA & Sanctions, CFPB

By Matthew R. Lee

NEW YORK, December 1 – Amid the scandal of the Office of the Comptroller of the Currency covering up Sterling Bank's unreliable Community Reinvestment Act data (see below) by withholding most of 400 pages released to Inner City Press under the Freedom of Information (and now trying to strong-arm Inner City Press into scaling back its request), the FDIC is primed to take as its leader the lawyer of Fifth Third Bank, Jelena McWilliams. When Fair Finance Watch asked Fifth Third for its Home Mortgage Disclosure Act data, Fifth Third insisted on only giving the data in paper form, unlike nearly all other banks which gave it electronically. The effect was to make it impossible to analyze patterns in the data, the purpose of the HMDA law. Meanwhile the Consumer Financial Protection Bureau has become a battlefield. In order to run in Ohio, Richard Cordray stepped down at the head of the CFPB, naming as his successor Leandra English. Hours later, Trump issued a statement that "he is designating Director of the Office of Management and Budget (OMB) Mick Mulvaney as Acting Director of the Consumer Financial Protection Bureau (CFPB)." On November 25 the White House held a background press call, on which opposition to the naming of Mulvaney was characterized coming from "blog-posts." Still, the Senior Administration Officials were asked if they plan to have Leandra English removed from the premises. No, was the answer: she should show up at the Deputy. But have they spoken with Ms English? No, was the answer.  On Sunday English filed suit against Mulvany "in his capacity as the person claiming to be the acting director of the CFPB." But a preliminary injunction has been denied. Watch this site. After non-response by the OCC even has it promises merger approvals to banks with Needs to Improve CRA ratings and allows Bank of Tokyo - Mitsubishi to skirt North Korea sanctions review by fast approving applications for which effective public notice was never provided (ICP scoop on notice here), now ICP and CRC have filed suit

November 27, 2017

Amid OCC Scams on Sanctions & CRA, Cordray Taps English, Trump Mulvaney, Showdown?

By Matthew R. Lee

NEW YORK, November 25 – Amid the scandal of the Office of the Comptroller of the Currency covering up Sterling Bank's unreliable Community Reinvestment Act data (see below) by withholding most of 400 pages released to Inner City Press under the Freedom of Information after the nomination of Joseph Otting, formerly of OneWest Bank to be Comptroller, back in July Inner City Press / Fair Finance Watch and the California Reinvestment Coalition submitted this FOIA request. But now, beyond the OCC, the Consumer Financial Protection Bureau has become the battlefield. In order to run in Ohio, Richard Cordray stepped down at the head of the CFPB, naming as his successor Leandra English. Hours later, Trump issued a statement that "he is designating Director of the Office of Management and Budget (OMB) Mick Mulvaney as Acting Director of the Consumer Financial Protection Bureau (CFPB)." On November 25 the White House held a background press call, on which opposition to the naming of Mulvaney was characterized coming from "blog-posts." Still, the Senior Administration Officials were asked if they plan to have Leandra English removed from the premises. No, was the answer: she should show up at the Deputy. But have they spoken with Ms English? No, was the answer. So show down on Monday? Watch this site. After non-response by the OCC even has it promises merger approvals to banks with Needs to Improve CRA ratings and allows Bank of Tokyo - Mitsubishi to skirt North Korea sanctions review by fast approving applications for which effective public notice was never provided (ICP scoop on notice here),

November 20, 2017

Amid OCC Scams on Sanctions & CRA, Withhold Otting Documents, ICP & CRC Sue

By Matthew R. Lee

NEW YORK, November 17 – Amid the scandal of the Office of the Comptroller of the Currency covering up Sterling Bank's unreliable Community Reinvestment Act data (see below) by withholding most of 400 pages released to Inner City Press under the Freedom of Information after the nomination of Joseph Otting, formerly of OneWest Bank to be Comptroller, back in July Inner City Press / Fair Finance Watch and the California Reinvestment Coalition submitted this FOIA request. Now, after non-response by the OCC even has it promises merger approvals to banks with Needs to Improve CRA ratings and allows Bank of Tokyo - Mitsubishi to skirt North Korea sanctions review by fast approving applications for which effective public notice was never provided (ICP scoop on notice here), now ICP and CRC have filed suit, stating "No formal response was ever received from the OCC in response to Plaintiffs’ FOIA Request. To date, the OCC has not disclosed any records responsive to Plaintiffs’ FOIA Request nor has sent any correspondence to Plaintiffs informing
them of the OCC’s need for an extension of time to process the FOIA Request. As of November 10, 2017, Plaintiffs’ FOIA Request was listed as 'In Process' on the OCC’s FOIA request portal... Defendant has far exceeded the 20-working day statutory time limit for the processing of FOIA requests, as required by 5 U.S.C. § 552(a)(6)(A).
12. Plaintiffs have a statutory right to the records sought in its requests... WHEREFORE, Plaintiff prays for relief as follows: A. Order Defendant to conduct a reasonable search for all records responsive to Plaintiffs’ FOIA Request, and to immediately disclose all records or portions of records responsive to the FOIA Request in their entirety that are non- exempt; B. Issue a declaratory judgment that Plaintiffs are entitled to disclosure of the records responsive to Plaintiffs’ FOIA Request; C. Enjoin Defendant from continuing to withhold responsive, non-exempt records or portions of records from Plaintiffs; D. Provide for expeditious proceedings of this action... Dated: November 17, 2017 By: s/ James H. Kaster." Watch this site. As to Otting, beyond his gaming of the CRA system, another problem has arisen: Otting misrepresented his resume on education. He listed a degree on his resume from the "School of Credit and Financial Management at Dartmouth College." It's a fraud. "Joseph Otting is not a Dartmouth graduate," Dartmouth spokeswoman Diana Lawrence said. "Dartmouth does not have a school of credit and financial management." In turns out the school is a four-week program spread over two years, which rented space from Dartmouth. It's not only Sterling's CRA data is an unreliable. While at OneWest, as reported by Inner City Press in 2015, Otting was best know for trying to get his own employees, fundees and investors to submit comments to the OCC to support OneWest's purchase by CIT.  Click here. Otting wrote: From: Otting, Joseph M [at] owb.com
Sent: Wednesday, January 07, 2015 5:00 PM
Cc: Haas, Alesia Jeanne; Tran, Cindy; Kim, Glenn
Subject: Support For OneWest Bank
 
Dear Friends,
 
We were excited to announce on July 21, 2014, that IMB HoldCo LLC, the parent company of OneWest Bank entered into a merger agreement with CIT Group Inc. As part of the applications for regulatory approval of the transaction, our regulators are interested in the perspectives of the public. We are writing you to seek your support of the Bank and pending merger. This merger, if approved, would create the largest bank headquartered in Southern California with a full suite of banking products and services, which will allow us to better serve our customers. We would retain and grow jobs and are committed to continuing and expanding our efforts to serve the economic and development needs of our community. I would like to ask you to take a moment to click on the link below and submit a letter of support adding any of your own words or thoughts.
 
Please submit your letter by clicking here, or by visiting our website at www.OneWestBank.com/merger-support (if the link isn't clickable or part of the link is cut off, please copy and paste the entire URL into your browser's address bar and press Enter)
 
Thank you for your support.  Best wishes for a successful 2015 and please call on me if I can ever be of assistance.
 
Joseph M. Otting
President and CEO
OneWest Bank N.A.
888 East Walnut Street
Pasadena, CA 91101

  Inner City Press and the California Reinvestment Coalition, both members of the National Community Reinvestment Coalition (NCRC) will have more on this.

November 13, 2017

And now a new outrage at the OCC:  "An overall less than satisfactory CRA rating is not a bar to approval of an application. Rather, the facts and circumstances of the application must be evaluated as discussed in this PPM." With grade inflation, very very few banks get less than satisfactory ratings. And now at the OCC, even that hardly matters. https://occ.gov/publications/publications-by-type/other-publications-reports/ppms/ppm-6300-2.pdf We'll have more on this. 

November 6, 2017

BancorpSouth, after settling redlining charges, has escaped Federal Reserve regulation, announcing on Oct 31 it has approvals from the "Federal Deposit Insurance Corporation and the Mississippi Department of Banking and Consumer Finance... to improve efficiency through the elimination of redundant corporate infrastructure and duplicative regulatory oversight." Meanwhile in Montana, Glacier Bancorp proposes acquiring First Security Bank - a combination which would control 35% of the local Bozeman banking market...

October 30, 2017

Shameful: Mid America Bank and Trust Company has a Needs to Improve CRA rating but was allowed to pay $5 million and get acquired by Reliable Community Bancshares. Impunity.

October 23, 2017

Wells Fargo Was Dropped 2 Levels by OCC, Which Now Says Only 1 Level Is Its Policy, Sop

By Matthew R. Lee

NEW YORK, October 21 – Seven months after Wells Fargo Bank's Community Reinvestment Act rating was dropped two levels to "Needs to Improve," barring it from acquisitions, the Office of the Comptroller of the Currency has quietly said, in a footnote to a Bulletin issued on October 12, that "The OCC’s policy is not to lower a bank’s CRA composite or component rating by more than one rating level." See here, footnote 8. So when did this become the OCC's policy, after it dropped Wells by two levels? Call it a stealth sop to Wells Fargo - and seemingly a violation of the Administrative Procedures Act. We'll have more on this. In July it emerged that over 800,000 people who took car loans from Wells were charged for needless auto insurance, pushing 274,000 Wells Fargo customers into delinquency and triggering nearly 25,000 wrongful vehicle repossessions. So much for the industry having cleaned itself up after the predatory lending meltdown.

October 16, 2017

Inner City Press / Fair Finance Watch filed: "This is a timely first comment opposing and requesting an extension of the FRB's public comment period on the Applications by Associated Banc-Corp to merge with Bank Mutual Corporation, Milwaukee, Wisconsin and acquire Bank Mutual. The Fed has received many substantive comments on this application and should hold public hearings, including on the prospective impacts of the 36 branches that Associated would close or consolidate. See, http://www.jsonline.com/story/money/2017/09/01/branch-network-pared-36-locations-associated-bank-takes-over-bank-mutual/624805001/

Fair Finance Watch has reviewed applicant Associated's home purchase lending in the just-out 2016 HMDA data in the Milwaukee MSA and finds serious disparities militating for evidentiary hearings and the denial of this application. For conventional home purchase loans, Associated denied the applications of African Americans 4.16 times more frequently than those of whites; it made 807 such loans to whites and only 41 to African Americans. Even cumulating Table 4-1 loans with Table 4-2, Associated's denial rate disparity in 2016 was 3.71; it made 861 loans to whites and only 48 to African Americans. This is outrageous. On the current record, these applications should not be approved."

October 9, 2017

In Puerto Rico, Disparate Bank Lending, Predatory Investors, UN's Maria Photo Ops

By Matthew Russell Lee

PUERTO RICO, October 3 – The UN system's International Monetary Fund has yet to announce any debt moratorium for countries impacted by the recent hurricanes, and despite photo op trips by those who could speak to and of the IMF, nothing is changing. Most holders of Puerto Rico's debt are doing nothing to help. Even in 2016 before Hurricane Maria, according to Home Mortgage Disclosure Act data just released, Banco Santander Puerto Rico made 88 conventional home purchase loans in upper income tracts in the San Juan MSA, 50 in middle income tracts, seven in moderate income tracts and NONE in low-income census tracts. Citibank made a single large loans in San Juan, for a multi-family apartment building. The UNironically named Whitebox Advisors, which has sued on Puerto Rico debt, has "a policy of not discussing Puerto Rico." We don't. Watch this site. Back on September 18 UN Secretary General Antonio Guterres' spokesman Stephane Dujarric gave the press a mere three minutes to sign up to attend the UN's meeting about Irma, see below. As the meeting began, Inner City Press asked not Dujarric but the spokesman for the President of the General Assembly for the PGA's view of the IMF's position on (no) debt moratorium. From the PGA Office's summary: "Asked for the President’s reaction to comments by an International Monetary Fund (IMF) official, in which the official allegedly said that the IMF would not be open to instituting a debt moratorium for hurricane-hit Antigua and Barbuda, the Spokesperson replied that the President would not want to second-guess the comments of an IMF official in an area of the IMF’s expertise. The Spokesperson reiterated that the President was committed to the recovery of Antigua and Barbuda, which is why he had convened the high-level meeting on Hurricane Irma and invited the Government of Antigua and Barbuda to speak there." In the meeting, Achim Steiner of UNDP told even Caribbean nations they could not speak, so that Robert De Niro could. You talkin' to me? When the IMF re-started its biweekly embargoed press briefings on September 14, Inner City Press submitted a question about Hurricane Irma and moratoria: "On Antigua and Barbuda, and Hurricane Irma impacted countries more generally... will there be no moratoria? What is the IMF doing?" IMF spokesperson Gerry Rice said, "There's a question from Matthew Lee on moratorium... on that, I would refer to what Mme Lagarde said a few days ago, of course the IMF has tremendous sympathy. She also said we stand ready to help. There are a number of options we can look at in that context. At the moment we are still trying to make an assessment. As a factual member, none of our members including Antigua and Barbuda have formally requested assistance from the Fund." Oh. On September 15, when Inner City Press at the UN asked Patti Smith about it, UN spokesman Stephane Dujarric cut off the question saying he would answer it at his forthcoming briefing. He did not.

October 2, 2017

  While there are many toxic proposed bank mergers across the USA, the proposed in-market Wisconsin combination of Associated and Bank Mutual which would close branches is our focus this week - more than 300 comments filed, with the Federal Reserve comment period open until October 11 -- fire away!

