Home > Banking Information & Regulation > Public Meeting Transcripts > PMT - Agendas August 13, 1998
Public Meeting Transcripts
Public Meeting Regarding Banc One and First Chicago
Thursday, August 13, 1998
Transcript of Panel Eleven
13 MR. PARKER: Thank you and good afternoon. 14 My name is Bernard Parker. I am the 15 Co-Chair of Alliance For Fair Banking out of 16 Detroit's coalition of organizations. They came 17 together about 12 years ago. And I'm also a Wayne 18 County Commissioner serving the East Side of the 19 City of Detroit. And I'm the Executive Director of 20 a community organization Operation Get Down for 28 21 years now. 22 I'm here to speak in support of the merger 23 for one particular reason, and that is the history 24 of what we have had in relationship to working with 192 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 National Bank of Detroit NBD in the City of 2 Detroit. 3 Back in 1986, we had a similar type of 4 situation where we came together to express some 5 real concerns about the disinvestment and the lack 6 of involvement of NBD and other banks in the City 7 of Detroit, and we came together and negotiated an 8 agreement with them under the leadership of the 9 NAACP, and they were able to come to an agreement 10 at that particular time. And then after that, we 11 reached another agreement with them. 12 What we have found is that as we've had 13 many concerns, opposed what they were doing, we 14 found that communication, working with them and 15 meeting with them on a regular basis at least twice 16 a year and going through our agreements and going 17 through the various items that we have and working 18 with them to try to improve their investment in the 19 community really was a way that we were able to, I 20 think, achieve some outstanding type of agreements 21 and loans to the City of Detroit. 22 Just some examples of that, in 1995, we 23 reached an agreement with NBD and for $677 million 24 over a three-year period, and by working with them, 193 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 though, and by encouraging and by on a regular 2 basis having a staff that worked with their staff, 3 they were able to achieve 1.5 billion dollars worth 4 of lending in that same three-year period, 5 surpassing the low income mortgages by 144 percent 6 of the goal that we have set as small businesses 7 under $1 million located in the City of Detroit by 8 765. An outstanding achievement what they were 9 able to do by us working with them. 10 Under procurement, when we went with them, 11 they admitted that they did not even know if there 12 was any minorities that were serving their company 13 to any degree and particularly African Americans. 14 And Detroit representatives 75 percent African 15 Americans. We were very concerned about that. 16 The CEO at that time put it as a major 17 objective for him to increase that, and we worked 18 with them, and they created a division called the 19 Minority Procurement Division and appointed a 20 person there that was very supportive in the 21 community. And as a result of that, they have 22 increased that minority procurement and now has 23 become a model that is used throughout our 24 grievance with other financial institutions, and 194 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 that is used throughout the country in setting up a 2 department that does procurement. 3 In employment, we're very pleased that 4 they have one of the highest levels of senior 5 management that there is in the banking community 6 in Detroit and as we understand across the country 7 and they have promoted people from within and 8 brought in others in order to have a diverse type 9 of senior management and unemployment level also. 10 We think that has been very helpful. 11 So what we believe is that this merger is 12 something that is happening throughout the city. 13 It's something that is probably going to happen 14 even more so in the future. 15 And what is important is that we're going 16 to have to -- they are going to have to understand, 17 Banc One as well as First Chicago NBD and those 18 entities, that it is important to work with all the 19 communities that have come out here and expressed 20 some concerns as we were able to do in Detroit by 21 coming together and meeting on a regular basis. We 22 think that they will be able to achieve some of the 23 similar goals that we've been able to do in Detroit 24 with NBD. And we think that those are very 195 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 important goals. 2 Some of the things that we think are going 3 to allow us to make sure that we continue to have 4 representation in Banc One and continue to have 5 some influences there, one, we have met with John 6 McCoy and we have had very enlightening discussion 7 with him about exactly what we want to see happen. 8 There's agreement that we will have one of 9 our members that we select that will be on the 10 advisory board of NBD, their advisory council, that 11 is formerly the board members of NBD before the 12 merger with First Chicago. 