Public Meeting Transcripts
Public Meeting Regarding Fleet Financial Group, Inc., and BankBoston Corporation
Wednesday, July 7, 1999
Transcript of Panel Nineteen
18 MR. CARVALHO: Good evening. My name is 19 Frank Carvalho, and I'm the Executive Director of 20 the Coalition for a Better Acre, a community 21 development corporation in Lowell, Mass. 22 I'm here tonight to testify as executive 23 director of a community development corporation that 24 deals with low- to moderate-income residents in the 25 oldest and poorest neighborhood of Lowell, and I'm 0488 1 very concerned about this proposed merger. 2 First, it's hard for me to understand why 3 this new proposed entity refuses to deal with my 4 trade organization, the Massachusetts Association of 5 Community Development Corporation, who we chose to 6 represent our community. Second, why can't they make 7 specific commitments in response to our proposals? 8 I urge you to support us in the following 9 requests: that Fleet and BankBoston develop a 10 detailed and publically verifiable community 11 reinvestment plan negotiated with community 12 organizations and elected officials with specific 13 commitments ensuring the net benefit to low- and 14 moderate-income and minority communities. 15 Two, to extend the public comment period 16 until such brand is developed and released to the 17 public, and to issue no approval unless and until 18 the aforementioned conditions are fully met. 19 This is our hope, that the mergers of the 20 largest banks in New England should benefit low- and 21 moderate-income and minority communities as well as 22 shareholders. One plus one should equal more than 23 two. 24 This is very important because each bank 25 has been a significant part of the solutions for our 0489 1 community through their grant program. I went to 2 BankBoston to help CBA to put 16 low- and 3 moderate-income residents of Lowell into their first 4 houses as homeowners. We are very proud of them. 5 And a grant from Fleet Bank has allowed CBA to 6 develop 50 resident leaders who are researching and 7 addressing community obstacles such as child care, 8 transportation, lack of benefits and other issues 9 relating to the employment issues that affect low- 10 and moderate-income residents of our city to get 11 good and liveable wage jobs. 12 Fleet Bank and BankBoston should ensure 13 that one plus one will be greater than two in 14 charitable contributions for community development. 15 They should include what we propose, which is a $5 16 million statewide charitable budget for the Year 17 2000 and increasing beyond that. It is currently 18 estimated that the merged banks' Chapter 102 19 obligation to the Mass. Housing Partnership fund, 20 MHP, could range hundreds of millions of dollars in 21 net financing. 22 The merged bank could help to meet the 23 critical equity needs in the affordable housing 24 development market by converting all or a majority 25 of the debt to a grant that can be administered by 0490 1 the MHP fund. This would greatly contribute to the 2 development of affordable housing. BankBoston's 3 grant conversion at the time of the last merger 4 yielded approximately one grant dollar for every $9 5 of debt. As a result, MHP was able to capitalize a 6 firm plus program with over 367 affordable rental 7 units financed through firm plus. It also allowed 8 MHP to capitalize the fund resulting in additional 9 241 units. 10 The merged bank should result in Fleet and 11 BankBoston's participation in the Basic Banking for 12 Massachusetts program that offers low-cost checking 13 and savings accounts targeted to low-income 14 consumers who have been discouraged from using the 15 banking system by high transaction fees. The new 16 bank should adopt a program that allows ten checks 17 and ATM transactions per month with a $2.50 fee and 18 75 cents per additional check. 19 In addition, the bank should create an 20 aggressive campaign to market its products in low- 21 to moderate-income and minority communities. 22 Finally, Fleet and BankBoston can best 23 assure that these goals are met by negotiating and 24 signing the Community Investment Agreement with 25 MACDC covering the above-discussed items and others 0491 1 in the proposal previously forwarded to them. The 2 agreement should be for at least five years. It 3 should include a process and commitment to 4 renegotiate an extension of this agreement for an 5 ongoing relationship. 6 It should also include provisions for 7 regular communication among the parties, plus 8 specific mechanisms for reporting and verifying that 9 the goals of the agreements are being met. By 10 agreeing to enter this agreement, the new entity 11 would assure that my community needs are being met, 12 and sending a loud and clear message that one plus 13 one does equal more than two. Thank you for 14 listening. 15 HEARING OFFICER SMITH: Thank you very 16 much. 17 Mr. Colton. 18 MR. COLTON: Thank you. My name is Roger 19 Colton. I am an attorney and a member of the 20 Belmont, Massachusetts, Fair Housing Committee. I 21 speak tonight on behalf of the Belmont Fair Housing 22 Committee, an arm of the local government of the 23 Town of Belmont. 