Home > Banking Information & Regulation > Public Meeting Transcripts > PMT - Agendas June 25-26, 1998
Public Meeting Transcripts
Public Meeting Regarding Citicorp and Travelers Group
Thursday, June 25, 1998
Transcript of Panel Fifteen
397 10 MR. LONEY: Do we have any questions 11 of this group? If not, I will thank you all 12 very much for coming. 13 We are going to do a little more 14 agenda shifting. 15 James Wyche and Lydia Tom from Panel 16 Fourteen have arrived, and, also, Douglas 17 Warens from the Sixteenth Panel is here, too, 18 and we have room. So if you would like to come 19 up now, that would be good. 20 (Continued on next page) 21 22 23 24 25 . 398 1 2 MR. LONEY: Mr. Wyche, are you ready? 3 MR. WYCHE: Sure, I am. Good 4 afternoon. I'm pleased to be present and to be 5 part of the testimony and support of the merger 6 for Citibank and Travelers Corp. 7 I represent an organization called 8 the Leadership Alliance. As executive director 9 I forged this alliance of 25 which are 10 represented by the eight Ivy League 11 institutions, the ten historic black colleges 12 there are three Hispanic serving colleges as 13 well as the seven tribal colleges in Montana 14 associated with Montana State University. This 15 is an educational alliance that was formed back 16 in 1992, and I'm pleased to tell you a part of 17 the story, because Citibank was our first 18 corporate sponsor. 19 This organization was formed with the 20 ideal of trying to reach toward under 21 representation, specifically with 22 African-American students, with Hispanic-Latino 23 students, with Native American students, and to 24 try to bring them through the process of our 25 educational system, to get them into the . 399 1 2 terminal degree process, but, more importantly, 3 to set up a monitorship program, to set up a 4 networking system by which these students would 5 then for ever be professionally enmeshed within 6 our educational system. 7 The sole purpose as we had started 8 this endeavor was to change the classroom. We 9 had hoped that we would begin to change the 10 demographics of the faculty situation in our 11 institutions as well as nationally. 12 As this organization has matured in 13 the past seven years, we found it necessary to 14 really stimulate all segments of our society, 15 and indeed, as a national institution and 16 organization we have now grown internationally 17 where we have programs in 14 different 18 countries in Asia, East-West Europe, Africa, 19 Latin and South America. 20 The important aspect of this program 21 that I'd like to also stress is our ability to 22 reach out worldwide, globally through our 23 network and forge an alliance both for the 24 students, for the faculty, the administrators 25 as well as politicians. . 400 1 2 I'm just returning from a trip to 3 Africa visiting east, south and west African 4 countries in which we're going to globalize the 5 experience for over 240 faculty and students 6 within this organization with support from 7 organizations like Citibank. 8 Now, let me tell you a little bit 9 about what Citibank has meant to us 10 specifically. Over the course of the last six 11 years in which Citibank again was our first 12 corporate sponsor, it has enabled us to train 13 over 700 students, 125 of which are now in 14 terminal degree PhD. programs, all 15 underrepresented minorities. 16 These students are ushered through a 17 system where we not only mentor them, where we 18 network them, but we expose them to highest 19 caliber educational environment that we can 20 afford within our educational system. 21 Within that system of 125 students 22 we've provided them the opportunity to also go 23 to foreign countries, to come back now wanting 24 and desiring to discover things that many of 25 them heretofore had not even thought of. . 401 1 2 I'll tell you a story also about our 3 latest key note speaker in a national symposium 4 and that is Fredrico Pe¤a, former secretary of 5 energy and Mr. Pe¤a talked about a student from 6 New York City of all places -- he obviously was 7 based in Denver -- and he talked about a 8 student who did not really know anything about 9 higher education, a student who would look in 10 the heavens and gaze and had no idea what he 11 was looking at. 12 This student came to him and talked 13 to him about his vision of what he'd like to 14 do, and as Mr. Pe¤a described this student. He 15 talked about what this student might do for 16 America and what he might do for himself. This 17 student is currently enrolled in a PhD. 18 program. 19 It gives you some idea of the power 20 of the interface with people that this 21 difference can make for these individuals. The 22 second and last of the stories has to do with 23 someone that I was interfaced with, a very 24 important story for me because, again, it 25 brings in the context of New York when I used . 402 1 2 to be here as a professor in the City 3 University Of New York. 4 One Saturday I was in my laboratory 5 and a student was draped across the door of my 6 office, and I went to see him, and this student 7 came to me and said: I've been looking for 8 you. I've come from Beliz. I said: Well, how 9 did you know me? He talked about a program 10 that I used to head here in New York City, 11 which now has been expanded as part of the 12 Leadership Alliance network and he said: I was 13 about to go back because I had just enough 14 money to JFK and take a plane back home. 15 Well, needless to say, I was 16 enthralled by the student. He enrolled, he 17 finished his degree program, he went on, he got 18 a PhD. at MIT. He then went to Bell Labs. He 19 is now a professor at Princeton University in 20 the mathematics department. 