Home > Banking Information & Regulation > Public Meeting Transcripts > PMT - Agendas July 9-10, 1998
Public Meeting Transcripts
Public Meeting Regarding NationsBank and BankAmerica
Thursday, July 9, 1998
Transcript of Panel Seven
215 9 MS. SMITH: All right. Thank you. If we 10 can start, please 11 MR. BROWN: Good afternoon. My name is 12 Keith Brown and I am from Kansas City, Missouri. I am 13 a minister, a community activist, I am the Executive 14 Director of an organization called Project 15 Neighborhood, and the focus of Project Neighborhood 16 is to work with service providers, community groups 17 and coalitions and neighborhoods to restore 18 neighborhoods to safe, drug-free, economically-viable 19 communities. 20 One way that we feel if we're going to get 21 a real hold and grip on the problem of substance abuse 22 is really to develop the economic infrastructure and 23 commercial infrastructure of the urban core in Kansas 24 City. 25 And NationsBank, without fear of 26 successful contradiction, marvelous things have begun to 216 1 take place in our community. Because and as a result of 2 the partnership with the NationsBank under the 3 leadership of the regional president William, Bill, 4 Nelson, a Rainbow Coalition has developed. For the 5 first time, people of color, clergy, community 6 activists, city planners, civic leaders, have gathered 7 themselves around the table to really -- not only to 8 discuss but to strategically plan on how are we going to 9 rebuild the infrastructure, the economic infrastructure 10 of the urban core of Kansas City, Missouri. 11 What has taken place is that we have had 12 the opportunity to go on tours in the community to see 13 what some of the problems and the concerns are relative 14 to redevelopment and development. For the record, I 15 have a video that, you know, illustrates that as well as 16 a pictorial presentation that illustrates that. I'm 17 going to turn that in. 18 We feel that if NationsBank -- they have a 19 marvelous track record, and if they have been able to do 20 what they are embarking on in our community in terms of 21 really enhancing the viability and the aspirations of 22 that community, if they can do that by themselves, then 23 we feel that a merge with them and BankAmerica will only 24 increase and enhance what we are striving and what we 25 have begun to do in the City of Kansas City, Missouri. 26 So I and we, as grass root participants, 217 1 members of the clergy, and neighborhood residents who 2 historically are left behind, are not at the table when 3 it comes to planning, when it comes to what's going to 4 take place in a community, they are at the table and we 5 are in support of this merge and we have a strong leader 6 in William, Bill, Nelson, who is the president of the 7 regional, you know, chapter, branch of NationsBank. 8 So I wanted to share that with you. The 9 proof is in the pudding right here. So we're going to 10 turn this in. 11 MS. SMITH: Thank you. 12 MS. CONEY: Good afternoon. Thank you for 13 allowing me to come today. My name is Chloe Coney, and 14 I'm President and CEO of Corporation Development 15 Communities of Tampa, Choice CDC of Tampa. 16 CDC of Tampa is a community-based 17 development corporation located the second highest 18 poverty area, only second the Liberty City in Miami. My 19 neighborhood, East Tampa, which is College Hill, Bellman 20 and Jackson Height has been known in the past for 21 highest decay and disinvestment. 22 Nine years ago, Alex Sinc, President of 23 NationsBank, Florida, adopted our blighted, distressed 24 neighborhood, East Tampa. NationsBank pledged their 25 support by working with our Mayor's Challenge Fund 26 Housing providing loans to low-income families. 218 1 NationsBank branch office is located in 2 our community and provides excellent service to the 3 residents. The six years of CDC Tampa, Inc. existence, 4 NationsBank has been a strong partner. 5 NationsBank has provided leadership to our 6 community through their staff with countless hours of 7 volunteering. Joe Vickersian, Mary Ellen Camilla serves 8 on my board, and, now, Mary Beth Stoltz, who is with 9 NationsBank CDC. 10 One of NationsBank employee won the 11 community service award and donated our CDC as a 12 nonprofit. 13 Our community-building project, the NEMY 14 [phonetic] community building brick by brick is located 15 in the worst of the worst neighborhood, the drug 16 affected neighborhood. You all know what I'm talking 17 about in the inner city. 18 We are rehabing old laundromat, rehabing 19 old bar, and we're going to do an indoor-outdoor food 20 market. NationsBank stepped to the plate and made a 21 financial contribution. 22 Many of the banks did not want to take 23 that kind of risk. So, again, I'm excited about 24 partnering with NationsBank CDC to build the first, the 25 very first, multi-family housing, a $2 million project, 26 in East Tampa in over 30 years. 