September 25, 2017

South State Corporation, to the Federal Reserve, is making excuses for its record in the Atlanta MSA, and trying to withhold obviously public information. We'll have more on this.

September 18, 2017

Inner City Press / Fair Finance Watch has filed a second comment against SoFi getting into banking: "On behalf of Inner City Press / Fair Finance Watch, this is a second comment on the application by fintech company SoFi to open an FDIC-insured industrial bank in Utah, to limited its CRA assessment area to (part of) Utah while project business nationwide, and to claim that a secure credit card with interest rate north of 20% is a CRA program. We request public hearings and denial of the application, including now on the basis of the ouster of the CEO and the abuses that have come to light, including but not only financial abuses. See, for the record, https://mobile.nytimes.com/2017/09/12/technology/sofi-chief-executive-toxic-workplace.html

Yet Mr. Cagney’s position had become increasingly delicate after the filing of the sexual harassment suit, which accused him of “empowering other managers to engage in sexual conduct in the workplace.”

His situation was also exacerbated by claims about his approach to SoFi’s business, which uses money from Wall Street investors to fund student loans, personal loans and mortgages. At several points, Mr. Cagney ignored warnings from colleagues that he was being too aggressive with the business, according to more than a dozen employees who were involved in the conversations.

That included a time when Mr. Cagney decided to put customer service representatives in charge of lending determinations, despite them having no experience in the area. Another time, he told investors that SoFi had $90 million in debt financing for a loan product; the company did not in fact have the money, according to the internal emails reviewed by The Times.

SoFi’s board, which includes representatives of Japanese conglomerate SoftBank and the influential hedge fund Third Point Capital, now faces questions about whether it needed more checks and balances on Mr. Cagney.

Companies like SoFi show how boards are incentivized to prioritize cash flow and growth over governance, said David F. Larcker, a professor at Stanford University’s Graduate School of Business who specializes in corporate governance. “The board now has a duty to correct for things that have gone wrong,” he said.”

This application should not - cannot - be approved.

As you know, the drive by fintech companies to get into banking is a matter of controversy, with the OCC have proposed a new type of charter. This end run would set a bad precedent, of gerrymandered CRA and even predatory lending as CRA."


September 11, 2017

On Synovus - Cabela, Fed Rubber Stamps Despite "Confidential Matter," Cap One Scam

By Matthew R. Lee, Full Doc on Patreon Here

NEW YORK, September 6 – Two months after Inner City Press reported Capital One failing in its proposal to acquire Cabela's "World's Foremost Bank," a way to try to avoid the regulators and Capital One's Community Reinvestment Act record emerged. The scam involves Synovus buying the bank then passing one the credit card receivables to Capital One, while keeping the deposits, so Capital One wouldn't be reviewed under CRA. The Fair Finance Watch has opposed this, in a filing to the Federal Reserve, below. And the Federal Reserve has, with all formality, informed Fair Finance Watch and Inner City Press of a July 21 meeting with Synovus, to discuss a "confidential supervisory matter," Fed "memo to file, on Patreon here. But on September 6, covering up the supervisory matter and with Stanley Fischer leaving, the Fed approved the deal, stating among other things that "Commenters alleged that the proposal has been structured to evade the requirements of the Bank Merger Act. Commenters also object to the involvement of Capital One Bank in the transaction, alleging that Capital One Bank has managerial weaknesses and deficiencies in its compliance and anti-money-laundering programs. Capital One Bank is a national bank; the Office of the Comptroller of the Currency (“OCC”), and not the Board, determines whether a combination resulting in a national bank requires prior approval under the Bank Merger Act. The Board has consulted with the OCC in connection with this proposal and understands that the OCC does not object to Capital One Bank’s acquisition of the credit-card loans and related assets and assumption of nondeposit liabilities of World’s Foremost Bank from Synovus Bank."This transaction is a fraud. We'll have more on this.

September 4, 2017

Federal Reserve Asks South State 5 Park Sterling Qs, Here, After ICP/Fair Finance Watch Protest

By Matthew R. Lee, on Patreon, here

SOUTH BRONX USA, September 1 -- Three weeks ago Fair Finance Watch challenged to the Federal Reserve the application by South State to acquire Park Sterling, under the US Community Reinvestment Act. Today September 1 the Federal Reserve asked South State, or its lawyers at Wachtell, Lipton, Rosen & Katz, five questions and told them to send their answers to Fair Finance Watch (Inner City Press will request, under FOIA and otherwise, withheld relevant portions). Here and attached are the Federal Reserve's question, followed by FFW's August 10 challenge:

 September 1, 2017

Jeffrey A. Watiker, Esq. Wachtell, Lipton, Rosen & Katz 51 West 52nd Street New York, New York 10019-6150

Dear Mr. Watiker: This correspondence is in connection with the application by South State Corporation (“SSC”), Columbia, South Carolina, requesting the prior approval of the Board of Governors of the Federal Reserve System (“Board”) to acquire Park Sterling Corporation (“PSC”) and thereby indirectly acquire Park Sterling Bank, both of Charlotte, North Carolina, pursuant to section 3 of the Bank Holding Company Act, as amended. In connection with that application, Federal Reserve staff requests the following additional information. Supporting documentation, as appropriate, should be provided.

1. Describe in greater detail any expected benefits to the communities currently served by SSC and PSC as a result of the proposed transaction, including any specific new products and services that would be made available to customers of SSC and/or PSC. Please also describe any plans to retain products or services offered by PSC after consummation.

 2. Provide a description of any due diligence conducted by SSC regarding convenience and needs and CRA with respect to the communities currently served by Park Sterling Bank, such as: a. SSC’s ascertainment of any identified needs relating to credit and/or deposit products or services; b. SSC’s plans to offer products or services that address the financial service or credit needs of the communities currently served by Park Sterling Bank. c. SSC’s plans to conduct marketing or outreach in the communities presently served by Park Sterling Bank upon consummation of the proposal.

3. In its August 22, 2017 letter (“August Letter”) to the Federal Reserve Bank of Richmond, SSC represented that its presence in the Atlanta MSA was the result of the acquisition of failed financial institutions in 2011 and that SSC “has continued to rebuild the reputation of the branches in the area, establish the South State brand, and expand outreach.” Please provide a more detailed discussion of any specific steps SSC has taken to increase its activity in the market and any plans for increasing its activity as it becomes more established in the market. Please include any efforts and/or plans related to marketing and outreach to minority and low- or moderate-income individuals and census tracts in the Atlanta MSA.

4. In the August Letter, SSC also described various affordable home mortgage programs it offers or in which it participates. For each of those programs, please provide the number of loans originated or individuals that were provided assistance for 2015 and 2016.

5. Discuss any pending or recently resolved litigation by private parties or regulators and investigations by regulators, including, but not limited to, those pertaining to consumer protection laws and regulations against SSC or PSC.

Please address your responses within eight business days to Kathy Eike at the Federal Reserve Bank of Richmond. In addition, in accordance with the Federal Reserve’s ex parte procedures, provide a copy of the public portion of your response (together with any attachments) directly to the commenter, Matthew Lee of Fair Finance Watch. Any information for which you desire confidential treatment should be so labeled and separately bound in accordance with the Board’s rules regarding confidential treatment of information at 12 CFR 261.15. 
August 28, 2017

Watchdogging Fair Lending Evasion, FFW Challenges Redliner BancorpSouth at FDIC

By Matthew Russell Lee

South Bronx, New York, August 26 – The lack of seriousness in US bank regulation, the mechanical repeating of whatever a challanged bank says, is exemplified by the application by BancorpSouth, which Inner City Press / Fair Finance Watch challenged on disparities and which settled racial redlining charges, to drop its Federal Reserve charter and evade regulation. Now ICP/FFW has timely protested that application to the FDIC: "Dear Regional Director Elmquist, Ass't Regional Director Finnegan and others at the FDIC: "This is a first timely comment opposing, requesting hearings and an extension of the comment period on BancorpSouth's cynical application to evade regulation after its redlining and settlement. Inner City Press / Fair Finance Watch protested the applications of BancorpSouth to merge with Ouachita Bancshares Corporation and thereby indirectly acquire Ouachita Independent Bank, and with Central Community Corporation, and thereby indirectly acquire First State Bank Central Texas, Austin, Texas. - based on racial discrimination in lending... Now BancorpSouth makes this application, and its CEO Dan Rollins states that it wants to “alleviate... regulatory oversight,” and become the “only state-chartered bank not a part of the Federal Reserve system.” We oppose this cynical evasion, particularly by one of the few banks having settled redlining charges. Let's compare: reviewing the 2015 HMDA data released by the FFIEC, ICP examined BancorpSouth's conventional home purchase lending in the Jackson, Mississippi and Baton Rouge, Louisiana and finds them troubling. In 2015 in the Jackson MS MSA for conventional home purchase loans, BancorpSouth made 346 loans to whites, only 53 to African Americans. BancorpSouth's denial rate for whites was 7% while for African Americans it was 19% -- 2.71 times higher. This was troubling. In 2015 in the Baton Rouge LA MSA for conventional home purchase loans, BancorpSouth made 47 such loans to whites and NONE to African Americans, even less than the three it made in 2012. BancorpSouth has grown more disparate. ICP is requesting evidentiary hearings and that this proposed acquisition, on the current record, not be approved. There is no public benefit."

August 21, 2017

  Inner City Press / Fair Finance Watch has filed this: This is a timely first comment opposing and requesting an extension of the FRS's public comment period on the Application by South State Corporation to acquire Park Sterling Corporation, and thereby indirectly acquire Park Sterling Bank.

Fair Finance Watch has reviewed applicant South State's home purchase lending in three MSAs in three states - its heardquarters in Colombia SC, the targets Charlotte NC, and Atlanta GA - and finds serious disparities militating for evidentiary hearings and the denial of this application.

And, significantly, the specifics of which branches would be closed have not been publicized.

In the Atlanta, Georgia MSA in 2015 for home purchase loans, South State denied the applications of African Americans and Latinos 4.23 times more frequently than the applications of whites. Its lending did not reflect the market or other lenders: 54 home purchase loans to whites, only two to Latinos, and only ONE to an African American applicant. This is disparate.

In the Colombia SC MSA in 2015 for home purchase loans, South State denied the applications of African Americans 2.79 times more frequently than the applications of whites, and denied the applications of Latinos' 3.75 times more frequently than whites. Its lending did not reflect the market or other lenders: 179 home purchase loans to whites, only ten to African Americans and only one to a Latino applicant. This is disparate.

In the Charlotte NC MSA for home purchase loans in 2015, South State denied the applications of African Americans 2.22 times more frequently than the applications of whites, and denied the applications of Latinos' 6.58 times more frequently than whites. Its lending did not reflect the market or other lenders: 382 home purchase loans to whites, only thirteen to African Americans and only four to Latino applicants. This is disparate, and a pattern militating for evidentiary hearings and the denial of this application.

Meanwhile, see http://www.gastongazette.com/news/20170728/park-sterling-bank-head-says-merger-will-bring-little-fallout-for-gaston-employees: “employees in any branch that closes or is affected might have to relocate to keep their job, to places, for example, such as Charleston, South Carolina... Since last year, Park Sterling had been carrying out a local expansion that involved consolidating back-office operations and bringing jobs from South Carolina to Gastonia. Cherry said their branches on Main Avenue and South New Hope Road have seen the effects of that, and one of the decisions essentially made prior to the announced merger was to close the Main Avenue branch. 'It has limited hours and is really just handling commercial customers,' said Cherry. 'That was likely going to be closed as a result of our moves beforehand.'” South State should be asked for information and criteria about the closings and the comment period must be extended to allow entry of this information into the record and to allow comment thereon.

On the current record, hearings should be held and the application(s) should not be approved. The comment period must be extended.

August 14, 2017

  People should comment on the CFPB collecting and releasing small business lending data: https://www.regulations.gov/comment?D=CFPB-2017-0011-0017

August 7, 2017

  Inner City Press / Fair Finance Watch last week filed this: "This is a timely first comment opposing and requesting an extension of the FRS's public comment period on the Application by Sandy Springs Sandy Spring Bancorp to acquire WashingtonFirst Bankshares, WashingtonFirst Bank and lst Portfolio, Inc., Fairfax, Virginia.

These transaction raises troubling Community Reinvestment Act issues. Sandy Spring has a disparate lending record, as does WashingtonFirst.

And, significantly, the specifics of which branches would be closed have not been made public, see below. The comment period must be extended.

In the Baltimore MSA in 2015 for home purchase loans, Sandy Spring denied the applications of African Americans TWENTY TWO times more frequently than the applications of whites. For refinance loans in the Washington MSA, Sandy Spring denied the applications of African Americans 8.8 times more frequently than the applications of whites. In the Washington DC MSA in 2015 for home purchase loans, Sandy Spring denied the applications of African Americans 2.8 times more frequently than the applications of whites.

In the Washington DC MSA for home purchase loans in 2015, WashingtonFirst made 13 loans to whites and NONE to African Americans or Latinos (there were similar zeroes for people of people for home improvement loans).

Meanwhile, see http://wtop.com/business-finance/2017/05/sandy-spring-buying-washingtonfirst-becoming-largest-locally-based-community-bank/: “Sandy Spring said there will be branch closings as part of the merger, though it says it is too soon to determine where overlap will require closings.” That is not acceptable: Sandy Springs should be asked for information and criteria about the closings and the comment period must be extended to allow entry of this information into the record and to allow comment thereon."