24 One question presented to federal 25 regulators by the proposed merger of Fleet Financial 0492 1 Group and the BankBoston Corporation is whether the 2 merged bank will adequately address the credit needs 3 of the community. In assessing whether this will 4 occur, there is a need to differentiate between the 5 urban and the suburban communities. There is a 6 significant focus of attention today on the urban 7 community. Unfortunately, there is much less 8 attention focused on the suburbs. One of the next 9 major steps that must occur in fair housing lending 10 is to facilitate the diversification of suburban 11 communities. 12 My discussion tonight focuses on one slice 13 of Boston suburbia, beginning with Belmont and 14 radiating north and west eventually to capture the 15 communities of Belmont, Waltham, Lexington, Woburn 16 Winchester, Arlington, Burlington, Bedford, Sudbury 17 and Concord. Information on Lincoln was sought but 18 was not available. 19 Unfortunately, it is not only difficult but 20 it is impossible to discuss the data in five 21 minutes. Accordingly, I will present our 22 conclusions to you this evening and commend our 23 written presentation to you for perusal of the 24 supporting data. 25 The first major credit need in the suburban 0493 1 community relevant to tonight involves the promotion 2 of socioeconomic diversity. One lesson found in the 3 available data from the ten study communities is 4 that the affordability of units is not the only 5 barrier to home ownership in the ten communities 6 studied. Home ownership is unavailable even when 7 affordable home ownership opportunities exist. 8 Information was obtained for each of the 9 study communities on the number of units that are 10 affordable at different levels of median income. 11 This information shows that merely because a unit is 12 affordable at a designated income level does not 13 mean that it is actually occupied by a family or 14 household with that income. 15 It is often asserted that Boston's suburban 16 community lacks a greater socioeconomic diversity 17 because of the lack of affordable housing. The data 18 confirms that this is frequently the cause. The 19 data further show, however, that something more 20 stands as a barrier to socioeconomic 21 diversification. 22 The data present a compelling case that 23 when and where affordable home ownership units 24 exist, they are not being purchased by households at 25 lower incomes. To meet the needs of diversifying 0494 1 the suburbs, specific proactive steps are necessary. 2 From a fair housing lending perspective, this need 3 is more than simply to avoid discrimination. 4 The second major credit need in the 5 suburban community, as relevant for purposes 6 tonight, involves the promotion of racial and ethnic 7 diversification. The data from the ten study 8 communities used for our report show a lack of 9 diversification even when controlling for income as 10 measured by percent of median income. 11 Merely because units may be affordable to 12 households of color does not mean that households of 13 color are becoming homeowners in these suburban 14 communities. The lack of racial and ethnic 15 diversity in the ten study communities cannot be 16 attributed exclusively to the lack of affordable 17 housing availability. 18 By definition the price of housing was not 19 the limiting factor in our analysis. The data was 20 limited to housing determined to be affordable at 80 21 percent of median income or more with which to 22 begin. The data was also limited to 23 African-American and Hispanic households who have 24 income of at least that amount. 25 Something more than the mere affordability 0495 1 of home ownership is creating barriers to suburban 2 home ownership for households of color. 3 So why do I present all of this tonight to 4 you folks? Identifying and seeking remedies for 5 barriers to diversity and home ownership is one 6 essential element in fair housing lending. Fair 7 housing lending involves more than merely avoiding 8 discrimination. Fair housing lending has as its 9 ultimate goals the elimination of the effects of any 10 fair housing impediments outside the lender's 11 control and the elimination of any identified 12 impediments within the control of the lender. 13 This proposed merger should not only not 14 impede but should affirmatively promote this 15 construct of fair housing lending. 16 Based on the two credit needs of the 17 suburban communities which I previously identified, 18 it would be appropriate for a Fleet-Boston to commit 19 to working with the Greater Boston fair housing 20 community to develop a plan of action to promote the 21 diversification of the suburbs. 22 This plan should include a stated goal, 23 supported by both short-term and long-term 24 objectives, a written work plan in furtherance of 25 accomplishing those objectives, an evaluation 0496 1 mechanism to determine performance relative to the 2 stated objectives, and a review mechanism charged 3 with utilizing evaluation to formulate 4 recommendations on modifications as needed to the 5 plan of action should the objectives not be 6 achieved. 7 Thank you for providing an opportunity for 8 a representative of local government to speak with 9 you tonight. 