219 1 We're also looking forward to building new 2 single-family housing in our blighted, distressed area. 3 Tampa, Florida, East Tampa neighborhoods 4 is like Atlanta, Georgia, Summerhill and the black 5 historic district. We want to continue to work with 6 NationsBank CDC to rebuild and create a strong, safe 7 prosperous, wealth building community. 8 As with the merge of Barnett Bank in 9 Florida, I challenge nonprofit organizations located in 10 blighted, distressed neighborhoods to sit at the table 11 to represent your neighborhood. 12 Again, NationsBank has been there for our 13 poor inner city neighborhoods. I do recommend the 14 merger and I will be sitting at the table. Thank you. 15 MS. SMITH: Thank you. 16 MR. PRICE: Thank you. Good afternoon, my 17 name is Hugh Price. I am President of the National 18 Urban League headquartered in New York City. We were 19 founded in the 1950s to assist African Americans who 20 were making the transition to rural cities. Today our 21 goal is to help African Americans and other people with 22 color to become self-reliant and equal citizens under 23 the law. 24 Through our economic self-sufficiency 25 agenda, the Urban League developed partnerships with 26 national institutions like NationsBank. As a result of 220 1 these relationships, the Urban League is in a key 2 position to discuss recommendation of performance and 3 commitment in serving color. 4 We support the merger of NationsBank and 5 Bank of America because we have a long history in 6 partnership with NationsBank. Through this partnership 7 we have seen NationsBank commit to ensuring that African 8 Americans and others of color have access to credit and 9 communities that are highly available. 10 I'd like to highlight the record of 11 NationsBank's performance first. President of Community 12 Initiatives, Cathy Bessant, testified before Congress, 13 Senator DeMoto, along with community groups on the 14 strength in maintaining the Community Reinvestment Act. 15 It was unique to find a lending 16 institution willing to sit on the same panel with 17 controversy groups and offer support and testimony on 18 behalf of CRA. This act is a commitment to extending 19 credit to those who have been traditionally neglected. 20 Second, NationsBank commitment to the 21 prevention and eradication of differential treatment at 22 the branch level. Through its mystery-shopping 23 initiative, NationsBank conducts self-testing at the 24 branch level to detect patterns of differential 25 treatment by its own employees. We think that 26 NationsBank's interest in policing itself demonstrates 221 1 foresight, and that is another reason why we support its 2 application to merge. 3 Third, the bank has made a commitment to 4 lend $10 billion over the next ten years to underserved 5 communities. Within a four-year period NationsBank has 6 not only met its commitment but exceeded it by providing 7 $13 billion to communities. We are confident the bank 8 will exceed its $350 billion commitment to underserved 9 communities. 10 Fourth, NationsBank pledged to provide $25 11 million to community development financial institutions, 12 through its own CDFI fund. Again, NationsBank showed 13 courage and commitment when it announced the 14 establishment of its CDFI fund on the same day that 15 President Clinton signed the federal CDFI fund law. It 16 was NationsBank's view that their fund would complement 17 the Federal Government's effort to finance CDFIs. We 18 view their announcement of $25 million CDFI fund as 19 another sign of its commitment to increasing access to 20 credit for traditionally underserved communities. 21 Fifth, NationsBank held BluePrint 2000. 22 This was a convening of nearly 500 community leaders 23 from 111 urban and rural communities across the country. 24 The event marked a -- served as a retreat and think tank 25 for community groups to seriously ponder the viability 26 of their neighborhoods. 222 1 Finally, let me add that NationsBank has 2 been very aggressive in advancing African American 3 executives up the ladder into positions of 4 profit-and-loss responsibility for major business units. 5 Its impressive track record could be and should be 6 emulated by other financial institutions. 7 We strongly support the continuation and 8 extension of the Community Reinvestment Act. We think 9 there is much more work to be done in this country on 10 rebuilding low-income neighborhoods and the commitments 11 must be strong and firm and must be even bigger than 12 ever before. 13 We look forward to seeing the lightened 14 philosophy of NationsBank extent throughout the entire 15 footprint of the new bank. We believe that the new bank 16 offers the opportunity for unprecedented economic growth 17 in communities that we serve and as a result the new 18 bank will create new venues for venture capital, will 19 enhance the level of mortgage credit to low-income 20 communities and will help revitalize economically 21 distressed neighborhoods. 