July 31, 2017

Amid Fed & OCC Sterling CRA Scam, Otting & Quarles In Senate July 27, ICP & CRC FOIA

By Matthew R. Lee, New Platform

NEW YORK, July 26 – Amid the scandal of the Federal Reserve and Office of the Comptroller of the Currency covering up Sterling Bank's unreliable Community Reinvestment Act data (see below) by withholding most of 400 pages released to Inner City Press under the Freedom of Information this month, in advance of the July US Senate hearing on the nominations of Joseph Otting, formerly of Bank of America, Union Bank, US Bancorp and OneWest to be Comptroller and of Randal Quarles formerly of the Carlyle Group to head the Fed's Supervision unit, Inner City Press / Fair Finance Watch and the California Reinvestment Coalition submitted this FOIA request.

While still awaiting any of the responsive documents, on July 26 the Federal Reserve asked Sterling to "Please provide an update on Sterling Bank's CRA activities since its last CRA Performance Evaluation in January 2017 in every banking market in which the bank operates, including any significant CRA initiatives undertaken, particularly with respect to credit and deposit products and retail banking services targeted toward LMI and minority geographies and individuals." What about the unreliable data already submitted? As to Otting, beyond his gaming of the CRA system, another problem has arisen: Otting misrepresented his resume on education. He listed a degree on his resume from the "School of Credit and Financial Management at Dartmouth College." It's a fraud. "Joseph Otting is not a Dartmouth graduate," Dartmouth spokeswoman Diana Lawrence said. "Dartmouth does not have a school of credit and financial management." In turns out the school is a four-week program spread over two years, which rented space from Dartmouth. It's not only Sterling's CRA data is an unreliable. While at OneWest, as reported by Inner City Press in 2015, Otting was best know for trying to get his own employees, fundees and investors to submit comments to the OCC to support OneWest's purchase by CIT.  Click here.

July 24, 2017


While Fed & OCC Paper Over Sterling's CRA Scam, Otting & Quarles In Senate July 27

By Matthew R. Lee, New Platform

NEW YORK, July 22 – Amid the scandal of the Federal Reserve and Office of the Comptroller of the Currency covering up Sterling Bank's unreliable Community Reinvestment Act data by withholding most of 400 pages released to Inner City Press under the Freedom of Information this month, on July 27 the US Senate will take up the nominations of Joseph Otting, formerly of Bank of America, Union Bank, US Bancorp and OneWest to be Comptroller and of Randal Quarles formerly of the Carlyle Group to head the Fed's Supervision unit. What would it portend for evasions by Sterling and larger banks?  Beyond Otting's gaming of the CAR system, another problem has arisen: Otting misrepresented his resume on education. He listed a degree on his resume from the "School of Credit and Financial Management at Dartmouth College." It's a fraud. "Joseph Otting is not a Dartmouth graduate," Dartmouth spokeswoman Diana Lawrence said. "Dartmouth does not have a school of credit and financial management." In turns out the school is a four-week program spread over two years, which rented space from Dartmouth. It's not only Sterling's CRA data is an unreliable. While at OneWest, as reported by Inner City Press in 2015, Otting was best know for trying to get his own employees, fundees and investors to submit comments to the OCC to support OneWest's purchase by CIT.  Click here. Otting wrote: From: Otting, Joseph M [at] owb.com
Sent: Wednesday, January 07, 2015 5:00 PM
Cc: Haas, Alesia Jeanne; Tran, Cindy; Kim, Glenn
Subject: Support For OneWest Bank
 
Dear Friends,
 
We were excited to announce on July 21, 2014, that IMB HoldCo LLC, the parent company of OneWest Bank entered into a merger agreement with CIT Group Inc. As part of the applications for regulatory approval of the transaction, our regulators are interested in the perspectives of the public. We are writing you to seek your support of the Bank and pending merger. This merger, if approved, would create the largest bank headquartered in Southern California with a full suite of banking products and services, which will allow us to better serve our customers. We would retain and grow jobs and are committed to continuing and expanding our efforts to serve the economic and development needs of our community. I would like to ask you to take a moment to click on the link below and submit a letter of support adding any of your own words or thoughts.
 
Please submit your letter by clicking here, or by visiting our website at www.OneWestBank.com/merger-support (if the link isn't clickable or part of the link is cut off, please copy and paste the entire URL into your browser's address bar and press Enter)
 
Thank you for your support.  Best wishes for a successful 2015 and please call on me if I can ever be of assistance.
 
Joseph M. Otting
President and CEO
OneWest Bank N.A.

July 17, 2017

While Federal Reserve Papers Over Sterling's CRA Scam, Quarles Nominated as to Board

By Matthew R. Lee, New Platform

NEW YORK, July 10 – Amid the scandal of the Federal Reserve's covering up Sterling Bank's
unreliable Community Reinvestment Act data by withholding most of 400 pages released to Inner City Press under the Freedom of Information last week, on the evening of July 10 Randal Quarles formerly of the Carlyle Group was nominated to head the Fed's Supervision unit. What would it portend for evasions by Sterling and larger banks? The other shoe still hasn't dropped on / for Marvin Goodfriend... Meanwhile amid the scandal of the US Office of the Comptroller of the Currency covering up Sterling's data by quickly issuing a Satisfactory CRA rating, on June 5 a new head of the OCC was nominated: Joseph Otting, previously of OneWest Bank. Now beyond Otting's gaming of the CAR system, another problem has arisen: Otting misrepresented his resume on education. He listed a degree on his resume from the "School of Credit and Financial Management at Dartmouth College." It's a fraud. "Joseph Otting is not a Dartmouth graduate," Dartmouth spokeswoman Diana Lawrence said. "Dartmouth does not have a school of credit and financial management." In turns out the school is a four-week program spread over two years. The White House now syas this characterization of Mr. Otting’s credentials is correct. So who will be Comptroller of the Currency? While at OneWest, as reported by Inner City Press in 2015, Otting was best know for trying to get his own employees, fundees and investors to submit comments to the OCC to support OneWest's purchase by CIT.  Click here.

July 10, 2017

Regulators Said Sterling's CRA Data Unreliable, Under FOIA Fed Blacks-Out Most of 400 Pages

By Matthew R. Lee, New Platform

NEW YORK, July 8 – Sterling Bank, which is applying for approvals to acquire Astoria Bank, is known by its regulators to have filed unreliable Community Reinvestment Act data from at least 2014 through 2016, a document obtained by Inner City Press shows. The story, and outrage, was picked up by the American Banker newspaper here, by Paul Davis and Allison Prang, crediting Inner City Press - and Sterling Bank had no comment. Inner City Press immediately on May 13 submitted a Freedom of Information Act request to the Federal Reserve. The Fed repeatedly extended its time to respond then finally on July 7 provided more than 400 pages - almost entirely redacted. All references to the unreliable CRA data (and needs to improve rating) have been redacted. Sample here; the rest on Patreon, here. Inner City Press immediately submitted a FOIA appeal: "Amazingly, despite taking seven weeks to respond to ICP's immediate FOIA request, all information about this consumer compliance / CRA issue has been redacted from the records produced. CRA and CRA data are presumptively of public interest and public impact. The redacted response implies that the public could be entirely excluded from the FRS' review of this important CRA issues. It is unacceptable and inconsistent with the purpose, spirit and letter of FOIA. ICP is hereby appealing each and every redaction in the records belated provided to ICP on July 7. This should be ruled on before the comment period closed; the comment period should be extended." Watch this site.

July 3, 2017

Regulators Said Sterling's CRA Data Unreliable, Now Admits Needs to Improve 2017, Denial?

By Matthew R. Lee, New Platform

NEW YORK, July 1 – Sterling Bank, which is applying for approvals to acquire Astoria Bank, is known by its regulators to have filed unreliable Community Reinvestment Act data from at least 2014 through 2016, a documentobtained by Inner City Press shows. The story, and outrage, has been picked up by the American Banker newspaper here, by Paul Davis and Allison Prang, crediting Inner City Press - and Sterling Bank had no comment. Instead, Sterling's outside counsel Wachtel Lipton chose to snail-mail its response to the wrong address, and not e-mail it to Fair Finance Watch. Via here, with envelope re-submitted to Fed and OCC. Now another snail-mailed response from Sterling's Wachtel, which we've put online here on Patreon: "Please see Exhibit 1 and Confidential Exhibit C" -- Inner City Press has now requested it under FOIA, but the agencies have already repeatedly extended their time. This is a scam. But crucially, even Wachtel says "Sterling did receive a Needs to Improve rating for the State of New York in Sterling Bank's most recent CRA Performance Evaluation dated January 18, 2017." We'll have more on this - the application must be denied. The OCC has now put up a roadblock to releasing the records Inner City Press has requested under the Freedom of Information Act, writing: "The purpose of this letter is to seek additional information pertaining to your recent request for information from the Office of the Comptroller of the Currency. Your request dated May 13, 2017 was received in my office on May 15, 2017. You requested any and all records related to Sterling Bank's application(s) to acquire Astoria and Sterling Bank's CRA data. Upon further review, we determined that we need clarification on the date range for search of Sterling Bank’s CRA data. If I have not received this information by COB June 19th I will assume that you no longer seek this information and consider your request closed." Inner City Press has responded: "   In response to Inner City Press' now month-old FOIA request concerning the CRA data the OCC knew and knows to be unreliable, you have asked that by June 19 ICP specify the date range for the request. While not understanding the OCC's delay in requesting this, we hereby timely specify that the date range is from three years ago to the date of your response. Please confirm receipt of this (including explaining your letter since you wrote “we need clarification on the date range for search”) and please provide the records as we intend to comment on them, for obvious reasons. Thank you." Meanwhile, Sterling's lawyers at Wachtell Lipton chose to snail mail their response to Fair Finance Watch, putting it in the mail three days after it was dated (now online via Patreon here.) How did it take the OCC a full MONTH to come up with its request? Why was the response snail mailed? This while the Federal Reserve has granted Inner City Press' request for expedited treatment of its FOIA request for all records, promising the responsive documents by June 1. But then the Fed, in a June 1 letter, unilaterally extended its time to June 22. First Fed letter on Scribd, here.

June 26, 2017

Some mergers we're looking at, and aftermath(s):

Carolina Financial Corporation announced a proposal to acquire First South Bancorp and First South Bank;

June 12: Texas: Southside Bancshares announced a proposal to acquire Diboll State Bancshares, Inc., the holding company for Diboll, Texas-based First Bank & Trust East Texas;

June 7: New Jersey: BCB Bancorp announced a proposal to acquire IAB and its wholly owned subsidiary, Indus-American Bank;

June 6, Montana into Colorado: Glacier Bancorp announced a proposal to acquire Columbine Capital Corp. and  Collegiate Peaks Bank, a community bank based in Buena Vista, Colorado;

June 5, Pennsylvania: : Penn Community Bank announced a proposal to acquire Chelten Hills Savings Bank, of Abington.

May 31, Utah: People's Utah Bancorp announced a proposal to acquire Town & Country Bank, based in St. George Utah...

"Chase reduced its branch presence by 190 locations, a 3.4 percent decline, from 2012 to 2016. Wells Fargo closed 98 branches, a 1.6 percent decline in the same period. Its peers are even more aggressive. Bank of America closed 243 branches (16 percent) in that period and Citi closed 302 (28.5 percent)." 

June 19, 2017

As SoFi Applies For Bank, FFW Opposes Evasion, Interest Rate North of 20%, FinTech

By Matthew R. Lee, New Platform

NEW YORK, June 15 – As the fintech industry in the US tries to move into banking, either through a new charter or, like SoFi, an end-run using the Utah industrial bank loophole, Fair Finance Watch and others are raising issues. Fair Finance has commented to the FDIC, and Inner City Press made requests citing FOIA: "Re: Timely Opposition to the Application by FinTech Company SoFi to Open a Bank, Including Offering a Secured Credit Card at Upward of 20% interest and trying to limited CRA to Utah
To the Addressees at the FDIC:
  On behalf of Inner City Press / Fair Finance Watch, this is a timely comment on the application by fintech company SoFi to open an FDIC-insured industrial bank in Utah, to limited its CRA assessment area to (part of) Utah while project business nationwide, and to claim that a secure credit card with interest rate north of 20% is a CRA program. We request public hearings and denial of the application.
   As you know, the drive by fintech companies to get into banking is a matter of controversy, with the OCC have proposed a new type of charter. This end run would set a bad precedent, of gerrymandered CRA and even predatory lending as CRA.
  The application - with portions apparently withheld that should be released under FOIA and now whatever ex-parte rules the FDIC has - states twice that “the bank will offer a secured credit card utilizing its credit card and deposit infrastructure to the LMI community and the    members with a 'shallow credit' file [with] the following features... a much higher interest rate north of 20% percent.”  This is outrageous.
  For the record, also in support of the public hearing request, from the WSJ: “the entire sector is in trouble. Growth has slowed dramatically because of deeper worries about consumer-loan defaults and shifting preferences among some investors for other kinds of debt. Some of the largest online lenders have cut jobs, with Avant Inc. and Prosper Marketplace Inc. shrinking their number of employees by more than 25%. Confidence also was bruised badly when LendingClub pushed out its chief executive in May because of a scandal involving fabricated loan data. In the second quarter, venture-capital investments into lending startups fell by nearly half from a year earlier.. SoFi itself stumbled when consumers flooded its website after the lender ran an ad during the Super Bowl in February. Applicants who didn’t hear from SoFi for days blasted it in online ratings.”
Ready for prime time and FDIC insurance?
  Again, we request public hearings, and on the current record the denial of SoFi's application."