10 HEARING OFFICER SMITH: Thank you. 11 And we'll move to Mr. Cusick. 12 MR. CUSICK: My name is Pat Cusick. I'm 13 the Executive Director of the South End Neighborhood 14 Action Program, SNAP, in Boston, and for the record, 15 I reside at 521 Shawmut Avenue in the South End of 16 Boston. 17 I'm departing from my written testimony. 18 It has been noted that something unusual has 19 happened here today. Of the 72 organizations 20 testifying in favor of the acquisition by Fleet in 21 the charitable lending category -- of the 75 that 22 testified here today, 72 are nonprofits. 23 Now, I'm not against nonprofits. I'm the 24 executive director of a nonprofit. But isn't that 25 strange? Where are the small businesses? I would 0497 1 hope that the Fed would be concerned. I mean, 2 really, this is astounding. 3 For most of my professional career, I've 4 been concerned with affordable housing, affordable 5 rental housing. I was the organizer that seized the 6 Harvard commencement in 1970 and held it hostage 7 over the issue of affordable housing. 8 In the 1980s I was the organizer of a 9 coalition in my neighborhood that enabled 360 10 families to live in affordable housing that cost $60 11 million. I myself am the owner/developer of a 12 nonprofit that has won national honors in the South 13 End, 84 units of limited equity co-op housing. 14 But I've shifted my principal concern after 15 all this time from being concerned about rental 16 housing to that of home ownership. Maybe it's 17 because in my neighborhood, in Lower Roxbury, less 18 than 5 percent of the units are home ownership. 19 Now, I'm going to repeat that, because that's the 20 least amount in the city of Boston, less than 5 21 percent are home ownership. And that is in a city 22 which, as you know, has the least amount of home 23 ownership in the United States. 24 Now, this is a terrifying statistic when 25 you think about it, and this is why that 0498 1 neighborhood is so vulnerable to every takeover of 2 any sort. 3 Home ownership is more than shelter. It is 4 more than a psychological support for families. 5 Home ownership is not only part of the American 6 dream, but on a scale that doesn't have anything to 7 do with individual housing, home ownership sinks 8 roots into the communities. And in the low income 9 communities, there are very few roots. And when you 10 have rootless communities, the entire community and 11 then the entire city is at risk. We desperately 12 need more home ownership. 13 Now, at this portion of my testimony, I was 14 going to reiterate Professor Campen's excellent 15 report, but there is no need to do that; you have 16 the report, you have heard from him. 17 I just want to make a plea that we really 18 need home ownership. What's happening in Boston is 19 the tale of two cities: people of affluence and 20 people that are poor. The working class is very 21 fragile in this city. They can't find housing, and 22 we need affordable home ownership for working class 23 families and for the lower middle class. So that is 24 my focus and my plea. 25 I will say that we had hoped that one plus 0499 1 one would equal more than two, but I'm sure you have 2 seen Brian Mooney's column in the Boston newspaper 3 of record, the Globe, on Saturday which iterates the 4 number of banks that have been subsumed by other 5 banks and are now Fleet. There are 450 former 6 independent banks that are now Fleet. So maybe 7 instead of saying one plus one should equal more 8 than two, we should say 451 plus one should equal 9 more than two. 10 I think we need several things. We need 11 mortgage lending that allows families to stay in 12 their own neighborhoods and to invest in their 13 neighborhood. We need home equity lending programs 14 which help ensure that the family homestead can be 15 passed on to the next generation. We need small 16 business lending that ensures that neighborhoods can 17 sustain their local infrastructure, while local 18 entrepreneurs are encouraged to continue investing 19 their own blood, sweat and tears in their 20 communities. 21 And we also need a banking presence in 22 which bank employees look like the people in our 23 neighborhoods and are hired from our neighborhoods 24 with a helping hand in the area of training and 25 education. 0500 1 We are very concerned about this proposed 2 merger, and we very much insist that there be an 3 agreement which is verifiable and accountable, and I 4 think it's the responsibility of the Federal Reserve 5 Bank -- who else can do it -- to ensure that this is 6 a written agreement on the offers that Fleet-Boston 7 is making, and obviously it has to be signed. I 8 mean, no agreement is an agreement unless it is 9 signed. If I go into Fleet and get a loan and I 10 have to pay back $150 a month or something, 11 obviously I can't get away with a local agreement, 12 with an oral agreement. 13 So Fleet-Boston should sign a signed 14 agreement overseen by the Feds, because we must turn 15 to you for any of the benefits that we'll receive. 16 Thank you. 17 HEARING OFFICER SMITH: Thank you very 18 much. 19 Mr. Harris. 