22 Again, we support the proposed merger. 23 Thank you. 24 MS. SMITH: Thank you. 25 MR. PEDRON: Good afternoon, and thank you 26 for the opportunity to present testimony before you 223 1 today. My name is Eduardo Pedron. I'm the president of 2 Miami Dade Community College in Miami, Dade County, 3 Florida, serving 127,000 students. 4 I'm here today, though, to present my 5 community perspective on this issue. I most agree that 6 when mergers of this magnitude take place none of 7 society in concern develop in the various communities 8 throughout the nation. Such was the case when 9 NationsBank acquired Barnett Bank, Florida's largest 10 bank. The level of inciting our community was very high 11 and I have to confess that I myself had serious concerns 12 about it. 13 However, I think the record of NationsBank 14 during this acquisition, this merger, is one that has 15 encouraged me to support the merger with BankAmerica, 16 because I really feel that their track record has been 17 exemplary. 18 I want to be very brief and mention three 19 or four examples that I think are very indicative of the 20 level of sensitivity that NationsBank has shown in this 21 regard. 22 First of all, I have seen during that 23 merger for them to go through significant effort to fold 24 the local management into the new organization, with a 25 special attention to minority members. Both Hispanic 26 African Americans and others. This has provided for a 224 1 significant degree of continuity and something the 2 community has applauded. 3 The other aspect, which I think has been 4 significant, is the involvement in civic and community 5 affairs with a special reference to inner city issues 6 and education issues. 7 Not only has NationsBank respected 8 previous programs that were supported by the -- by 9 Barnett Bank, but, frankly, we have seen that 10 participation heightened and efforts such as Take Stock 11 in Children, which is a program throughout Florida to 12 provide and guarantee poor children the opportunity for 13 a college education, has been enhanced, and I could go 14 on and on with many many initiatives that we have seen. 15 Also something that is very indicative of 16 that sensitivity is the fact that they have incorporated 17 many of the former members of Barnett adviser, local 18 advisory boards into their advisory boards, and 19 especially minority members. And I think if the Miami 20 experience is indicative of what has happened in the 21 rest of the country, we have seen most of the former 22 members of the advisory board of Barnett Bank been 23 applauding to the NationsBank advisory board. And they 24 have gone beyond that to seek and make sure that they 25 have the support and the advice of members of the 26 community which is something that you rarely see in 225 1 terms of banking institutions. 2 Finally, I'd like to mention that the -- 3 we have seen with great enthusiasm the fact that 4 NationsBank has taken the necessary step to strengthen 5 national strategic partnerships with national 6 organizations like the NAACP and the council of La Raza, 7 the Urban League and many others. So I feel this is a 8 good sign. 9 For a state such as Florida, and there are 10 other states, which Bank of America has not had a 11 significant presence, this is something that our 12 community is welcoming, in my opinion, because you take 13 a state like Florida with a very strong and growing 14 business activity in the whole area of international 15 trade and finance and with Bank of America 16 well-established presence throughout the world, we feel 17 that this will be to the benefit of our economy and to 18 the benefit of businesses that are involved in 19 international trade and finance. 20 So I'm here very gladly to support this 21 merger and pleased to do so at this time. Thank you. 22 MS. ROBERTSON: My name is Ellen Robertson 23 and I'm from Richmond, Virginia. and I'm the Executive 24 Director of HP Wrap which is a nonprofit community 25 development organization. I'm also a partner with 26 NationsBank in the development of a target neighborhood 226 1 development program in the community by the name of 2 Highland Park. 3 I'm honored to be here and to participate 4 in this public hearing on behalf of NationsBank and to 5 also have this great opportunity to express our thanks 6 for the services that NationsBank has provided in the 7 development of that community. 8 We especially want to recognize bank 9 leaders Doug Crukshank, James Jackson, Marsha Woody and 10 Cindy Mimms for their outstanding leadership and 11 demonstration of their interest in community 12 reinvestment. It's because of the services that they 13 have provided that I am confident that this merger is in 14 the best interest for all parties at stake. 