June 12, 2017

While OCC Papers Over Sterling's CRA Scam, Otting Nominated as Head, Resume Fraud

By Matthew R. Lee, New Platform

NEW YORK, June 10 – Amid the scandal of the US Office of the Comptroller of the Currency covering up Sterling National Bank's unreliable Community Reinvestment Act data by quickly issuing a Satisfactory CRA rating, on June 5 a new head of the OCC was nominated: Joseph Otting, previously of OneWest Bank. Now beyond Otting's gaming of the CAR system, another problem has arisen: Otting misrepresented his resume on education. He listed a degree on his resume from the "School of Credit and Financial Management at Dartmouth College." It's a fraud. "Joseph Otting is not a Dartmouth graduate," Dartmouth spokeswoman Diana Lawrence said. "Dartmouth does not have a school of credit and financial management." In turns out the school is a four-week program spread over two years. The White House now syas this characterization of Mr. Otting’s credentials is correct. So who will be Comptroller of the Currency? While at OneWest, as reported by Inner City Press in 2015, Otting was best know for trying to get his own employees, fundees and investors to submit comments to the OCC to support OneWest's purchase by CIT.  Click here.

June 5, 2017

Wells Fargo Gets Cut Off from New NYC Business After CRA Downgrade, Sterling Next?

By Matthew R. Lee

WASHINGTON, May 31– Two months after Wells Fargo Bank's Community Reinvestment Act rating was dropped to "Needs to Improve," barring it from acquisitions, New York City announced it will not enter any new relationships with the bank, also suspending Wells Fargo's role as a senior book-running manager for NYC General Obligation and Transactional Finance Authority bond sales. A statement by Mayor Bill de Blasio and Controller Scott Stringer noted that "Currently, Wells Fargo holds contracts with the City to provide banking services, including to operate 'Lock Box' services that hold taxes and fees collected by the City. There is approximately $227 million of City dollars held in Wells Fargo accounts." Bu will they get involved in opposing Sterling National Bank, which Inner City Press and Fair Finance Watch have exposed as having "unreliable" CRA data, notwithstanding the OCC's scam "Satisfactory" rating on May 30? Click here. We'll have more on this. Back in late March, the bank settled for $110 million a class action lawsuit for having opened fake accounts without customers' knowledge or approval. But will Wells Fargo, which Inner City Press has covered through its acquisition of First Union and even before, from Washington to Alaska, still be allowed to go forward with its reported plan to close 400 bank branches, including in low and moderate income areas? The question reverberated, with others, on Capitol Hill on March 29 - and we'll have more on it.

  Meanwhile the US Federal Reserve Board, which bears more than a little responsibility for the global financial crash from 2008 due to inattention to predatory lending including on mergers, has now further reduced its scrutiny of bank mergers, with little notice to date. Now Fair Finance Watch and Inner City Press has timely challenged the Federal Reserve's stealth reduction of scrutiny, in a timely request for reconsideration filed with the Federal Reserve on the evening of March 27, below. FFW and others including NCRC protested, and Inner City Press has Freedom of Information Act requests pending regarding, the application by People's United to acquire Suffolk County National Bank.

May 29, 2017

After Fair Finance Watch Protested Synovus - Cabela, Federal Reserve Asks Synovus 7 Questions

By Matthew R. Lee

NEW YORK, May 22 –  The Federal Reserve has asked  Synovus more than a half dozen questions on May 22, on its (straw-man)  application to acquire Cabela's World's Foremost Bank, the questions annexed on May 22 here. Two months after Inner City Press reported  Capital One failing in its  proposal to acquire this   "World's Foremost Bank," a way  to try to avoid the regulators  and Capital One's Community  Reinvestment Act record  emerged. The scam involves Synovus buying the bank then passing one the credit card   receivables to Capital One, while keeping the deposits, so  Capital One wouldn't be  reviewed under CRA. The Fair Finance Watch has now opposed this, in a filing to the Federal Reserve. NCRC has commented as well. We'll have more on this.

May 22, 2017

Regulators Said Sterling's CRA Data Unreliable, Sterling Mis-Sends Response, Fed Expedites ICPs FOIA

By Matthew R. Lee, New Platform

NEW YORK, May 20 – Sterling Bank, which is applying for approvals to acquire Astoria Bank, is known by its regulators to have filed unreliable Community Reinvestment Act data from at least 2014 through 2016, a document obtained by Inner City Press shows. The story, and outrage, has been picked up by the American Banker newspaper here, by Paul Davis and Allison Prang, crediting Inner City Press - and Sterling Bank had no comment. Instead, Sterling's outside counsel Wachtel Lipton chose to snail-mail its response to the wrong address, and not e-mail it to Fair Finance Watch. Via here, with envelope re-submitted to Fed and OCC. This while the Federal Reserve has granted Inner City Press' request for expedited treatment of its FOIA request for all records, promising the responsive documents by June 1. Fed letter on Scribd, here.

Regulators Said Sterling's CRA Data Unreliable, Sterling Mis-Sends Response, Fed Expedites ICPs FOIA, Here by Matthew Russell Lee on Scribd

Fair Finance Watch has asked both the Fed and OCC to extend their comment periods past this date. Watch this site. Sterling has issued a press release ("covered" without any analysis by Reuters) that "the Federal Reserve inadvertently made public confidential supervisory information.. Because of the legal constraints relating to disclosure of confidential supervisory information, we are working closely with our regulators to craft a more detailed public response." Sterling is working WITH the regulators - the judges in this case - to spin its inaccurate data? After on its last acquisition, challenged by ICP, having to make a CRA compliance plan? Inner City Press has submitted Freedom of Information Act requests (a response here) and Fair Finance Watch has filed additional comments to the Federal Reserve and OCC, demanding public hearings into the unreliable data AND into how the regulators were dealing with (or covering up) the issue, in stealth. We'll have more on this: the US Federal Reserve denied Fair Finance Watch's request to extend the comment period on Sterling's application, in which even the Fed suspects there is incorrect CRA data.

On May 11, the Federal Reserve Bank of New York along with questions about about branch closures and a CRA plan required after Fair Finance Watch's previous challenge to Sterling asked: "In a letter dated December 23, 2016, from the OCC to Sterling Bank regarding the OCC's data integrity review, the OCC stated that Sterling Bank's 2014-2016 CRA data is not reliable and that Sterling Bank lacks an effective process for collecting, verifying and reporting such data. To the extent that any of the CRA data in the notice is incorrect, submit the corrected data. In addition, describe Sterling Bank's efforts to address its CRA data compliance management deficiencies."

So on April 26 in Sterling's analysts' call, did CEO Jack Kopnisky or Senior EVP Luis Massiani disclose the “unreliable” CRA data to, among others, Dave Bishop – FIG Partners, Casey Haire – Jefferies, Alex Twerdahl – Sandler O'Neill,, Collyn Gilbert – KBW, Matthew Breese – Piper Jaffray and Erik Zwick – Stephens Inc? Questions about this deal (here) and the Fed's commitment to public scrutiny are raised by its simultaneous denial of FFW's request for a hearing and to extend the comment period. There is no indication that the "corrected" CRA data would ever be made available to the public, or that this issue would not have been swept under the US bank regulators' carpet, like so many others. We'll have more on this. 

May 15, 2017

Regulators Said Sterling Bank's CRA Data Unreliable, ICP Exposed It, FFW Demands Hearing

By Matthew R. Lee, New Platform

NEW YORK, May 12 – Sterling Bank, which is applying for approvals to acquire Astoria Bank, is known by its regulators to have filed unreliable Community Reinvestment Act data from at least 2014 through 2016, a document obtained by Inner City Press shows. The story, and outrage, has been picked up by the American Banker newspaper here, by Paul Davis and Allison Prang, crediting Inner City Press - and Sterling Bank has "no comment." But Fair Finance Watch has filed additional comments to the Federal Reserve and OCC, demanding public hearings into the unreliable data AND into how the regulators were dealing with (or covering up) the issue, in stealth. We'll have more on this: the US Federal Reserve denied Fair Finance Watch's request to extend the comment period on Sterling's application, in which even the Fed suspects there is incorrect CRA data.

On May 11, the Federal Reserve Bank of New York along with questions about about branch closures and a CRA plan required after Fair Finance Watch's previous challenge to Sterling asked: "In a letter dated December 23, 2016, from the OCC to Sterling Bank regarding the OCC's data integrity review, the OCC stated that Sterling Bank's 2014-2016 CRA data is not reliable and that Sterling Bank lacks an effective process for collecting, verifying and reporting such data. To the extent that any of the CRA data in the notice is incorrect, submit the corrected data. In addition, describe Sterling Bank's efforts to address its CRA data compliance management deficiencies."

So on April 26 in Sterling's analysts' call, did CEO Jack Kopnisky or Senior EVP Luis Massiani disclose the “unreliable” CRA data to, among others, Dave Bishop – FIG Partners, Casey Haire – Jefferies, Alex Twerdahl – Sandler O'Neill,, Collyn Gilbert – KBW, Matthew Breese – Piper Jaffray and Erik Zwick – Stephens Inc? Questions about this deal (here) and the Fed's commitment to public scrutiny are raised by its simultaneous denial of FFW's request for a hearing and to extend the comment period. There is no indication that the "corrected" CRA data would ever be made available to the public, or that this issue would not have been swept under the US bank regulators' carpet, like so many others. We've submitted FOIA requests. We'll have more on this. 

May 8, 2017


After Capital One Failed on Cabela, Synovus Applies & FFW Protests to Federal Reserve, Here

By Matthew R. Lee

NEW YORK, May 6 – Two months after Inner City Press reported Capital One failing in its proposal to acquire Cabela's "World's Foremost Bank," a way to try to avoid the regulators and Capital One's Community Reinvestment Act record emerged. The scam involves Synovus buying the bank then passing one the credit card receivables to Capital One, while keeping the deposits, so Capital One wouldn't be reviewed under CRA. The Fair Finance Watch has now opposed this, in a filing to the Federal Reserve: "On behalf of Inner City Press / Fair Finance Watch (FFW), this is a timely first comment opposing and requesting an extension of the FRS' public comment period on the Application by Synovus - and, we contend, CAPITAL ONE NA, to acquire the “WORLD'S FOREMOST BANK.”This comment is timely. For the record, there was initially filed with the OCC an application by Capital One to buy this “Foremost Bank.” When the compliance problems of that proposal became clear, this sham transaction was devised: for Synovus (also dubious) to make the initial acquistion, and then pass much of it on to Capital One, thereby evading review of Capital One, including but not limited to CRA review. This should not be countenanced. This applications is not even listed in the FRB's H2A, but only the H2, thusly: “* 18C Not applicable Synovus Bank, Columbus, Georgia, to acquire 05/19/2017 certain assets and to assume the deposits of World's Foremost Bank Sidney, Nebraska” It does not mention the role of Capital One. In the New York City MSA in 2015, the most recent year for which HMDA data is available, for conventional home purchase loans Capital One denied the applications of whites 23% of the time, while denying African Africans fully 45% of the time, and Latinos even more, 46% of the time. This is unacceptable.
Meanwhile, Capital One is “closing branches in Laurel, Gaithersburg, Frederick and Merrifield.”
As to Synovus' Bank, in 2015 in the Atlanta GA MSA it made 53 home purchase loans to whites and only seven to African Americans, NONE to Latinos. In the Birmingham Alabama MSA it made 45 home purchase loans to whites and only three to African Americans. If the bank cites Synovus Mortgage, note that in the Charlotte NC MSA in 2015 for home purchase loans, it lend to whites but not African Americans much less Latinos. Fair Finance Watch will submit further comments in the extended comment period. On the current record, the application(s) should be denied."

May 1, 2017

After FFW Protests Sterling's Application To Buy Damaged Astoria, Fed Confirms Receipt

By Matthew R. Lee, New Platform

NEW YORK, April 28 – After Astoria Bank's protested proposal to be acquired by New York Community Bank fell apart in late 2016, it found a new, equally controversial suitor: Sterling Bancorp. Now Fair Finance Watch has submitted a first Community Reinvestment Act challenge to the proposed merger, receipt of which the Federal Reserve has now confirmed, here. Inner City Press' summary of FFW's filing: "Dear Chair Yellen, Secretary Misback and others in the FRS: This is a timely first comment opposing and requesting an extension of the FRB's public comment period on the Application by Sterling Bancorp, Montebello, New York (“Sterling”) to merge with Astoria Financial Corporation, Lake Success, New York, and indirectly acquire Astoria Bank (“Astoria”).
This would be a combination of banks with disparate and in places highly irregular Home Mortgage Disclosure Act (“HMDA”) data. The proposal is the desperate result of the failure of Astoria's attempted merger with NYCB. That is no reason to approve this mis-conceived combination. The applicant's Sterling National Bank (“Sterling”) in the New York City MSA in 2015 for African Americans for home purchase loans denied the applications of African Americans 3.58 times more frequently than those of whites - much worse than other lenders. Sterling made only 22 such home purchase loans to African Americans, versus 495 to whites (and only 37 to Latinos) - again, much more disparate than other lenders. This bank should not buy Astoria. Remember: in the Nassau Suffolk MSA in 2013, Sterling made 149 home purchase loans to whites – and only one to an African American. For home improvement loans, Sterling made 30 to whites, none to African Americans. Taken together, this is unacceptable. The comment period should be extended to clarify – or refile – the HMDA data; evidentiary hearings should be held; and on the current record, the application should not be approved.
For the record, the CRA plan required after Fair Finance Watch's previous protest, we contend has not been complied with, and request evidentiary and public hearings on that basis.
Also for the record:  'The NYCB-Astoria Financial Merger is Kaput: Consumer advocates were among the groups that opposed NYCB’s acquisition of Astoria…'"

   In January, disparate lender Investor Bancorp, on which Fair Finance Watch previously got a condition imposed saw its proposal with Bank of Princeton fall apart.