13 there's an agreement there will be a real 14 effort on diversity in the senior management of 15 Banc One, and we'll be looking at those numbers on 16 a regular basis whenever we meet with them to make 17 sure there is diversity on all levels of management 18 and that we want to continue to have that type of 19 communication with them. 20 And we feel confident that NBD has agreed 21 and have said -- it has been a good business 22 decision to work with us. It has increased their 23 time and their relationship with the community and 24 they're now recognized as a real leader in the City 196 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 of Detroit. 2 Thank you very much. 3 MS. SMITH: Thank you. 4 MR. ANTHONY: Thank you very much. 5 My name is Wendell Anthony. I'm president 6 of the Detroit Branch of the NAACP and also 7 Co-Chair of the Detroit Alliance For Fair Banking. 8 Pardon me if I leave when I finish because 9 I have a flight to catch. 10 I do want to echo some of the concerns 11 that Mr. Parker said. 12 One of the things I think that is 13 important for us to point out is that several years 14 ago, many persons in our community along with the 15 local news media did an expose on all of the banks 16 in the City of Detroit, and we found that all of 17 them were guilty of noncompliance to access to 18 capital, to discriminating against minorities, to 19 not including us in procurement, to not including 20 us in the full benefits of what banks do derive 21 from their communities. 22 So the alliance was formed. The first 23 agreement that we reached with NBD at that time, 24 the National Bank of Detroit, was for $1 million. 197 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 Today, we have an agreement with them for $3.25 2 billion for the next three years. That came after 3 negotiations and pain and some gain. 4 We believe that it's important for us to 5 engage in the community. We certainly understand 6 where a lot of people are in terms of their own 7 local communities, but I think it was Diane 8 Karmasol that said one must be true to his or her 9 own reality. 10 Our reality is what we're pointing out to 11 you today, and that is that we have reached a point 12 in Detroit particularly that is driven by First 13 Chicago NBD in conjunction with Banc One with this 14 new agreement. 15 The Detroit Alliance For Fair Banking is 16 made up of several organizations, almost a 17 hundred. We have, in fact, enlisted not only their 18 thoughts but also tapped into the sources and the 19 thinking that our community would have this merger 20 presents an opportunity to open the door even 21 wider. 22 Just recently in Detroit, over 400 23 businesspersons, African Americans 99 percent of 24 them, were at a Detroit sit-in in which we talked 198 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 about the debriefing which would be accomplished as 2 a new plan. The new plan accomplishes new homes, 3 commercial development, small business development, 4 hiring of minorities in various areas of the bank. 5 One of the things that we were very 6 concerned about was how this is going to transfer 7 itself, if, in fact, this merger would take place. 8 Would Banc One be driving the other way or would 9 the other way be driving Banc One. 10 We believe that this marriage has some 11 promise to the degree the two cultures can come 12 together and impact each other. 13 We have found that First Chicago NBD has 14 been a good culture and a good experience for us, 15 otherwise, we would not be here talking to you. 16 For so many years, banks have been talking 17 loud and doing nothing. Well, in Detroit, they are 18 now talking loud and they're doing something. The 19 fact that we do have businesses we can point to who 20 have been the recipients of loans from the bank, 21 the fact that we do have African Americans and 22 women and other minorities who have received home 23 mortgage improvements and loans and start up 24 capital is a fact that we can point to. 199 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 The fact that in this recent agreement 2 they have predevelopment moneys which allow 3 businesses who are trying to develop a business 4 plan heretofore might not have the expertise to do 5 that, but they can now back out of their grants or 6 their loans. 7 Money for predevelopment is a major, major 8 factor. We've also set up a program where they 9 will now work with the local community colleges so 10 that students can be trained in the banking 11 community. 12 As you may or may not have heard, Detroit 13 is on the cusp of getting casinos in our 14 community. Usually, though, it's the persons who 15 are from banks, the tellers and the financial 16 people, are the first ones that are snatched to 17 work in those industries. What we believe that's 18 going to occur, then there should be a constant 19 flow going into the banking community. 20 So we structured a program whereby through 21 a feasibility study and work with other banks that 22 we can train students in Wayne County Community 23 College and in Detroit at the Lewis College of 24 Business inside the City of Detroit to prepare them 200 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 for the future in the banking industry. 2 We believe that while this merger may not 3 be perfect, it certainly puts us in a situation of 4 being able to impact and to influence the bank, and 5 we believe that in other communities, if they 6 begin -- and I'm sure they are already -- doing the 7 same types of things that we are doing, and perhaps 8 we can loan some expertise to them in some other 9 areas. We'll be glad to do that. There will be 10 some new pavement that will be open to all of us. 11 We support the merger. It's drawn from 12 our experience which to us has been a good 13 partner. We believe through their impact, Banc One 14 can also become a good partner. 