20 MR. HARRIS: My name is David Harris, and 21 I'm the Executive Director of the Fair Housing 22 Center of Greater Boston, an organization promoting 23 equal housing opportunities for all people 24 throughout the Greater Boston metropolitan region. 25 I have spent much of the last two days 0501 1 trying to edit my testimony down to five minutes. 2 This morning as I sat gasping for air after reducing 3 my comments to seven minutes, I realized that every 4 second I saved cost substance. I was reminded of a 5 joke I used to tell students to loosen them up 6 before administering exams. A proctor notices a 7 student has sat statue still for two and a half 8 hours of a three-hour exam on the tradition of 9 rhetoric. When she warned the student that time was 10 wasting, the student protested that he had studied 11 for two weeks and reduced the article into a single 12 word. "And now I've forgotten the word," cried this 13 beleaguered fellow. "That's bull," intoned the 14 proctor. "That's the word," exclaimed the student. 15 This is how it feels to peal away substance 16 and come before you with abbreviated arguments. 17 After reading the articles in today's Globe, I 18 realized I should save my breath. The real battle 19 took place in the editorial room to which I do not 20 have access and which bank representatives surely 21 had more than five minutes to make their case. So 22 I've submitted a copy of my expanded version 23 writings, and I offer here only a few highlights and 24 comments on process. 25 I must say, as I looked at you all, I 0502 1 thought of another comment from a professor of mine 2 who used to say that he attended a union meeting at 3 which a speaker stood up and said, "Ladies and 4 gentlemen, the last speaker spoke to you in vague 5 generalities. I, however, am going to speak to you 6 at random." You must feel a bit of that coming on, 7 and I hope that I'm a little bit more focused than 8 that. 9 I should begin by saying that many of the 10 comments that you heard today touch on fair housing 11 issues, from affordable housing to mortgage lending, 12 from diversity of the work force to the location of 13 branches. The Fair Housing Center agrees with those 14 who have come before you to ask the Federal Reserve 15 Bank to closely scrutinize the banks' stated 16 commitment to community. 17 The Fair Housing Center is among a hundred 18 plus community groups with whom the banks have 19 proudly boasted meeting. We had to request that 20 meeting, and while the tone was cordial and 21 discussion open, we were distressed by the 22 suggestion that we return at the end of the year to 23 explore fair housing issues after the merger is 24 complete and the new entity is consolidated. 25 Given the history of housing discrimination 0503 1 in this country and Fleet's chapter in that history, 2 a firm public and detailed commitment to fair 3 housing must precede and not following a merger. 4 The practice of effective fair housing is 5 or certainly should be a basic element of good 6 banking, basic but not simple. The practice 7 requires lasting institutional commitment driven by 8 an honest and ongoing self criticism. Effective 9 practice does not occur in isolation but is by 10 nature cooperative and open. It depends upon 11 developing and maintaining internal mechanisms, as 12 well as partnerships with external organizations 13 across institutional lines. 14 Of course creating these partnerships 15 requires a basic element sorely missing from the 16 proposal that you are considering: Trust. Fair 17 housing involves more than the widely acknowledged 18 commitment to LMI consumers and neighborhoods, and 19 the scope of the Fair Housing Center's mission 20 extends throughout the 150 plus cities and towns 21 which comprise our service area. 22 The Federal Reserve Bank must also look 23 beyond the CRA horizon and condition any approval on 24 specific commitments to fair housing in the broader 25 community as well. A step toward creating that 0504 1 trust and ensuring that any approved bank practices 2 effective fair lending, the Federal Reserve Bank 3 should require two specific commitments. 4 The first is a comprehensive review of the 5 two banks' policies, practices and procedures to 6 identify possible impediments to fair housing. The 7 review should be conducted by internal and external 8 analysts and cover impediments within the lender's 9 control as well as more general impediments in the 10 market. The results of this review should be made 11 public. 12 Second, the Federal Reserve Bank should 13 require the new entity to translate that review by 14 specified date within the first year of operation 15 into a detailed plan of action to increase lending 16 to persons of color and other protected classes 17 throughout the region, rather than merely within LMI 18 census tracts. 19 This plan will include quantifiable, 20 verifiable, short-term and long-term objectives -- 21 well, I'm sorry. Roger and I have the same proposal 22 here, so I won't -- in deference to the one minute I 23 won't go on, and it is in my comments. 