April 24, 2017

  The beginning of something? "The Federal Reserve on Thursday announced two enforcement actions against Deutsche Bank AG that will require the bank to pay a combined $156.6 million in civil money penalties."

April 17, 2017

  Following the protest by Fair Finance Watch, the Federal Reserve has asked TIAA-CREF a fifth round of questions: "Provide an update on EverBank’s CRA activities since its last publicly available CRA Performance Evaluation. Your response should include any significant CRA initiatives undertaken, particularly with respect to credit and deposit products and retail banking services targeted toward low-to-moderate income geographies and individuals. In addition, provide information regarding community development lending, investments, and services in EverBank’s CRA assessment area since the last evaluation period, including the total number and dollar amount (except for community development services) and a brief description of the most significant community development loans, investments, and services." We'll have more on this.
April 10, 2017

We devote this week's Community Reinvestment Reporter to Jeff Williams, valiant CRA activist and public interest lawyer in Kansas City who has died of an apparent heart attack. Inner City Press and Fair Finance Watch worked with him on many campaigns and learned a lot. Here's from a recent filing: "I represent the Concerned Clergy Coalition, (“CCC”), a ministerial alliance of several dozen inner city churches in Kansas City, Missouri and the Historic East Neighborhood Coalition, (“HENC”), a group of thirteen inner urban core neighborhood associations in the area roughly bounded by Truman Road on the North, Brush Creek Boulevard on the South, Troost Avenue on the West, and Interstate 435 on the East in Kansas City, Missouri. For a number of years CCC has worked on issues concerning community reinvestment as part of its efforts to improve the economic condition of the community it serves. This has included periodically commenting on applications by banks to regulatory agencies for permission to consummate changes in their organizations. It has also included having an ongoing dialogue with local banks and regulators on community reinvestment needs and programming in what is commonly known as Kansas City, Missouri’s Eastside. HENC has for the past several years worked with various agencies to improve housing, public safety, health, and economic conditions in the various neighborhoods it serves. Its activities have recently included working on community reinvestment issues in their member neighborhoods... In the course of reviewing the CRA activities of local banks our clients were surprised to find that UMB Bank has not had a CRA Public Evaluation release since..." To be carried on. RIP.

April 3, 2017

Wells Fargo Paying $110 Million For Fake Accounts, 400 Branch Closures Still On?

By Matthew R. Lee

WASHINGTON, March 29 – The day after Wells Fargo Bank's Community Reinvestment Act rate was dropped to "Needs to Improve," barring it from acquisitions, the bank settled for $110 million a class action lawsuit for having opened fake accounts without customers' knowledge or approval. But will Wells Fargo, which Inner City Press has covered through its acquisition of First Union and even before, from Washington to Alaska, still be allowed to go forward with its reported plan to close 400 bank branches, including in low and moderate income areas? The question reverberated, with others, on Capitol Hill on March 29 - and we'll have more on it.

  Meanwhile the US Federal Reserve Board, which bears more than a little responsibility for the global financial crash from 2008 due to inattention to predatory lending including on mergers, has now further reduced its scrutiny of bank mergers, with little notice to date. Now Fair Finance Watch and Inner City Press has timely challenged the Federal Reserve's stealth reduction of scrutiny, in a timely request for reconsideration filed with the Federal Reserve on the evening of March 27...

March 27, 2017

  So the CFPB finally fined Nationstar Mortgage LLC $1.75 million for violating the Home Mortgage Disclosure Act (HMDA). And the other lenders violating HMDA?

March 20, 2017

Amid DC Ideas of Glass-Steagall, Acquisitive Simmons Is Asked by Fed of FFW's CRA Protest

By Matthew R. Lee

NEW YORK, March 14 – Amid proposals in Washington even for a re-instituted modified Glass Steagall Act (Inner City Press is following the proposals of Tom Hoenig, even reported overseas), acquisitive bankers and their hangers-on around the United States are getting sassy.

  As an example of acquisitive sass, Arkansas-based Simmons National's CEO George Makris in a January conference call was dismissive of the abuses raised by Fair Finance Watch to the Federal Reserve in opposition to his bank's application to acquire Hardeman Investments. Simmons has announced yet another proposed acquisition, of Southwest Bancorp in Texas.

  Well, now the Federal Reserve has asked Makris' Simmons questions including this on the Community Reinvestment Act issues Fair Finance Watch has raised: "“This letter concerns the application dated November 23, 2016, by Simmons First National Corporation, Pine Bluff, Arkansas, to merge with Hardeman County Investment Company, Inc., and thereby indirectly acquire its subsidiary, First South Bank, both of Jackson, Tennessee, pursuant to section 3 of the Bank Holding Company Act of 1956, as amended. Upon review of the information in the record, staff of the Board of Governors of the Federal Reserve System (“Board”) requests the following additional information. Supporting documentation should be provided as appropriate.
1. Describe in depth the Community Reinvestment Act (“CRA”) related initiatives of Simmons Bank, Pine Bluff, Arkansas, in both the Little Rock, Arkansas, metropolitan statistical area (“MSA”), and the Memphis, Tennessee-Mississippi-Arkansas, MSA, since the bank’s 2013 CRA performance evaluation, performed by the Office of the Comptroller of the Currency. Your response should describe the specific CRA-related initiatives that Simmons Bank has undertook in these MSAs since its 2013 evaluation, as well as its CRA-related plans in both MSAs after consummation of the proposal. Please address your responses within eight business days...”

 This follows a February letter, here, from the Federal Reserve to Simmons, posing questions about the issues FFW has raised, such as these:

"This is a timely first comment by Fair Finance Watch opposing the Application by Simmons First National Corporation to acquire Hardeman County Investment Company Inc., and thereby indirectly acquire First South Bank.

    Simmons First has a presumptive not-credible Home Mortgage Disclosure Act reporting record, which may in turn violate Equal Credit Opportunity Act rights. Now that it reports some denials, they are disparate.

   In essence, the HMDA data still reflect that Simmons First “cooks the books” to not issue or acknowledge denials. For conventional home purchase loans in the Little Rock MSA in 2015, Simmons First reported 394 applications from whites, with fully 329 originations and 12 denials, a 3% denial rate. For African Americans, Simmons First's denial rate was 19% -- more than six times higher than for whites.

 In the Memphis MSA for conventional home purchase loans in 2015, Simmons First's denial rate for African Americans was 100%, while it was only 4% for whites - an incalculable disparity.

Simmons First “plans to reduce Hardeman's annual noninterest expenses by $5.3 million.” How?

  This acquisition application should be denied."

March 13, 2017

After FFW Protest Stopped NYCB Bid, Astoria Wants To Be Bought By Disparate Sterling

By Matthew R. Lee

NEW YORK, March 7 – After Astoria Bank's protested proposal to be acquired by New York Community Bank fell apart in late 2016, now it has found a new, equally controversial suitor: Sterling Bancorp. Fair Finance Watch showed in 2015 that Sterling's lending record was so disparate that the Office of the Comptroller of the Currency imposed a Community Reinvestment Act condition on Sterling. Now Inner City Press' review of the most recent Home Mortgage Disclosure Act data from that in the New York City Metropolitan Statistical Area Sterling denied the home purchase loan applications of African Americans more than 3.5 times more frequently that those of whites, worse that the rest of the industry. It denied Latinos 2.15 times more frequently than whites, also worse than other lenders. We'll have more on this.

   In January, disparate lender Investor Bancorp, on which Fair Finance Watch previously got a condition imposed saw its proposal with Bank of Princeton fall apart.

  There's also Capital One - Cabela, on which Inner City Press commented: "In the New York City MSA in 2015, the most recent year for which HMDA data is available, for conventional home purchase loans Capital One denied the applications of whites 23% of the time, while denying African Africans fully 45% of the time, and Latinos even more, 46% of the time. This is unacceptable.

  Meanwhile, Capital One is “closing branches in Laurel, Gaithersburg, Frederick and Merrifield.”

   Capital One came back with snark, as has Simmons National -- but then announced including to NCRC that  it will withdrawn its application. Onward.

March 6, 2017

After FFW Protest, Fed Sends Community Bank System 9 Questions, CEO Tryniski Trashes CRA

By Matthew R. Lee

NEW YORK, March 2 – At what point does bank executives' spin to investors and the media become more than misleading? Take Community Bank System (NYSE: CBU), which has now received nine additional questions from the Federal Reserve on its proposal to acquire Merchants, after its CEO derided issues Fair Finance Watch raised about the proposal.

  On its last proposal, CBSI bad-mouthed a Community Reinvestment Act protest even as it had to delay its Oneida deal. First, CBSI's "Hal Wentworth said that Inner City Press is not a local group and pointed out that letter was the only one filed on the Oneida deal. 'This activist does not do business with either Oneida or Community Bank, but nonetheless made vague allegations regarding Community,' Wentworth said. 'These allegations were entirely without merit and will be fully addressed by Community Bank and Oneida Savings in the application process.'" Then the deal was significantly delayed, with CBSI pushing the date back.

  More spin:  CFO Scott Kingsley told the media that FFW's protest "is not the sole reason. We have other things that have to sequentially happen to get to the technological conversion in July. When we did not have a definitive answer from the Fed or other parties last week, that put the technological conversion at risk, so we opted not to go ahead.”

  This time, it went to the CEO Mark Tryniski, who in January 2017 told stock analysts that "despite the baseless protest filed with the Fed Reserve by a serial activist, we expect to close in the second" question. We'll see. Among the nine questions: "Community Bank states that, to the extent it does not intend to continue to offer certain loan products and services offered by Merchants Bank post-merger, it does not believe that not offering such products and services would have a significant impact on the target bank's communities. As an example, Community Bank cites the fact that Merchants Bank would no longer accept applications for FHA/VA loans (on behalf of a mortgage company), but that Community Bank would offer loan products and programs which are not currently offered by Merchants Bank that Community Bank believes are comparable and 'equally valuable' to its communities, such as FNMA's Home Ready Program, Community Bank's Affordable Housing Program, and the USDA loan program. Compare the features of FHA and VA loans for which applications are presently taken by Merchants Bank with the features of the products and programs that Community Bank asserts are comparable, including any features of FHA and VA loans that are not covered by Community Bank's offerings."  Watch this site.

February 27, 2017

   The Federal Reserve, confronted even with court settlements by banks, says it was without admission of guilt. From February 24: "FNB’s overdraft practices were found to be unfair trade practices resulting in unjust enrichment as part of a class-action litigation, Ord v. First National Bank of Pennsylvania, No. 2:12-cv-00766-AJS (W.D. Pa. dismissed June 21,
2013). The case was settled without any admission of wrongdoing by the parties. Final Judgment & Order of Dismissal with Prejudice at 4–5, Ord (No. 2:12-cv-00766-AJS). " We'll have more on this.

February 20, 2017

While stock arbitrageurs continue to ask Fair Finance Watch and Inner City Press to confirm, this: "Capital One withdrew its application to acquire the card business late last month, according to the U.S. Office of the Comptroller of the Currency, a government bank regulator that also is in charge of approving such an acquisition as the Capital One-Cabela’s tie-up."

February 13, 2017

Amid DC Moves On CFPB, Acquisitive Simmons Is Asked by Fed of FFW's Protest

By Matthew R. Lee

NEW YORK, February 9 – Amid de-regulatory moves in Washington, acquisitive bankers and their hangers-on around the United States are getting sassy.

  From Washington -- K Street to be exact -- comes this memo, which Fair Finance Watch is putting online here. And as an example of acquisitive sass, Arkansas-based Simmons National's CEO George Makris in a January conference call was dismissive of the abuses raised by Fair Finance Watch to the Federal Reserve in opposition to his bank's application to acquire Hardeman Investments. Simmons has announced yet another proposed acquisition, of Southwest Bancorp in Texas.

  Well, here now is a question-letter from the Federal Reserve to Simmons, posing questions about the issues FFW has raised, such as these:

"This is a timely first comment by Fair Finance Watch opposing the Application by Simmons First National Corporation to acquire Hardeman County Investment Company Inc., and thereby indirectly acquire First South Bank.

    Simmons First has a presumptive not-credible Home Mortgage Disclosure Act reporting record, which may in turn violate Equal Credit Opportunity Act rights. Now that it reports some denials, they are disparate.

   In essence, the HMDA data still reflect that Simmons First “cooks the books” to not issue or acknowledge denials. For conventional home purchase loans in the Little Rock MSA in 2015, Simmons First reported 394 applications from whites, with fully 329 originations and 12 denials, a 3% denial rate. For African Americans, Simmons First's denial rate was 19% -- more than six times higher than for whites.

 In the Memphis MSA for conventional home purchase loans in 2015, Simmons First's denial rate for African Americans was 100%, while it was only 4% for whites - an incalculable disparity.

Simmons First “plans to reduce Hardeman's annual noninterest expenses by $5.3 million.” How?

  This acquisition application should be denied."