15 Thank you. 16 MS. SMITH: Thank you very much. 17 Mr. Cardona. 18 MR. ANTHONY: Please excuse me. 19 MR. ALVAREZ: Thank you very much. 20 MS. SMITH: Thank you for coming. 21 MR. CARDONA: Good afternoon. My name is Hugo 22 Cardona. I'm the President and Chief Executive 23 officer for SER Jobs Progress National. 24 I'm here to speak on behalf of Banc One 201 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 and its merger with Bank Chicago. 2 SER is the largest in serving minorities, 3 especially Hispanics. We empower people to go from 4 welfare to work. We were founded in 1964; 5 therefore, we have been 34 years serving the 6 communities. 7 We were founded by LAUC, the Latin 8 American United Citizens, and the GI Forum, the two 9 organizations that serve the Hispanics minorities 10 and Hispanic minorities for civil rights. 11 Our mission is very simple. We empower 12 the individual to find the skills that they need to 13 be useful to the communities. We give the 14 education, the training, the housing, whatever they 15 need. 16 Our challenge is very simple. We need to 17 empower the 21st Century work force to have the 18 skills in such a way that at this time that we have 19 a good economy, everybody's being hired, but two 20 years from now, if we have organization, they will 21 be the first ones to go if we don't empower them to 22 have the skills to survive. 23 To do that, we have our national 24 headquarters in Dallas. We have 38 affiliates 202 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 located in 17 states, the District of Columbia and 2 Puerto Rico. We are in 91 locations. We have more 3 than 180 programs. We serve more than 400,000 4 individuals a year, of which we place more than 5 30,000 in meaningful jobs, meaning jobs beyond the 6 minimum wage with full benefits. 7 This means for the economy between $701 8 billion in purchasing power that these individuals 9 that were on welfare now have as a Hispanic 10 community. Our funding exceeds $68 million a 11 year. 12 To do this empowerment, we have different 13 programs. We have programs like One Stop Career 14 Centers where anybody can come and we will take 15 care of them. We will evaluate their needs and we 16 will find a way for them. We have housing in which 17 we assist minorities to buy their first homes. We 18 have distance learning. Through the computer, we 19 are able to give today from your home Associate's 20 Degrees, K-4 to K-16 education, GED, English as a 21 second language, basic skills, whatever you need. 22 We have different programs for women, for 23 youth, for children. And we have peoples with 24 disability, homemakers that are disabled. 203 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 Whatever it is, we take care of our 2 minorities before they are born until they are -- 3 until they die. To do that, we have two sources of 4 funding; the government, who take cares of the 5 present. They give us through competitive grants 6 the ability in these locations to serve the needs 7 of the people, but we must take care of the 8 future. 9 And this is where Corporate America and 10 individuals like you come into place. You are the 11 ones who give us the money to develop the things 12 that we need to be better, all the distance 13 learning and all these programs that we need to 14 serve the minorities. 15 And this is where Banc One comes into 16 play. They have been our partners in our housing 17 program. In the last three years, we have placed 18 more than 270 individuals in homes, people that did 19 not have a credit record, people that did not have 20 the down payment. We were able with the assistance 21 of Banc One to put them in homes. Their 22 contribution to our work will be this year more 23 than $100,000 dollars. 24 And we are negotiating right now a million 204 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 dollar credit line on what we need to replace all 2 the computers in our network, and we will be able 3 to place the old computers in the homes of the 4 minorities. 5 This is an outstanding record for an 6 organization that is working with us into making 7 this positive. 8 So as I said, look at Banc One as a 9 partner that with this measure we increase the 10 support to the community, but we work for the 11 community in making this possible. So we do 12 support this merger. 13 Thank you so much. 14 MS. SMITH: Thank you very much. 15 Ms. Hunt. 16 MR. CARDONA: And I apologize, but I also have 17 to leave. 18 MS. HUNT: Good afternoon. 19 My name is Gladys Hunt, and I am with the 20 Community Collaboration for Economic Development in 21 Champaign, Illinois. 22 And I'm here to represent the Community 23 Collaboration for Economic Development. It's a 24 relatively young organization. It was initially 205 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 convened as an informal community group in June of 2 1997. 3 This group came together to address the 4 needs of the low income and minority community in 5 terms of small business development. It's an 6 informal community group comprised of 7 representatives from the African American business 8 community, from municipal government, nonprofit 9 civic groups like the NAACP and the Urban League of 10 Champaign County, women's business groups and the 11 University of Illinois. 