24 Those of us who come here today have done 25 so in good faith. Our efforts may be characterized 0505 1 variably as begging, extortion or mau-mauing, 2 depending upon the sympathy or the temerity of the 3 critic. But by refusing to enter into enforceable 4 commitments prior to approval, it is the banks who 5 come to you with their hands out. They come, one of 6 them burdened by a history of questionable practices 7 and commitment to fair lending, asking for a free 8 ride. 9 We're not talking about the $14.6 billion, 10 but about formal commitments to certain practices. 11 They refuse to make such commitments and indulge 12 today's spectacle with the arrogant self assurance 13 that you will punch their ticket. 14 The Fair Housing Center believes increased 15 size and power must be accompanied by increased 16 responsibility and accountability. We call upon the 17 Federal Reserve Bank to consider the type of 18 corporate citizen it may be creating by endorsing 19 the proposed merger. Such an entity must accept the 20 leadership role in the area of fair housing and fair 21 lending. It must be expected to do more than its 22 former constituent parts and more than its smaller 23 competitors. It must set the pace for others with 24 fewer resources and less influence in affirmatively 25 furthering fair housing. 0506 1 There's an old saying in the Civil Rights 2 movement that freedom is not free. It is a lesson 3 with which we conduct ourselves, knowing that stands 4 we take may be ridiculed and eventually dismissed by 5 those preoccupied by what they consider the bottom 6 line. 7 But these banks and any new bank must 8 realize that there is a cost to discrimination, not 9 only diminished lives of victims and the community 10 as a whole, but to those who discriminate as well; 11 in other words, a cost to the banks themselves. 12 The Fair Housing Center will be watching 13 and where indicated investigating. But we also 14 stand ready to participate as full partners in the 15 quest to eliminate the practice and effect of 16 discrimination in the housing market. Thank you. 17 HEARING OFFICER SMITH: Thank you very 18 much. 19 Reverend Barnwell. 20 REVEREND BARNWELL: I'm William Barnwell, 21 representing the Greater Boston Interfaith 22 Organization, also a resident, like Pat Cusick, of 23 the South End and Boston. 24 Greater Boston Interfaith Organization, 25 GBIO, is a large and active social reform 0507 1 organization consisting of about 75 faith 2 communities, ten community development corporations, 3 and five other community groups across race, class, 4 denomination, and geographic lines. Over 4,000 5 people attended our founding assembly last November, 6 the first of its kind in many, many years in Boston. 7 I'm here today to represent that 8 organization, which has made affordable housing, 9 especially for low-income people, its top priority. 10 After many small group meetings, my church, Trinity 11 Episcopal Church in Copley Square in Boston, decided 12 to make affordable housing our top outreach concern 13 as well. 14 We at GBIO and at Trinity Church believe 15 that if we are not able to make housing available to 16 all of our citizens, we will rather quickly become a 17 one-class city, forcing most of our church members 18 and other low- to moderate-income people into the 19 distant suburbs. Not only would that make life 20 extremely difficult for them, for those persons, 21 destroying their present communities, it would also 22 have the effect of greatly diminishing the diversity 23 of the city that we cherish so much. 24 Specifically, GBIO urges that you approve 25 the merger only if these six conditions are met: 0508 1 One, as a lot of others have said, that you require 2 a detailed written and signed reinvestment 3 agreement. The idea that such an agreement not be 4 written out in detail and signed is unthinkable to 5 us and we believe should be unthinkable to banks 6 that rely entirely on signed agreements with their 7 customers. 8 Two, that the merger result in at least the 9 same amount of benefits to low income areas that 10 both banks have offered before the merger. 11 Three, that Fleet Bank convert its 12 obligation for a loan pool to the Massachusetts 13 Housing Partnership into an affordable housing 14 grant, that is, equity conversion. Here Fleet would 15 be following the model of the Bank of Boston when 16 they merged with BayBank. By our calculations, $30 17 to $60 million would be available for affordable 18 housing grants. This, we believe, would help many 19 more low- to moderate-income families buy their 20 homes or rent than a small reduction in interest 21 payments would allow. 22 Four, that Fleet Bank and BankBoston meet 23 their commitments to the soft second mortgage 24 programs that they made to the community on May 12th 25 at Roxbury Community College. 0509 1 Five, that the new bank extend the soft 2 second mortgages to other parts of the Commonwealth. 3 Six, that low- to moderate-income 4 neighborhoods continue to have nearby branches of 5 the new bank and that none be closed or sold unless 6 two of the old bank branches are in the same 7 immediate neighborhood. Thank you very much. 8 HEARING OFFICER SMITH: Mr. Bolling. 