February 6, 2017

  The branch closing are coming fast and furious. Scandal plagued Wells Fargo is set to close 400 by 2018; the Huntington closures are looming, starting with 39. FFW protested the latter and will the former - watch this site.

January 30, 2017

  After saying his bank's proposed merger will be delayed, Community Bank System President and CEO Mark Tryniski said Fair Finance Watch's is a "baseless protest." No, it's that the bank's record is still terrible - as it was when Fair Finace Watch got a condition imposed on it in connection with Oneida. Will this one go the way of Investors - Bank of Princeton?

January 23, 2017

  Among other comments, Fair Finance Watch has filed this:

On behalf of Inner City Press/Fair Finance Watch (ICP), this is a timely first comment opposing and requesting an extension of the FRB's public comment period on the Application of Community Bank System to acquire Merchants Bancshares, Inc. and Merchants Bank. This first comment is timely:

Community Bank System proposes to acquire Merchants. But in the the Buffalo and Syracuse MSAs in 2015, the most recent year for which Home Mortgage Disclosure Act data is publicly available, Community Bank NA dramatically excluded people of color.

For conventional home purchase loans in the Buffalo MSA in 2015, Community Bank NA made 58 such loans to whites and NONE to African Americans. It denied the only application it received from an African American.

For refinance home purchase loans in the Buffalo MSA in 2015, Community Bank NA made 19 such loans to whites and NONE to African Americans or Latinos.

For home improvement loans in the Buffalo MSA in 2015, Community Bank NA made 100 such loans to whites and NONE to African Americans or Latinos.

This is outrageous.

In the Syracuse MSA in 2015, Community Bank NA made 155 conventional home purchase loans to whites and NONE to African Americans.

For refinance loans in the Syracuse MSA in 2015, Community Bank NA made 121 such loans to whites and NONE to African Americans. It denied the only application it received from an African American.

This is outrageous.

Also, “Vermont still has 6 other state-chartered banks, but they all serve small regions of the state.... The last state-chartered bank to merge with a federally-chartered bank was Chittenden Bank, which became part of the Connecticut-based People’s United Bank on Jan. 1, 2008.”

In this context, the comment period should be extended so that public evidentiary hearings can be held, and the application should be denied.

Nor should Community Bank Systems be permitted to acquire Northeast Retirement Services...

January 16, 2017

Fair Finance Watch has timely raised issues on TD - Scottrade. Some of them:

"On behalf of Inner City Press/Fair Finance Watch (ICP), this is a timely first comment opposing and requesting an extension of the OCC's public comment period on the Application by TD BANK, NA To Acquire SCOTTRADE BANK. This comment is timely.

As you should know, the overall deal faces challenges. See, e.g, “TD Ameritrade faces scrutiny over Scottrade purchase,” http://finance.yahoo.com/news/td-ameritrade-buy-scottrade-two-110347591.html, including that

“As part of those plans, Hockey said around 25 percent of the combined business's 600 branches will be closed. TD Ameritrade currently has 100 branches while Scottrade has 500. Hockey said in the interview the combined workforce of 10,000 will be reduced by about 20 percent.”

For purposes of this initial comment -- the link to the application in the OCC's FOIA Reading Room has not been working, and the comment period should be extended on that ground as well - we focused on Scottrade Bank's HMDA reporting, of purchased loads in Alabama, Arizona - and that's just in the A's.

Because the loans are purchased and sold, they do not contain the identifying information we are requesting. But how this nationwide purchase of mortgages, presumably from brokerage clients, complies with the Community Reinvestment Act is one of the issues we intend to address at the request hearing(s).

See, e.g., from Scottrade bank's Disclosure Supplemental Table 2 for 2015, in NYS:
NY/BRONX COUNTY/0293.02 1 687"
etc

January 9, 2017

The Federal Reserve has asked, after comments, about branches closings and consolidations:

"In response to Question 10 of the Bank Merger Act application, United indicates that it anticipates consolidating six UBVA branches into six Cardinal Bank branches and six Cardinal Bank branches into six UBVA branches, and is considering consolidating two additional branches. Exhibit L to Form 2070 indicates that United plans to consolidate six UBVA branches into six Cardinal Bank branches and seven Cardinal Bank branches into seven UBVA branches, and is considering consolidating two additional branches. Please provide clarification as to the number and location of branches to be consolidated or closed following the merger."
 
  We'll have more on this.

January 2, 2017

After Inner City Press / Fair Finance Watch requested TIAA's withheld fair lending exhibits under FOIA, the Fed between Christmas and New Years emailed a document - with the entire fair plan redacted...

December 26, 2016

Bank Merger Called Off After ICP Protested  NYCB - Astoria on Disparities

By Matthew R. Lee

NEW YORK, December 20 -- In January of this year, Inner City Press / Fair Finance Watch submitted a protest to the Federal Reserve to New York Community Bank's application to acquire Astoria.

 And now on December 20 the companies have called off the merger, after being told they would not get any approval before the end of the year. Inside Mortgage Finance, for example, cites Inner City Press / Fair Finance Watch as the slayer of the deal. It's about time.

 On July 20, the Fed asked NYCB this:

"Based on staff’s review of the current record, the following additional information is requested. Supporting documentation, as appropriate, should be provided.

"In its February 13, 2016, comment on the proposal, Inner City Press/Fair Finance Watch (“ICP”) alleges that New York Community Bank’s and Astoria’s branch patterns disproportionately exclude Upper Manhattan and particularly the Bronx, which ICP states is the most predominately minority and low-income community in the state of New York. Please respond to these allegations. Please provide a copy of the public portion of your response directly to Matthew Lee of ICP. Any information for which you desire confidential treatment should be so labeled and separately bound in accordance with section 261.15 of the Board’s Rules Regarding Availability of Information"

 We'll see. Inner City Press' protest set forth that  NYCB in the New York City MSA in 2014 made 109 home purchase loans to whites -- and only THREE to African Americans. For refinance loans, NYBC in the the NYC MSA in 2014 made 27 loans to whites and only ONE to an African American.
 
  In the Cleveland, Ohio MSA (where NYCB bought Ohio Savings - and in the new this week), NYCB in 2014 made 17 refinance loans to whites in 2014 and only one to an African American, while denying African Americans, while denying African Americans three times more frequently than whites.

 " In the Nassau Suffolk (Long Island) MSA in 2014 NYCB made 107 home purchase loans to whites -- and only ONE to an African American, while denying African Americans 4.7 times more frequently than whites.

Aggregate / all lenders on Long Island 2014, conventional home purchase loans:

Unlike NYCB's 4.7 denial rate disparity between African Americans and whites, for all lenders it is (substantially) below 2 to 1: by all lenders on Long Island in 2014 for conventional home purchase loans, African Americans were denied 1.62 times more frequently then whites.

  Unlike NYCB's 107 loans to whites for each (1) loan(s) to African Americans, for the aggregate there are 23 loans to whites for each loan to African Americans.

" For refinance loans, NYCB in the the Long Island MSA in 2014 made 52 loans to whites and only three to African Americans and only TWO to Latinos, while denying Latinos 2.32 times more frequently than whites."

December 19, 2016

These are ones to watch:

Federal Reserve:

Chair: Janet L. Yellen, Term Expires February 3, 2018 (as Chair), January 31, 2024 (as Gov.)
Vice Chair: Stanley Fischer, Term Expires June 12, 2018 (as Vice Chair), January 31, 2020 (as Gov.)
Governor: Daniel K. Tarullo, Term Expires January 31, 2022
Governor: Jerome H. Powell, Term Expires January 31, 2028
Governor: Lael Brainard, Term Expires January 31, 2026
2 Governor Seats Currently Vacant

OCC
Comptroller: Thomas Curry, Term Expires April 2017

FDIC
Chairman: Martin J. Gruenberg, Term (as Chair) Expires November 2017
Vice Chairman: Thomas M. Hoenig, Term (as Commissioner) Expires April 2018
Director: Seat Currently Vacant
Outside Directors: Comptroller of the Currency

December 12, 2016

  The TIAA fight goes on - now they are trying to withhold fair lending information, which on December 10 we challeged:

or the entirety of the December 9, 2016 submission in connection with the Application by TIAA et al to acquire EverBank. As provided under the FRB's ex parte rules, the submission refers to “confidential” portions the withholding of which we are challenging with this FOIA request on, for example, “consumer compliance and fair lending compliance, as well as the Resultant Institution’s Fair and Responsible Practices Program.”

December 5, 2016

After ICP Challenges TIAA-Everbank, Fed's 3d Round of Qs, CRA Included

By Matthew R. Lee

NEW YORK, November 29 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to People's United Bank now trying to buy Suffolk County National Bank while barely lending to people of color in New York. 

  Then there are cross-industry proposals like TIAA's attempt to acquire Everbank of Florida, which Inner City Press / Fair Finance Watch on October 29 challenged, and attempts from overseas to buy Genworth.

The Federal Reserve has asked a third round of questions of TIAA, which we publish here in full, including one on CRA:

"In connection with the request for the Board’s prior approval pursuant to section 10(e)(1)(A)(iii) of the Home Owners’ Loan Act, as amended, 12 U.S.C. 1467a(e)(1)(A)(iii), and 12 CFR 238.11(e) by TIAA Board of Overseers, Teachers Insurance and Annuity Association of America (“TIAA”), and TCT Holdings, Inc., each of New York, New York, to acquire control of EverBank Financial Corp., a savings and loan holding company, and EverBank, a federal stock savings association, both of Jacksonville, Florida, the following information is requested. Supporting documentation should be provided as appropriate.

1. If the transaction is consummated as proposed, describe in detail any authority that the New York Department of Financial Services (“DFS”) or any other regulatory entity (apart from the Federal Reserve Board) may have to:

a. Prevent TIAA from down streaming funds or otherwise acting as a source of financial strength to a subsidiary, including a subsidiary depository institution;

b. Directly or indirectly prevent the Surviving Intermediate HoldCo (as that term is defined and used in the application) from down streaming funds or otherwise serving as a source of financial strength to the resultant subsidiary depository institution;

c. Directly or indirectly require Surviving Intermediate HoldCo to dividend or otherwise distribute funds to TIAA; or

d. Directly or indirectly require a subsidiary depository institution to dividend or otherwise distribute funds to TIAA. For each of the scenarios described above, include a detailed discussion of the circumstances in which the regulator could exercise such authority, and include citations as appropriate.

2. Indicate any dollar amount or percentage thresholds or limitations on transactions that TIAA may conduct with a subsidiary or affiliate, including with the Surviving Intermediate HoldCo, without prior approval of DFS, and provide any statutory or regulatory authority that addresses this limitation.

3. To the extent not previously disclosed in the application, and to the extent known with respect to EverBank, discuss any pending or recently resolved litigation with or investigations by regulators, including, but not limited to, those pertaining to consumer protection laws and regulations, against TIAA-CREF Trust Company, FSB (“TIAA FSB”) or EverBank.

4. Clarify the extent to which the consumer compliance, fair lending compliance, and Community Reinvestment Act programs of the resultant depository institution will consist of the current programs of TIAA FSB or EverBank. Discuss any aspects of these programs that differ from those currently in place at TIAA FSB or EverBank."

Earlier, some of TIAA's answers were provided to Inner City Press on November 10 and are published here (here and embedded below in full)

"We are grateful for this opportunity to respond to the comment letter filed by Inner City Press  /Fair Finance Watch on 29 October 2016 (the “Comment Letter”), regarding the application submitted by TCT Holdings, Inc., Teachers Insurance and Annuity Association of America (“TIAA”)... The Comment Letter makes a series of assertions regarding the lending practices of TIAA-CREF Trust Company, FSB (“TIAA FSB”) and EverBank by referencing certain Home Mortgage Disclosure Act (“HMDA”) data for 2015. It also suggests that TIAA does not satisfy the requisite managerial standards consistent with approval. Finally, the Comment Letter requests an extension of the public comment period and a public hearing on the Application...

EverBank has advised the Applicants that it has carefully evaluated and investigated the allegations and it has provided the Applicants with information following its manual review of each of the eight declined applications underlying the data cited in the Comment Letter...

The commenter also suggests that allegations in a dated news article that TIAA has engaged in improper business practices in Brazil should be considered by the Federal Reserve Board as a factor when considering the managerial resources of the Applicants. The news article cited in the Comment Letter does not provide a complete or accurate portrayal of how TIAA conducts business in Brazil and other markets... TIAA is a signatory to the U.N. Principles for Responsible Investment."

  Ah, the United Nations... We'll have more on this.

November 28, 2016

Inner City Press has just filed: "This is a FOIA request for the entirety of the November 22, 2016 submission in connection with the Application by TIAA et al to acquire EverBank. As provided under the FRB's ex parte rules, the submission refers to “confidential” exhibits the withholding of which we are challenging with this FOIA request for, for example, “Please see Confidential Exhibit 7 for an explanation of the uncommitted $300 million credit line;” “the Resultant Institution will continue to satisfy the QTL test under prong (iv), as demonstrated in Confidential Exhibit 2;”" etc...

And this:

This is a timely first comment opposing and requesting an extension of the FRS's public comment period on the Application by United Bankshares and UBV Holding Company to acquire 100 percent of the voting shares of Cardinal Financial Corporation and Cardinal Bank

These transaction raises troubling Community Reinvestment Act issues. United Bank has a disparate lending record and is growing worse, as does Cardinal's George Mason Mortgage.

And, significantly, the specifics of which branches would be closed have not been publicized.