12 In the Spring of 1998, the Community 13 Collaboration for Economic Development was legally 14 incorporated as a nonprofit organization. 15 Our mission is to create an ongoing 16 economic development project to increase the number 17 of businesses within the low income and minority 18 community. 19 The mission is to develop human capital to 20 promote unique ideas through business education, 21 technical assistance and targeted economic 22 development programs. 23 To date, we have graduated one 24 entrepreneurial small business development class 206 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 this past spring. We graduated 14 out of 15 2 persons who started in the class. And in the 3 class, people were given technical assistance and 4 business development information. 5 Our next class will start August 29th, and 6 we have 18 people signed up in that class, and we 7 have 28 people on the waiting list to start a class 8 next spring. 9 In addition, this month, we're going to 10 start a support organization to assist not only our 11 graduates but other small business -- other 12 minority and low income business owners, a minority 13 business council of sorts. 14 The project started, as I mentioned, in 15 the Spring of 1997 with a partnership Illinois 16 grant, which is a new funding program through the 17 University of Illinois to encourage the university 18 to become involved in the local community. 19 We received an initial seed grant through 20 that program and we worked with local city 21 government and banks, including Banc One in our 22 area, to receive matching funds to fund the 23 program. 24 At this point, we're seeking -- well, 207 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 we've made it to the second round of the community 2 development financial institutions, the CDFI, 3 technical assistance grant, and we're in the 4 process of seeking monies from global banks and 5 from municipal governments to start a revolving 6 loan fund so that not only will we give our low 7 income and minority community technical and 8 business assistance, but we will also be able to 9 help them with financial assistance in starting 10 their business. 11 Now, what does all this have to do with 12 Banc One and the proposed merger? In our efforts 13 to put this community collaboration together, Banc 14 One has been there every step of the way from the 15 beginning. They were at the table at the first 16 meeting that took place in the Spring of 1997, and 17 they've continued to provide leadership on the 18 committee as a whole and in various subcommittees, 19 specifically the Alternative Funding Committee, the 20 Future Funding Committee, the Mentoring Committee 21 and the Small Business Development Workshop 22 Committee. 23 They provided leadership in the form of 24 staff and financial resources. Banc One has led 208 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 the way in sponsoring financial -- various 2 financial aspects of the CCED, -- or the CCED -- 3 I'm using the initials -- the Community 4 Collaboration for Economic Development Operations. 5 Wherever we needed to partner with financial 6 institutions in continuing and expanding our 7 operations, they've been at the table to help us. 8 For example, when we decided that we 9 needed this revolving loan fund to help fund our 10 small business development class because they did 11 not meet the criteria for some of the traditional 12 business funding, again Banc One staffs were at the 13 table providing that leadership helping us develop 14 new and innovative strategies to bridge that 15 between -- to bridge that gap in meeting the needs 16 of low and income minority business community. 17 Finally, I must add that in working with 18 Banc One in developing this outstanding 19 entrepreneur program for our community with the 20 CCED, this was not my personally first encounter 21 with them, this their proactive -- in what I 22 consider a proactive and progressive stance in 23 reaching out to the low income and minority 24 community. 209 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 In 1991, as Assistant Executive Director 2 of the Housing Authority of Champaign County, I was 3 appointed to serve on Banc One's Community 4 Reinvestment Advisory Committee to assist the bank 5 in developing strategies and policies to serve the 6 needs of low income and moderate neighborhoods. 7 I served in that capacity until 1995. And 8 during those four years, I saw Banc One work 9 diligently and proactively to meet the needs of the 10 low income community. And we did that in the 11 housing area, and we're do -- oh, it's expired -- 12 we're doing -- I'm sorry -- in the business area. 13 But I just want to say that we at the 14 Community Collaboration for Economic Development 15 wholeheartedly endorse and support the proposed 16 merger between Banc One and First Bank NBD, and we 17 would just -- I would just add that I would -- 18 well, my time has expired. I'll stop. I won't go 19 so fast. 20 MS. SMITH: Mr. Smith. 