15 I'd like to first give you a general 16 overview of the community that I'm speaking of. It's an 17 urban community that is located in the heart of Richmond 18 that is home for about 8,000 residents, which consists 19 35 percent of very low income, 50 percent single family 20 head of household and the remaining largely blue class 21 homeowners and renters. 22 In 1989 a group of residents in which I 23 was one of formed this nonprofit HP Wrap for the purpose 24 of revitalizing the community. NationsBank at that 25 time, a sovereign bank, was the first to come to our 26 support. They have served on our board since that time 227 1 and supported us to be the first organization in the 2 United States to influence HUD to provide first-time 3 grants to qualified buyers to purchase their first home. 4 Today this is a national program. 5 Since 1989 until today, nine years, 6 NationsBank support in providing home purchase training 7 has resorted in 342 new families having purchased their 8 first home in Highland Park. I'd like to thank 9 NationsBank. Highland Park has more than 10 2,000 homes, most historic two-story Victorian homes 11 with 2,000-plus square footage of space nested on large 12 lots and accessible by tree-lined streets. 13 Due to the block busting and redlining of 14 the -- in 1960 transition resorted to flight and we are 15 now living are blight. More than 300 homes are 16 abandoned in this community. NationsBank supported HP 17 Wrap purchasing and restoring one of these abandoned 18 homes to serve as the neighborhood model Victorian sales 19 center to market a historic restorated development plan. 20 NationsBank provided the funds to restore 21 the model, to serve as the center and completed the 22 furnishing. Due to this creative investment, we now 23 sell an average of 15 restored abandoned homes to 24 first-time buyers. NationsBank invests 65 25 to 75 percent of the total development cost using very 26 workable flexible terms and lines of credit for 228 1 construction, property acquisition and permanent 2 mortgage financing. In addition, two new products are 3 being developed to provide existing owners equitable 4 rehab loans as well as second mortgage. 5 Again, we thank NationsBank. 6 In nine years NationsBank investment in 7 Highland Park has impacted property values increased by 8 65 to 85 percent and 448 homes have been sold to new 9 buyers and/or rehab work done on them. 10 NationsBank makes direct leveraging 11 contribution to support people, growth and development 12 specifically to support volunteerism and youth 13 development. 14 Our children are operating in neighborhood 15 school greenhouse to redesign the urban landscape for 16 public safety. 17 NationsBank has also supported directly 18 the development of programs to deal with increase crime 19 that we have in the community. 20 Because of NationsBank investment over the 21 last couple years, we have been successful in bringing 22 an additional $1.5 million in the United States Americor 23 National Volunteer Service to our community to deal with 24 crime issues. 25 Because of NationsBank leadership, we are 26 now receiving large contributions from other public and 229 1 private sources, corporations and foundations. We 2 assess NationsBank contribution directly to our 3 community at a rate of 3.5 to 5 million annually. 4 To maintain the community development 5 orientation, five characteristics of NationsBank is 6 encouraged to be continued as part of this merger. 7 Number one, we ask that we keep local branches in 8 Highland Park community types. Your bank serves as 9 anchors to the neighborhood development successes. 10 Number two, we ask that you maintain the 11 sensitivity to hiring staff at all levels reflective of 12 the cultural diversity of the neighborhood population 13 served. 14 Number three, we ask that you continue to 15 be simple. Don't get big, keeping -- don't let your big 16 keep you from being small. We love people that have 17 smiling faces that are set across the table from us to 18 help work out things to make things happen in our 19 community. 20 And, number four, we ask that you maintain 21 your neighborhood target development strategy. 22 And, finally, number five, we ask that you 23 regulate bank relocation, that it does not influence or 24 contribute to urban sprawl which is the leading cause 25 for urban decline. 26 I thank you for this opportunity to speak 230 1 and we strongly support the application for the merger. 2 BISHOP BATTLE: I am Bishop George Battle. 3 One of 12 Bishops of Episcopal Zion Church consisting of 4 3.5 million members worldwide. 5 I wrote a speech, but I am going to give 6 you this and speak from my heart. 7 MS. SMITH: Thank you very much. 8 BISHOP BATTLE: Number one, I've known 9 NationsBank, NC&B Bank, before they became NationsBank, 10 for 25 years. I am privileged to say this bank has 11 always been involved in the community. 