21 These are stories again that are 22 heart warming, that show that we have the 23 opportunity to really expand the human talent 24 pool, but we need corporate America. We need 25 the federal sector. We need individuals to . 403 1 2 participate, and, again, what I want to stress 3 to you, but the first corporate partner, in 4 fact, the first funder of this venture was 5 Citibank. 6 I can't tell you how important 7 Citibank continues to be in our lives. We have 8 a member, a vice-president from Citibank who 9 sits on our corporate board. 10 The important issue I'd like to leave 11 you with is simply this. The expectation of 12 the Leadership Alliance is that with this 13 merger we are anticipating that Citibank 14 Travelers will not only continue, but enhance 15 the outreach of the Alliance, not only within 16 the United States, but globally. These are 17 global organizations and these are global 18 times. We need young people who are going to 19 be competitive and see their world globally. 20 Finally, I'd like to simply say that 21 I'm hopeful that through this merger that you 22 will approve, and that it is your 23 recommendation that we will go on and do better 24 things for America. Thank you. 25 MR. LONEY: Thank you Mr. Wyche . 404 1 2 Ms. Tom. 3 MS. TOM: Good afternoon. My name is 4 Lydia Tom and I am director of housing and 5 finance for the Enterprise Foundation's New 6 York office. 7 I would like to tell you briefly 8 about Enterprise's involvement with Citibank, 9 and how the bank has partnered with Enterprise 10 in working to improve the quality of life in 11 low income neighborhoods, through the 12 development of housing and support services, 13 both nationally and in New York. 14 Citibank has been an invaluable 15 partner in helping Enterprise to provide 16 different financial resources to low-income 17 communities. Citibank has assisted us on many 18 levels; as a funder, tax credit investor and 19 loan source. 20 Enterprise and Citibank have been 21 working together since 1991. Enterprise was 22 established by Jim and Patty Rouse in 1982 to 23 provide the opportunity for low-income 24 Americans to secure decent affordable housing 25 and move up and out of poverty. Since that . 405 1 2 time, Enterprise has helped create over 86,000 3 affordable apartments nationally, including 4 8,000 in New York. 5 Citibank has worked with Enterprise 6 in many cities around the country, including 7 New York, Buffalo, Rochester, Syracuse, 8 Delaware, Maryland, the District of Columbia, 9 Florida, San Antonio, St. Louis, Nevada, and 10 California. 11 Since 1991, Citibank and the Citicorp 12 foundation have provided $987,000 in grants to 13 Enterprise and $1.75 million in below market 14 rate loans. Citibank has provided or committed 15 to provide $74 million in equity through the 16 low income housing tax credit. This $74 17 million includes $50 million invested in the 18 New York Equity Fund, as well as nearly $20 19 million in national funds that have supported 20 special needs housing in New York. This 21 housing serves the formerly homeless, the 22 elderly, those with a history of mental illness 23 or substance abuse, and those with AIDS. 24 These numbers have a real impact on 25 communities. The funds have been used to . 406 1 2 extend to low-income families for home 3 ownership, to develop affordable rental housing 4 by placing equity from Citibank in tax credit 5 eligible multifamily housing and to support 6 special programs through grants, in such areas 7 as job training and child care that improve the 8 quality of life for residents. 9 As an investor in tax credit and a 10 source of predevelopment loans, Citibank has 11 facilitated the creation of affordable housing 12 for those who need it most. You may have read 13 a recent New York Times article that noted that 14 the numbers of housing-needy families in the 15 United States outnumber affordable apartments 16 by 4.4 million. 17 The low-income housing tax credit has 18 been a valuable tool in filling this gap. 19 Citibank's total commitment to the credit will 20 help produce an estimated 1,750 safe, decent 21 affordable homes nationally. 22 Citibank is also participating in 23 Enterprise's City Home Program, an effort with 24 NYC and the Community Preservation Corporation 25 to provide home ownership opportunities for low . 407 1 2 and moderate income families. Citibank will be 3 providing mortgages for these first time 4 buyers. City Home targets smaller, abandoned 5 city-owned buildings and helps bring stability 6 to neighborhoods by transforming eye sores into 7 community assets, and bringing back owners to 8 deteriorated blocks. 9 Predevelopment loans are another tool 10 Citibank has provided for the development of 11 affordable housing. In New York, Citibank has 12 provided $1.5 million in predevelopment funds 13 over the past two years. This includes some 14 monies to upstate regions. These funds help 15 nonprofits pay for expenses such as 16 architectural and legal fees, so that 17 construction can close. 18 Support services such as child care, 19 job training and greening projects build on 20 housing and uplift the quality of life in 21 neighborhoods. Citibank has been sensitive to 22 these needs. 23 Citibank was an early funder of a 24 child care initiative Enterprise established. 25 Through this project, two facilities have been . 408 1 2 developed that provide quality child care for 3 over 200 children from low-income families. 