21 MR. SMITH: Thank you. Thanks for letting me 22 come before you here. 23 My name is Charlie Smith. I'm Director of 24 the housing authority in Wilmington, Delaware, and 210 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 I was a little nervous and reluctant to come speak 2 when I saw such great opposition to this merger, 3 especially since I'm in favor of -- my agency as 4 well as my community is in favor of the merger with 5 Banc One and FCC. And you ask, well, why? 6 At least we have some people -- at least 7 we're all on the same page in terms of going along 8 with this merger. I think it's going to enhance 9 the relationship that I have established with both 10 banks. 11 My first encounter has been with FCC. 12 Well, FCC has been very creative in working with 13 our community, especially in the public housing 14 arena, to address some of the concerns as ways to 15 employment opportunity, business development and as 16 well as home ownership in our community. 17 And I know Roland Ridgeway, who's very 18 active in our community, who's been a leader in our 19 city with FCC to try to encourage collaboration and 20 partnership not only with communities, but he's 21 also in his efforts to try to get them more 22 involved in the neighborhoods with other banks and 23 pulled together banking interest and collaborated 24 in development programs and activities that have 211 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 helped facilitate opportunities of our community in 2 Wilmington. 3 Banc One has been good corporate partner 4 as well as FCC, and that's a good corporate 5 partner. 6 It's not often I've had an opportunity to 7 work with an institution that will come to you and 8 say, look, what can we do to assist you in your 9 efforts in your community? 10 And Banc One took the lead in coming to 11 the Wilmington Housing Authority because the 12 Wilmington Housing Authority has had the 13 distinction of having so many vacant units in its 14 inventory throughout the City of Wilmington, 15 somewhere around 500. And we put up a plan to 16 address those vacant units. 17 And when the newspaper reported our plan, 18 how we proposing to do it, Banc One and FCC were 19 one of the first banks who came in and said what 20 can we do to facilitate and participate in your 21 efforts to address your home ownership as well as 22 your vacant units? One specifically. 23 FCC is right now pulling together several 24 banks in which they're taking the lead on putting 212 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 together a $5 million pool, revolving pool we're 2 referring to it as. 3 One of the reasons this pool is necessary 4 for us is because we cannot collateralize our 5 property, our public housing. We can't use it as 6 collateral. This pool will be used to help 7 collateralize some property so we can get some 8 money from private as well as state to help us 9 facilitate elimination of our vacant units that 10 we're having. 11 So FCC has really taken a lead on getting 12 some banks together to be partners with them to 13 help put together this pool of money so we can use 14 to -- acquire some money for us to do something 15 with these units that we have in this old city. 16 Banc One came and said, look, what can we 17 do, how can we be a partner with you to help 18 dealing with not only housing, but what other 19 areas? 20 So we're talking about community 21 development, about funding some programs as it 22 relates to mortgages. 23 Wilmington has a distinction. We have 24 like 54 banks just in Wilmington alone. In our 213 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 case, we have so many banks falling on each other 2 to get to do things in the community that we have 3 the luxury, we can almost pick and choose who we'd 4 like to work with, but Banc One and FCC has stepped 5 up to the plate and really has demonstrated some 6 guts in trying to work with public housing. 7 I don't know how often they have an 8 opportunity to do that, but they came to us. They 9 brought the thing to us and say, look, you guys sit 10 down and talk and see where we can help you in your 11 community and facilitate programs and activities 12 that would help enhance. 13 And they have done a tremendous job. one 14 of the things I've asked them to do and consider, 15 personally give me some technical assistance. They 16 took two of my staff people recently, about two or 17 three months ago they had a conference for their 18 staff, Banc One staff, on how to put together 19 packages for development of corporations and 20 housing development, that stuff. And they invited 21 two of our staff to go to Texas to participate in 22 that program. 23 As a result, we're doing a private 24 development on our own where we take one of our 214 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 largest high-rises and turn it into a private 2 market venture and using tax credits and all that 3 and provided us technical assistance on pulling 4 this whole process together. 5 So we've had good experience with Banc One 6 and FCC. And I'm kind of surprised that we have 7 such opposition. The relationship we've had has 8 been a positive one. This merger I think is going 9 to enhance the relationship. I've had work with 10 both FCC and Banc One. So I think that merger is 11 going to enhance not only the opportunity for us to 12 do more work in our community and our neighborhood 13 but also is going to help facilitate some greater 14 opportunities for economic development in home 15 ownership as well as community development in our 16 community and neighbors in our community in 17 Wilmington. 