In the Washington DC MSA in 2015 for home purchase loans, United Bank (Virginia) made 96 such loans to whites and only five to African American applicants, and only seven to Latinos.

In the Silver Spring - Rockville MSA in 2015, for home purchase loans High Point made 14 loans to whites and NONE to African Americans or Latinos.

Consider also the record of Cardinal's George Mason Morgage, which United wants to buy.
In the Washington DC MSA in 2015 for conventional home purchase loans, George Mason denied the applications of African Americans 3.17 times more frequently than whites, and those of Lationos 2.17 times more frequently than whites.

See also, http://www.wvgazettemail.com/news-business/20160827/united-bankshares-buys-cardinal-now-largest-company-headquartered-in-wv#sthash.8FhbkxWN.dpuf:

“Cardinal is based in Tysons Corner, Virginia, with 30 branches of its subsidiary Cardinal Bank in the Washington, D.C., metro area.... As with most mergers, there’s potential for overlap whether it’s in branch-based or corporate positions, but Adams said it’s too soon to tell how many positions will overlap... Adams said United has also seen the effect of this trend. 'In all of our locations, five states and the nation’s capital, there is a trend toward customers not using the branches as much as they used to, and I think that trend will continue.'”

On the current record, hearings should be held and the application(s) should not be approved. The comment period must be extended.

November 21, 2016

Of BOK, the Fed said last week of ICP's comment, " a commenter objected to the proposal on the basis of alleged disparities in the number of residential real estate loans made to minority borrowers, as compared to white borrowers, by BOK Bank in the Kansas City, Missouri-Kansas, Metropolitan Statistical Area (“Kansas City MSA”); the Houston, Texas, MSA (“Houston MSA”); and the Phoenix, Arizona, MSA (“Phoenix MSA”), as reflected in data reported under the Home Mortgage Disclosure Act (“HMDA”) for 2014.25 The
commenter further alleged that BOK Bank confined African American and Hispanic borrowers to government loan programs instead of conventional loan products in the
Kansas City MSA. Also, the commenter criticized the rate at which BOK Bank denied applications by African Americans and/or Hispanics, compared to the rate of denials for
whites, for home refinance loans in the Houston and Phoenix MSAs, as reported under HMDA for 2014. In addition, the commenter generally alleged that BOK Bank has a
weak record of lending to people of color and low-income individuals and a weak record of consumer compliance."

And we maintain that - and note the Fed accepting that "On September 9, 2016, the Securities and Exchange Commission (“SEC”) announced that it had settled charges against BOK regarding allegations that BOK Bank’s Corporate Trust Department, primarily through a senior executive, concealed problems and red flags from investors in certain bond offerings for which BOK Bank served as indenture trustee and dissemination agent between 2007 and 2015. See BOK Bank, SEC Order Instituting Cease-and-Desist Proceedings, File No. 3-17533 (September 9, 2016)"

November 14, 2016

After ICP Challenges TIAA-Everbank, Defense of Lending, Land Grabs

By Matthew R. Lee

NEW YORK, November 10 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to People's United Bank now trying to buy Suffolk County National Bank while barely lending to people of color in New York. 

  Then there are cross-industry proposals like TIAA's attempt to acquire Everbank of Florida, which Inner City Press / Fair Finance Watch on October 29 challenged, and attempts from overseas to buy Genworth.

The Federal Reserve has asked questions of TIAA, some of whose answers were provided to Inner City Press on November 10 and are published here (here and embedded below in full)

"We are grateful for this opportunity to respond to the comment letter filed by Inner City Press  /Fair Finance Watch on 29 October 2016 (the “Comment Letter”), regarding the application submitted by TCT Holdings, Inc., Teachers Insurance and Annuity Association of America (“TIAA”)... The Comment Letter makes a series of assertions regarding the lending practices of TIAA-CREF Trust Company, FSB (“TIAA FSB”) and EverBank by referencing certain Home Mortgage Disclosure Act (“HMDA”) data for 2015. It also suggests that TIAA does not satisfy the requisite managerial standards consistent with approval. Finally, the Comment Letter requests an extension of the public comment period and a public hearing on the Application...

EverBank has advised the Applicants that it has carefully evaluated and investigated the allegations and it has provided the Applicants with information following its manual review of each of the eight declined applications underlying the data cited in the Comment Letter...

The commenter also suggests that allegations in a dated news article that TIAA has engaged in improper business practices in Brazil should be considered by the Federal Reserve Board as a factor when considering the managerial resources of the Applicants. The news article cited in the Comment Letter does not provide a complete or accurate portrayal of how TIAA conducts business in Brazil and other markets... TIAA is a signatory to the U.N. Principles for Responsible Investment."

  Ah, the United Nations... We'll have more on this.

After ICP Challenges TIAA-Everbank, Here's TIAA's Defense to Federal Reserve of Lending Disparities, Land G... by Matthew Russell Lee on Scribd

November 7, 2016

After ICP Challenges People's United Bank's Suffolk Bid, Fed Asks 13 More Questions

By Matthew R. Lee

NEW YORK, October 31 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to People's United Bank now trying to buy Suffolk County National Bank while barely lending to people of color in New York.  Inner City Press / Fair Finance Watch on August 13 challenged this application and People's United, as it did Bancorp South in 2014, which led to redlining charges by the Department of Justice and Consumer Financial Protection Bureau.

Now the Federal Reserve, as released to Inner City Press on October 31, has asked People's United a series of questions, including for Community Reinvestment Act information from 2013, 2014, 2015 and 2016 year to date, it's (lack of) lending to African Americans and small businesses, its claims about  RBS Citizens Bank branches and restrictions imposed in connection with the still only proposed - and opposed - merger. We'll have more on this.

And on this: People's United Bank, if allowed to acquire Suffolk National Bank, would layoff at least 76 workers, according to a Worker Adjustment and Retraining Notification under the WARN Act, to the NYS Dep't of Labor....

October 31, 2016

Challenge to TIAA's Attempt To Buy Everbank, Citing Landgrab in Brazil

By Matthew R. Lee

NEW YORK, October 29 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to People's United Bank now trying to buy Suffolk County National Bank while barely lending to people of color in New York. 

  Then there are cross-industry proposals like TIAA's attempt to acquire Everbank of Florida, which Inner City Press / Fair Finance Watch on October 29 has challenged. Inner City Press / Fair Finance Watch has written to the Federal Reserve:

On behalf of Inner City Press/Fair Finance Watch (ICP), this is a timely first comment opposing and requesting public hearings and an extension of the FRB's public comment period on the Applications of TCT Holdings Inc., Teachers Insurance and Annuity Association of America and TIAA Board of Overseers, all of New York, New York; to acquire EverBank Financial Corp and thereby indirectly acquire EverBank. This first comment is timely.

This is in essence a proposal for a major cross-industry acquisition, in which TIAA (accused among other things of land grabs in Brazil, see below), which has limited experience in banking and a limited and highly disparate record in mortgage lending, seeks to acquire the largest Florida-based bank, with its own issues. Public hearings are needed.

In the St. Louis MSA, TIAA-CREF Trust in 2015, the most recent year for which Home Mortgage Disclosure Act data is available, reported data but lent only to whites.

Meanwhile Everbank, in the Miami MSA in 2015 for home mortgage loans in HMDA Table 4-1 had a 77% denial rate for African Americans, versus a 36% denial rate for whites. In Tampa for Table 4-1 it had a 100% denial rate for African Americans. Public hearings are required.

For the record, under the Managerial Resources and integrity factors, consider this:

TIAA-CREF, U.S. Investment Giant, Accused of Land Grabs in Brazil NOV. 16, 2015

SÃO PAULO, Brazil — As an American investment giant that manages the retirement savings of millions of university administrators, public school teachers and others, TIAA-CREF prides itself on upholding socially responsible values, even celebrating its role in drafting United Nations principles for buying farmland that promote transparency, environmental sustainability and respect for land rights.

But documents show that TIAA-CREF’s forays into the Brazilian agricultural frontier may have gone in another direction.

The American financial giant and its Brazilian partners have plowed hundreds of millions of dollars into farmland deals in the cerrado, a huge region on the edge of the Amazon rain forest where wooded savannas are being razed to make way for agricultural expansion, fueling environmental concerns.

In a labyrinthine endeavor, the American financial group and its partners amassed vast new holdings of farmland despite a move by Brazil’s government in 2010 to effectively ban such large-scale deals by foreigners.”

For obvious reasons anticipating regulatory push-back against this proposal, TIAA got a clause to withdraw if too much questions are asked or restrictions proposed.

What is the public benefit? The fact that TIAA is run by a former FRB vice chairman militates even more strongly for the requested public hearings."

October 24, 2016

Lending Discrimination Kills Mergers as BancorpSouth Withdraws, ICP Proceeds on People's United

By Matthew R. Lee

NEW YORK, October 22 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to People's United Bank now trying to buy Suffolk County National Bank while barely lending to people of color in New York.  Inner City Press / Fair Finance Watch on August 13 challenged this application and People's United, as it did BancorpSouth in 2014, which led to redlining charges by the Department of Justice and Consumer Financial Protection Bureau.

After BancorpSouth settled the redlining charges, Inner City Press / Fair Finance Watch immediately wrote to the Federal Reserve urging that its pending merger applications be denied or withdrawn. Now the latter has happened. The Fed has informed Inner City Press of the formal withdrawal of BancorpSouth's application; we've published the letter here, and will stay on this, to December 2017, as long as it takes.

As to People's United, using the just-released 2015 Home Mortgage Disclosure Act data. Inner City Press has now commented to the Federal Reserve:

 "in 2015 in the New York City MSA, People's United made 110 home purchase loans to whites and only ONE to an African American and only four to Latinos...  In 2015, for refinance loans in the New York City MSA, People's United made 103 loans to whites, only five to African Americans and only two to Hispanics.

   People's United record is scarcely better on Long Island, where it snapped up Bank of Smithtown and Citizen's Bank as it now proposes to do to Suffolk County National Bank. In 2015 for home purchase loans on Long Island People's United made 49 home purchase loans to whites, only four to African Americans and only four to Latinos. For refinance loans it mad 70 loans to whties, only one to an African American and only four to Latinos. Again, this is systematic redlining; this proposed acquisition could not legitimately be approved and People's United should be referred for prosecution for redlining by the Department of Justice and CFPB."

  Responding to ICP and NCRC, People's claims that acquiring another suburban bank would improve this disparate record in New York City. How?

October 17, 2016

ICP Challenges FNB's Reach into the Carolinas for Yadkin Bank, Disparities in Baltimore & Ohio, Insiders

By Matthew R. Lee

NEW YORK, October 15 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to FNB / First National Bank of Pennsylvania now trying to buy Yadkin Bank in the Carolinas while barely lending to people of color in Baltimore, Cleveland or Akron.

 Inner City Press / Fair Finance Watch on October 15 challenged this application and FNB, as it did Bancorp South in 2014, which led to redlining charges by the Department of Justice and Consumer Financial Protection Bureau.

Using the just-released 2015 Home Mortgage Disclosure Act data, Inner City Press has commented to the Federal Reserve in Washington and Cleveland:

 "On behalf of Inner City Press/Fair Finance Watch (ICP), this is a timely first comment opposing and requesting an extension of the FRB's public comment period on the Application of F.N.B. Corporation to acquire Yadkin Financial and Yadkin Bank. This first comment is timely.

F.N.B. Corporation's lead bank, First National Bank of PA, has a disparate record of lending, for example in the Baltimore and Cleveland MSAs, below. Yadkin is an amalgam of banks slapped together by private equity investors, who would be the primary beneficiaries of this proposed deal. But what is the public benefit?

In the Baltimore MSA in 2015, the most recent year for which Home Mortgage Disclosure Act data is publicly available and not taken into account in any FNB CRA example, FNB made 86 home purchase loans to whites and only 3 to African Americans, only two to Latinos. This is inconsistent with the demographics of Baltimore, to put it mildly. FNB's denial rate for African Americans was 2.75 times higher than for whites; it was 3.13 times higher than for whites. This is redlining; this proposed acquisition could not legitimately be approved and FNB should be referred for prosecution for redlining by the Department of Justice and CFPB.

People's United record is scarcely better in the Cleveland MSA, another out-of-Pennsylvania market that would be a predictor of how FNB would (under) perform in the Carolinas. In the Cleveland MSA in 2015, FNB made 297 home purchase loans to whites and only 12 to Africans and only 3 to Latinos, applications from which it denied 4.13 times more frequently than whites.

In the Akron, Ohio MSA in 2015, FNB made 41 home purchase loans to whites, only one to an African American (in Table 4-1) and none to Latinos.

In this context, the comment period should be extended so that public evidentiary hearings can be held, and the application should be denied.

Please also note for the record: “Using Tuesday’s closing price on the NYSE, here’s how much more the top 10 individual backers’ stakes will be worth at close, according to FactSet Research:

Adam Abram, lead independent director: $14,298,826.15

Michael Patterson, director: $6,969,354.35

Scott Custer, CEO: $3,836,876.80

Harry Spell, board member: $3,453,074.25

Joseph Towell, chairman: $2,705,434.65

David Brody, board member: $1,645,403.35

Steven Lerner, board member: $1,311,405.15

Steven Jones, chief banking officer: $1,285,450.00

Barry Dodson, board member: $1,117,767.15

Terry Earley, CFO: $1,030,739.45

Insiders currently own about 12 percent of Yadkin, with the bulk, at 67 percent, owned by institutional investors.”