4 Citibank also provided funds for a training 5 program connected with one of these centers 6 through which low-income women receive training 7 in the Montessori Method of early childhood 8 development while working as a teachers aid and 9 classroom assistants. This program, serving 10 about 20 women, has made it possible for 11 several participants to get off welfare and 12 pursue a career in early childhood education. 13 Citibank has also used its resources 14 to fund employment initiatives, a major concern 15 now that welfare reform has impacted 16 communities. 17 On a national level, Citibank funds 18 made it possible for Enterprise to launch the 19 Volunteer Institute in 1994. The Volunteer 20 Institute provides training for AmeriCorps 21 volunteers solicited by selected nonprofit 22 groups for community safety programs. Thanks 23 to Citibank's generosity, this program has had 24 outstanding results for people at very low 25 income levels, some of whom are having their . 409 1 2 first experience in the work world. 3 Citibank also funded a new job 4 training effort in New York called the Tree 5 Keeper Training program which will train 6 residents in low-income neighborhood in tree 7 maintenance and landscaping and link them with 8 jobs with smaller landscaping contractors 9 looking to create city-based work crews. 10 On the community level, Citibank has 11 used its resources to develop creative 12 partnerships to meet local needs. Through its 13 Culture Builds Community program, Citibank 14 funded a program implemented by Enterprise and 15 Trees New York in 1995, to plant street trees 16 along West 159th Street in Washington Heights. 17 The Community League of West 159th Street was 18 the local sponsor. 19 Residents helped plant and have since 20 cared for and maintained the trees. Not only 21 has the program helped bring greenery to the 22 block, but the care of the trees has served as 23 an organizing tool for tenant associations. 24 Finally, the leadership of Citibank 25 senior executives has been a great asset to . 410 1 2 Enterprise. Janet Thompson and Emilio 3 Fernandez serve on Enterprise advisory boards 4 in New York and Miami, respectively. 5 In New York, Janet has been 6 instrumental in examining ways in which 7 Enterprise and Citibank can contribute to a 8 more comprehensive approach to community 9 development. Other Citibank executives have 10 been very active in Enterprise New York's 11 Junior Board, a group of young professionals 12 who participate in hands-on activities in 13 neighborhoods, such as planting community 14 gardens and furnishing community rooms. 15 Citibank has been very helpful with 16 Enterprise's annual network conference, which 17 now involves over 1,300 housing professionals 18 from around the country. Citibank executives 19 have addressed the conference and participated 20 in workshops. 21 Enterprise supports the application 22 for Citibank and Travelers to merge. We hope 23 that this is an opportunity to expand services 24 to low-income communities, through the 25 combination of Citibank's existing initiatives . 411 1 2 with the resources that Travelers brings, 3 including $100 million in tax credit 4 investments made by Salomon Brothers. 5 MR. LONEY: Thank you, Ms. Tom. 6 Mr. Warns. 7 MR. WARNS: Thank you for the 8 opportunity to speak in support of Citibank and 9 their work with us. 10 I am president of the United Way of 11 Tri-State which is a regional organization 12 serving New York, Connecticut and New Jersey 13 here in the New York metropolitan area. The 14 past year we raised about $103 million from 15 about 140 regional companies of which Citibank 16 is one. 17 We distribute this money to 30 18 participating United Ways in the three-state 19 region. These United Ways provide funding to 20 1800 health and human service agencies in 21 almost every community. 22 Citibank has a major supporter of the 23 United Way for many years. Their support in 24 fact helped found our organization in 1977 and 25 prior to our founding, there was the Greater . 412 1 2 New York Fund and several other United Ways in 3 this area that they supported. We were the 4 first regional United Way to be formed here, 5 thanks to their help. 6 In 1997 Citibank donated $750,000 for 7 the United Way campaign and their generous 8 employees contributed another $1,850,000 for 9 the campaign. Since 1992 Citibank and it's 10 employees have contributed over ten million 11 dollars to the United Way in this region, that 12 doesn't count the thousands of dollars they 13 contribute elsewhere in the country. These 14 donations in conjunction with the donations of 15 all other participating companies and their 16 employees helps an estimated 6.5 million people 17 in this region, or roughly about one in every 18 three people over the past ten years. 19 In addition, Citibank encourages 20 their employees to volunteer, as you've heard 21 here, with organizations in communities to help 22 improve these communities in which they live, 23 work and receive services themselves. This 24 help, as you've heard here, also has helped 25 other nonprofits do well, as well as improve . 413 1 2 the communities and the neighborhoods, at least 3 in this region. 4 The United Way is grateful for 5 Citibank's support and believe the future 6 combined entity with Travelers will also be a 7 strong corporate supporter of health and human 8 services throughout the tri-state region 9 helping to meet critical human needs in this 10 area. Thank you very much.
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