9 MR. BOLLING: My name is Bruce Bolling. I 10 am the Executive Director of the Massachusetts 11 Alliance for Small Contractors. I am a lifelong 12 resident of the Boston and Roxbury community. I 13 served on the City Council and was President of the 14 City Council. I served on the body for 12 years and 15 have been involved in business development, economic 16 development, particularly for small minority and 17 women business enterprises for quite some time. 18 The Massachusetts Alliance for Small 19 Contractors is a nonprofit corporation that provides 20 business development, capacity building services to 21 small minority and women-owned business enterprises. 22 Mass Alliance helps M/WBEs to acquire the financial 23 resources, the technical capabilities, and 24 management skills needed to successfully compete for 25 projects in the construction industry, including 0510 1 bonding approval, creditworthiness, management and 2 accounting systems, technical expertise, estimating 3 capacity, project experience. 4 We address these needs in businesses 5 through two programs: Our Business Development 6 Support Services Program, our Educational and 7 Training program. 8 The Business Development Support Services 9 Program provides technical assistance and support to 10 M/WBEs through one-on-one management and technical 11 consulting services. We also assist M/WBEs with the 12 financing, tax and insurance issues many contractors 13 face while managing the growth of their companies. 14 These services are provided by construction 15 contracting industry experts, including engineers, 16 estimators, project managers, lawyers and 17 accountants. 18 The various services that we provide, thus 19 far over 350 companies have benefited directly from 20 one or more of MassAlliance's wide range of 21 technical assistance and capacity-building services. 22 Our Education and Training component has 23 served many people in construction management areas. 24 We have provided educational training services to 25 1,753 participants representing 490 companies. 0511 1 MassAlliance engaged in a financial 2 analysis of the clients that we provide services to. 3 That financial analysis was based on our ability to 4 provide programs and tailor programs specifically to 5 meet the needs of minority and women construction 6 contractors. The objective of that profile was to 7 profile the financial position of companies actively 8 receiving services from MassAlliance to determine 9 trends, common characteristics, strong and weak 10 points. The findings will allow us to maximize the 11 delivery of various programs offered to -- and to 12 assist in the design of new programs. 13 One of the major findings of that study, 14 the main financial obstacle that small contractors 15 are experiencing is undercapitalization, resulting 16 in high leverage ratios and lack of liquidity. 17 The more than 50 percent of the 18 participants in our study in fact are rated worse 19 than the industry. And to understand some of the 20 reasons causing this situation, we should start with 21 the high percentage of companies having very low 22 days of cash. 23 What we have been able to determine is 24 that, when you do a comparison of accounts 25 receivable balances compared to sales and accounts 0512 1 payable balances as compared to cost of goods sold, 2 the hidden factor in the accounts receivable numbers 3 is that the retainage is 5 percent. 5 percent of 4 the contract is withheld until the end of the 5 contract. Many contractors start early, which means 6 that they in fact can't get the retainage until a 7 year or two years after the project has been 8 completed. 9 The adverse impact of that is significant 10 to this constituency. What is needed is equity 11 financing, access to capital in ways that 12 traditional financing programs don't commit to. 13 Most of these companies have very low leverages. 14 It's a mature industry. The profit margins usually 15 range from 2 to 5 percent, and it is very difficult 16 for these companies to access capital. 17 My concern with this merger is that what I 18 would like to see for this constituency, and for 19 that matter small businesses, is the ability to 20 access capital based on the real growth needs that 21 these companies have. At present, financial 22 institutions, major financial institutions simply 23 are not doing it. 24 This is a time where the economic expansion 25 should lend itself to innovative, creative 0513 1 approaches to accessing capital. It is not 2 happening for this constituency. Just in 3 Massachusetts, $3 billion a year in construction 4 publicly financed for the next five years, for the 5 next five years. These small businesses are having 6 a difficult time trying to take advantage of those 7 construction opportunities. 8 This merger, if it doesn't address this 9 constituency and other small business 10 constituencies, they will be marginalized forever, 11 and that has been the problem to date. 12 This is an area where major financial 13 institutions have shied away from, and it is 14 something that needs to be done if we're going to 15 bridge this gap to ensure that small businesses in 16 fact get the kind of capital they need in order to 17 stabilize and grow their businesses like anyone 18 else. 19 HEARING OFFICER SMITH: Questions? (No 20 response) 21 We are going to have a one-person panel so 22 that Mr. Porter can catch his flight at 10 o'clock.
Last update: December 3, 2010