See also:

"The prominent level of private-equity ownership in the Raleigh bank had many analysts and financial experts convinced that it would be sold sooner than later, even though Yadkin just completed on March 1 its $456 million purchase of Greensboro-based NewBridge Bancorp. NewBridge went on a three-bank buying spree after securing $56 million in new private-equity capital in November 2012.

Meanwhile, Yadkin gained $45 million in private-equity capital in October 2012 and subsequently bought VantageSouth Bancshares Inc. of Raleigh and NewBridge. Those private-equity infused deals provided Yadkin with a sufficient branch coverage of North Carolina’s three urban areas to convince FNB Corp. executives to leapfrog over Virginia to make its $1.4 billion offer.

Stone Point Capital LLC, LY Holdings LLC and Lightyear Capital LLC each own 4.46 percent of Yadkin’s 50.84 million outstanding shares. Stone Point and Lightyear were provided with a representative on Yadkin’s board of directors. At $27.35 a share, the sale could be worth $61.2 million for each firm.”

This is a proposal driven by these private equity investors: but what is the public benefit?
 

October 10, 2016

ICP Protests BNC - High Point, 2015 Lending Fell 80% from 2014

By Matthew R. Lee

NEW YORK, October 4 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to Bank of North Carolina (BNC), whose proposed acquisition of High Point Bank Corporation Inner City Press has challenged and the Federal Reserve has asked questions on, and BancorpSouth, which Inner City Press protested for discrimination in 2014, and has now been charged by the Department of Justice and CFPB.

On the evening of August 24, the Federal Reserve asked BNC questions about Inner City Press' protest, including:

"The public comment submitted on the proposed merger includes assertions that Home Mortgage Disclosure Act data from several metropolitan areas indicate that both BNC Bank and High Point Bank had unfavorable levels of mortgage lending to African American and Hispanic individuals as compared to white individuals."

Now while BNC brags it will close its deal by the end of October, Inner City Press has just submitted a second comment with the just released 2015 HMDA data. BNC's conventional home purchase lending to African Americans in the Charleston MSA has falling by over 80% from 2014 to 2015. Inner City Press has today submitted to the Federal Reserve:

"this, with Compliance Plan withheld, is the record of the proposal acquirer: in the Charleston MSA in 2014 for conventional home purchase loans, BNC made 173 such loans to whites and only SIX to African Americans, and none to Latinos. For refinance loans, it made 68 loans to whites and only ONE to an African American, while denying the applications of African Americans 3.94 times more frequently than those of whites.

  In 2015, things got substantially worse. For conventional home purchase loans in the Charleston MSA in 2015, while BNC made 45 such loans to whites, it made only ONE to an African American (down from six in 2014).  This application should be denied. We ask for more time to comment on this 2015 data.

On the current record, hearings should be held and the application(s) should not be approved. The comment period must be extended."

 The Winston-Salem Journal reported: "regulatory approval was delayed in part by two New York advocate groups challenging BNC's lending practices involving minority and underserved applicants in its markets. Inner City Press and affiliate Fair Finance Watch filed a protest with the Federal Reserve under the federal Community Reinvestment Act. It is a normal practice of those groups to challenge minority-lending practices when a significant bank purchase is announced. Fed officials asked for additional information Dec. 2. BNC responded and asked that its minority-lending data remain confidential. Rick Callicutt, the bank's chief executive and president, said in April that because BNC has surpassed $5 billion in total assets, it faces "a higher level of expectation to market more heavily to the underserved in its markets. All our Community Reinvestment Act exams have been good."

  Really? BNC's conventional home purchase lending to African Americans in the Charleston MSA has falling by over 80% from 2014 to 2015.

October 3, 2016

The Fed on September 30 said, "Of the 42 proposals withdrawn in the first half of 2016, 20 proposals were withdrawn at the initiative of the applicant. The remainder were withdrawn after consultation with staff for technical or procedural reasons or because the proposals raised significant issues regarding the statutory factors that must be considered by the Federal Reserve. Specifically, 13 of these proposals raised financial and managerial issues as well as regulatory compliance and CRA and fair lending issues."

  So what about BancorpSouth? Or a Spanish bank down the pike?

 The Federal Reserve has responded to Inner City Press' FOIA request about BNC - but has, tellingly, redacted everything about "Enforcement Actions." We are not convinced.

September 26, 2016

And now more questions from the Fed to BNC:

"on Bank of North Carolina, Thomasville, North Carolina (“BNC Bank”), to acquire High Point Bank Corporation (“HPBC”), parent of High Point Bank and Trust Company (“High Point Bank”), both of High Point, North Carolina, pursuant to section 3(a)(5) of the Bank Holding Company Act of 1956, as amended (“BHC Act”), the following additional information, including the information in the confidential appendix, is requested. Supporting documentation should be provided as appropriate.
1. Given BNC’s rapid expansion, describe in detail BNC’s merger and acquisition processes for targeting, acquiring, and integrating acquired businesses. Include the level of board and senior management oversight and reporting, due diligence activities, audit coverage, and the involvement of risk control groups as appropriate.
2. Describe how BNC governs significant project activities and whether there is an independent oversight function that oversees project changes that occur when BNC makes an acquisition.
3. Regarding BNC’s current enterprise risk management, respond to the following:
a. Discuss the impact that the integration of Southcoast has had to BNC’s risk management framework.
b. Indicate whether risk reporting includes information regarding integration activities. If so, describe how this information could be used by senior management to allocate the necessary resources to address integration concerns, should any arise.
c. Describe how BNC’s risk management framework would change upon consummation of the proposed transaction.
4. Provide a pro forma list of shareholders who will own, control, or hold with the power to vote 5 percent or more of the voting shares of BNC upon consummation of the proposed transaction. Your response should indicate whether any identified shareholder is a bank or bank holding company. In calculating the voting ownership, include any warrants, options, and other convertible instruments, and show all levels of ownership on both a fully diluted and on an individually diluted basis. Aggregate the interests of any related shareholders."

September 19, 2016

So Bank of Oklahoma, after Inner City Press' protest, was asked in what markets it will improve. It has now named cities in six states. We'll see....

September 12, 2016

After ICP Challenges Its Suffolk Bid, People's United Calls NYC "Lower Hudson," Recent

By Matthew R. Lee

NEW YORK, September 8 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to People's United Bank now trying to buy Suffolk County National Bank while barely lending to people of color in New York.  Inner City Press / Fair Finance Watch on August 13 challenged this application and People's United, as it did Bancorp South in 2014, which led to redlining charges by the Department of Justice and Consumer Financial Protection Bureau.

On September 7, the General Counsel of People's United Robert E. Trautmann filed a response, which as to the analysis of New York City redlining submitted by Inner City Press / Fair Finance Watch argues that the disparities are OK because People's supposedly only recently entered the market.

  But it entered in 2010. How long can it call this recent? And why should it be permitted to build itself up on Long Island while this redlining of New York City's lower income communities of color persists?

Tellingly, People's United Bank's purported response to Inner City Press' redlining analysis calls New York Times the “Lower Hudson Valley region.”

  Inner City Press / Fair Finance Watch filed with the US Office of the Comptroller of the Currency:

"a timely first comment opposing and requesting an extension of the OCC's public comment period on the Application by People's United to buy The Suffolk County National Bank of Riverhead, NY. The newspaper notice says the comment period runs at least through August 16; this comment is timely.

People's United proposes to buy Suffolk County National Bank and its 27 branches in New York. But in the the New York City MSA in 2014, the most recent year for which Home Mortgage Disclosure Act data is publicly available, People's United made 82 home purchase loans to whites and NONE to African Americans or Latinos. This is redlining; this proposed acquisition could not legitimately be approved and People's United should be referred for prosecution for redlining by the Department of Justice and CFPB.

For refinance loans in the New York City MSA in 2013, People's United made 24 loans to whites, 1 to an African American and four to Hispanics. For home improvement loans in the New York City MSA in 2013, People's United made eight loans to whites, and NONE to African Americans or Latinos.

People's United record is scarcely better on Long Island, where it snapped up Bank of Smithtown and Citizen's Bank as it now proposes to do to Suffolk County National Bank. In the Nassau-Suffolk MSA in 2014, People's United made 48 home purchase loans to whites and NONE to African Americans. For home improvement loans it made 16 loans to whites and NONE to African American or Latinos.

In this context, the comment period should be extended so that public evidentiary hearings can be held, and the application should be denied."

September 5, 2016

Inner City Press / Fair Finance Watch has been looking at the Bank of Oklahoma, noting that

In the Kansas City MSA in 2014 for home purchase loans, BOK for Table 4-2 made 242 loans to whites and only eight to African Americans. People of color were confined to Table 4-1 loans: 35 to African Americans, and 36 to Latinos, versus 204 to whites.

In the Houston MSA in 2014 for refinance loans, BOK made 126 loans to whites and only six to African Americans; it had a denial rate for African Americans of 55%, and for Latinos of 52%, versus only 30% for whites.

In the Phoenix MSA in 2014 for refinance loans, BOK made 168 loans to whites and only THREE to African Americans and 11 to Latinos; it had a denial rate for Latinos of 36%, versus only 26% for whites.

Now, as if on cue, BOK serves up a new Community Reinvestment Act performance evaluation as a rebuttal. But even it lists Low Satisfactory rating in Arizona and Texas for lending, in Arkansas and Colorado for service, and in Maryland for both lending AND service.

So what rating do you think the OCC gave Bank of Oklahoma, which is trying to buy Missouri Bank and Trust in Kansas City? And what Kansas City bank do you think hasn't had a CRA exam in nine years? Watch this site.

August 29, 2016

ICP Protested BNC - High Point, Now Fed Asks Questions, Here

By Matthew R. Lee

NEW YORK, August 24 -- The lack of seriousness in US bank regulation grows from the relatively smaller to the largest banks like Goldman Sachs - down to Bank of North Carolina (BNC), whose proposed acquisition of High Point Bank Corporation Inner City Press has challenged and the Federal Reserve has asked questions on, and BancorpSouth, which Inner City Press protested for discrimination in 2014, and has now been charged by the Department of Justice and CFPB.

On the evening of August 24, the Federal Reserve asked BNC questions about Inner City Press' protest, including:

"The public comment submitted on the proposed merger includes assertions that Home Mortgage Disclosure Act data from several metropolitan areas indicate that both BNC Bank and High Point Bank had unfavorable levels of mortgage lending to African American and Hispanic individuals as compared to white individuals.

-Directly address the assertions of unfavorable levels of mortgage lending to those population segments identified by the commenter in each relevant geographic area referenced in the comments;

-Discuss in detail the outreach and marketing activities by BNC Bank and High Point Bank, including any contemplated changes to those activities after consummation of the proposal; and

-Describe in detail the fair lending risk management policies and procedures of BNC Bank and High Point Bank, including any contemplated changes to these policies and procedures after consummation of the proposal...

 Discuss any plans to open, close, or consolidate any bank branches in connection with the proposal, or separately from the proposal, particularly in low- and moderate-income (“LMI”) areas. To the extent that any branches in LMI areas would be closed, discuss management’s plans to mitigate the impact of such closures on the affected communities."

On BNC, Inner City Press / Fair Finance Watch has raised to the Federal Reserve:

In the Charleston MSA in 2014 for conventional home purchase loans, BNC made 173 such loans to whites and only SIX to African Americans, and none to Latinos. For refinance loans, it made 68 loans to whites and only ONE to an African American, while denying the applications of African Americans 3.94 times more frequently than those of whites.

  Southcoast in the Charleston MSA in 2014 for conventional home purchase loans made 136 such loans to whites and NONE to African Americans. For refinance loans, Southcase made 35 loans to whites and only TWO to African Americans. To combine these two banks would make them worse.

  In the Greenville MSA in 2013 for home purchase loans, BNC made 117 such loans to whites and only SIX to African Americans, and only seven to Latinos.  For refinance loans, it made 31 loans to whites and only one to an African Americans and none to Latinos.

  BNC admits, as it must, that it is below-market in lending to African Americans, but paradoxically tries to use that the fact that it is subject to a compliance order as its defense to the Fed.

 To Fair Finance Watch, too. FFW asked to see, in writing, what are BNC's CRA plans going forward. BNC replied that it is "unable to share this with you. It is an internal document that is only shared with our Board of Directors and the FDIC (under the Order)."

  We'll have more on this.

August 22, 2016

Last week, Inner City Press / Fair Finance Watch challenged People's United - Suffolk County National Bank. Now: "Elizabeth Montgomery, a People’s United spokeswoman, said the bank does not comment on pending litigation, but noted that it feels “comfortable” with its lending practices. “We’re a highly regulated institution and we’re very proud of our history of residential lending and we’re comfortable with our practices,” she said. Suffolk did not return a call for comment."

  We'll have more on this.

For BancorpSouth, which Inner City Press has challenged for some time, the other shoe has dropped. It announced: "As a result of the retroactive downgrade of the bank’s CRA rating, the company and the bank likely will be unable to obtain the necessary Federal Reserve or FDIC regulatory approvals to complete the two pending mergers with Ouachita Bancshares Corp. and Central Community Corporation and their respective affiliated banks until such time as the bank’s CRA rating is improved to “satisfactory.” The company presently understands that the FDIC expects to begin its next CRA evaluation of the bank later this year and to complete that evaluation during the first quarter of 2017; however, the company cannot make any assurances as to the timing or outcome of its next CRA evaluation."

August 15, 2016

Citing Redlining, ICP Challenges People's United Bid For Suffolk County