18 MS. SMITH: Thank you very much. We'll hear 19 now from Mr. Reid. 20 MR. REID: Thanks very much. I appreciate the 21 opportunity to be here. 22 I'm Jim Reid, President and founder of the 23 Southern Dallas Development Corporation. We're a 24 nonprofit community development financial 215 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 institution that concentrates on business lending, 2 and I'm glad to have this opportunity. I'm glad to 3 be where it's a little cooler than Texas. 4 I'd like to provide some background on our 5 organization, talk about our experience with Banc 6 One and draw some conclusions with some of the 7 issues before this group. 8 Our organization, its mission is to assist 9 businesses, create jobs and promote investment in 10 Southern Dallas. Southern Dallas is -- about half 11 the City of Dallas, 45 percent of the population, 12 75 percent of the population, is a minority 13 population, African American and Hispanic, but it 14 only has 13 percent of the commercial tax base, and 15 the median income is about 60 percent of the 16 northern sector, so Dallas is really bisected in 17 terms of our economy. 18 We were created to help create jobs and 19 started out with one loan fund, and now we manage 20 five different loan funds including an SBA 21 microloan program, CDFI-funded fund and indirectly 22 a bank CDC and an SBA community development 23 corporation. 24 With those funds, we've been able to lend 216 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 22 million directly, leverage about 27 million in 2 our community, 2,500 jobs where they're needed 3 most, including a thousand jobs in the last two 4 years for a small community-based organization. 5 We did that with the support of partners 6 in the community like Banc One. And Banc One, 7 although they're not the largest bank in our 8 market, they are the largest investor in our 9 multi-bank CDC, and that's especially important 10 because with a community loan corporation bank, you 11 can do things banks cannot. 12 We provide a lot of money in terms of 13 subordinated debt, and that's very important to 14 minority businesses. That's about 70 percent of 15 our portfolio is minority businesspersons. 16 They have participated with us in 29 17 deals, joint and financing where they brought money 18 to the table totaling about 34 million dollars. 19 They provided match to about $100,000 for the 20 Community Development Financial Institutions Funds 21 and pledged 200,000 in match. 22 The underwriter newspaper that we put out 23 every year going through all of the people who 24 receive the Dallas Morning News telling about the 217 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 positive features of our community, one thing that 2 we found, trying to promote investment is the 3 negative image of what can happen to low and 4 moderate income communities, so we publish our own 5 newspaper, and we know it's the truth because we 6 write it. 7 They have helped us in terms of providing 8 loan bankers and have helped us in terms of a 9 volunteer member of our board, in fact, our current 10 Board Chairman is a member of Banc One. 11 Now, three issues. Would they be 12 responsive in a new community? They came into 13 Texas and bought a bank there. And they were 14 responsive in our community. Will they lend to the 15 minority community? Our experience in terms of 16 managing a portfolio that's 70 percent has gone to 17 minority borrowers, we believe the answer is yes. 18 And then finally, in terms of an issue 19 before people doing small business lending, right 20 now small business lending has changed dramatically 21 in the last two years, and it's because credit's 22 growing. You know credit's growing if offering 23 lower transaction charges and quicker turnaround. 24 It also means if you don't make the profile, you 218 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 don't get money. That's where alternative lenders 2 like us have come in. Banc One has worked with us 3 in two ways. There are people out there that are 4 on the bubble and are not getting funded because of 5 credit. 6 We get referrals from Banc One and we 7 provide an award to one of their staff persons 8 providing the most referrals last year. 9 The second thing I think is more 10 important; they have created a community 11 development lending arm within the bank that has 12 special regulations, special allowances in terms of 13 the time that they can spend with clients and their 14 loan losses they are allowed and so forth. 15 Basically, in this credit storing system, 16 if you're a special kind of a deal that needs more 17 help, you get put to the bottom of the pile. This 18 means that organizationally, they've helped address 19 this just as we have addressed it by delivering 20 alternative products. 21 So we're very positive about this merger 22 because of our experience. People today have had 23 different experience. Our experiences have been 24 positive, and we urge you to support the merger. 219 McCORKLE COURT REPORTERS, INC. CHICAGO, ILLINOIS - (312) 263-0052 1 MS. SMITH: Thank you very much. 2 Any questions? 3 Then we thank you very much for coming 4 this afternoon. Be sure and give your written 5 statements, if you haven't already, to the people 6 at the registration desk so they can be fully 7 entered into the record. 8 And we're going on to Panel 12. 9 We're going to start with Mr. Bromley.
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