12 I can recall going to Mr. McColl's office 13 as a young pastor store living in a parsonage where the 14 members felt, you know, the minister should have a good 15 house. I went in there with no money, no credit, met 16 with Mr. Mc Call and said, "I want a house." Interest 17 rate was 21 and a quarter percent. I am pleased to tell 18 you, I not only got the house at nine and a quarter 19 percent, but since that time I moved into even a bigger 20 house. 21 NationsBank, that's not necessarily 22 because of me, I know of a young man in St. Louis, just 23 several months ago who had a terrible financial problem. 24 He needed help. He called me, I called NationsBank, he 25 received in three days $6,000. 26 If you ever come to Charlotte and you hear 231 1 talk of a Gethsemane Enrichment Program, a program that 2 works with the Lord's underprivileged, a social 3 development program in the community. 4 Some 500 kids in 1974 received a national 5 award from President Bush as one of the best programs of 6 its kind in the nation. You will find that NationsBank 7 have supported that program with hundreds of thousands 8 of dollars before any other corporate contributor put 9 one dime in. 10 I can recall one session with Mr. McColl 11 brought the community in, these were the most low 12 economic development persons in the community. We told 13 him that we needed housing and three of the communities 14 where we work were the poorest kids in the neighborhood. 15 Those communities have been completely 16 redeveloped by NationsBank. Oh, by the way, I'm a 17 member of First Union Bank, so you ought to know that. 18 So I have no invested interest other than telling the 19 truth. 20 If all of the banks incorporated in 21 America was successful to the culture and to the people 22 that work in high management position at NationsBank, 23 your job would be a lot easier. I am pleased the tell 24 you that just several months ago my school -- 25 (interruption.) 26 I hope you all aren't going to hold that 232 1 against me. Thank you, I have to start all over again. 2 Remove that. 3 In 1994 Livingston College, a small 4 historical black college 30 miles north of Charlotte, 5 was facing very, very financial difficulties. No other 6 institution would make a loan. I went to Mr. McColl, we 7 received $7 million that not only put us in terms of 8 ahead of where we were but now we are probably the only 9 small black college in America that have internet 10 capability for every student. That's a plug for 11 Livingston College. 12 In addition to that, they also made a 13 grant in helping that school in excess of -- over the 14 period of five years in excess of $350,000. 15 I can also attest to the fact that we have 16 a small junior college in South Carolina that was 17 struggling with accreditation. NationsBank came to the 18 plate and loaned the school $500,000 at the low interest 19 market rate. In addition to that, through in a hundred 20 thousand dollars to hire the consultants to make sure 21 that the school would be a credit for a minority student 22 that could not go anywhere in America because of 23 economic standards. 24 In addition to that, we could talk about 25 how they helped to completely transform Charlotte, 26 that's where I have been, and how if you ever travel 233 1 down Highway 49, that's southwest of Charlotte, you will 2 see an AME Zion church that was built there on Highway 3 49 that received all kinds of architect's award. Thanks 4 to NationsBank. 5 NationsBank, along with Mr. McColl and all 6 of the persons that work for him, you can call them on a 7 moment's notice and say, "We need a meeting. We have to 8 talk about some issues we have in our community." 9 They're always at the forefront. 10 Right here in California, right here in 11 California, one of our largest churches was set on fire. 12 NationsBank, without knowing the church, without having 13 any kind of investments, gave the church a substantial 14 contribution to help it get on its feet. 15 Birds of a feather flock together, 16 NationsBank -- when I see this sign, "NationsBank go 17 home." This can be home for NationsBank and it would 18 make this community a much, much better place, because 19 anywhere NationsBank has been they have been fair, they 20 have given minorities chances, opportunities to excel 21 and exceed. 22 And I'm here today at my own expense, I 23 couldn't even catch Mr. McColl to catch a ride, I had to 24 fly my own plane, to say that I think it would be a 25 disaster not to cause these two great things to come 26 together to provide the services for entire nation. 234 1 What a historical step we're taking today. I believe 2 with the smartness of this panel, I believe NationsBank 3 is going to prevail with the Bank of America and this 4 community is going to be better. Thank 5 you. 6 MS. SMITH: Any questions. 7 BISHOP BATTLE: Yes, I have my speech 8 submitted already. If you need me, just give me a 9 moment's notice and I'll be back. 10 MS. SMITH: Thank you very much. 11 We have no questions, so we thank you and 12 we'll go on to the next panel.
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