Public Meeting Regarding First Chicago and Banc One
Thursday, August 13, 1998
Transcript of Panel Fourteen
16 MR. BELLAMY: Thank you.
17 My name is Paul Bellamy, and I'm with the
18 Coalition for Reinvestment in Lorain County.
19 Lorain County is due west of Cuyahoga County, which
20 is Cleveland, Ohio.
21 I've been asked to read on behalf of some
22 coalition members short portions of testimony which
23 they wanted to enter into the record. I will
24 confine these to two rather short versions and then
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1 get on to my own summarized version of the facts
2 and figures that we feel compel us to come out
3 against the merger with Banc One.
4 The first statement I want to read is from
5 the Board of Commissioners for Lorain County, and
6 in summary, it goes like this.
7 The Board of Lorain County Commissioners
8 supports the Coalition for Reinvestment in Lorain
9 County's efforts to ensure that the results of the
10 above-referenced bank merger are advantageous to
11 Lorain County residents, organizations and
12 political subdivisions. The Board further
13 acknowledges the right and obligation of banks to
14 make sound financial business decisions.
15 However, the Board of Commissioners does
16 not feel that Banc One is committed to serving the
17 low and moderate income communities unless it is to
18 lend money on credit cards or on real estate at
19 higher interest rates to borrowers with credit
20 problems.
21 While this may serve stockholders, as a
22 bank, they are chartered to serve the communities
23 where they do business.
24 It appears that Banc One has been cutting
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1 back on their commitments to the service of our
2 county while refusing to agree to specific goals to
3 improve their performance under CRA.
4 Please encourage Banc One to address those
5 issues prior to approving any merger.
6 And that is, of course, addressed to the
7 Federal Reserve board.
8 I'd also like to read a short portion of a
9 statement from Rebecca Siegal, who is representing
10 or had hoped to represent the Catholic Action
11 Commission of Lorain County. It's a social action
12 office for the Diocese of Cleveland in the state of
13 Ohio.
14 We have some major concerns regarding the
15 increase in mega mergers of our banking
16 institutions and the effects these mergers have on
17 our local communities.
18 When these mega mergers occur, these are
19 local communities urban and rural alike and
20 particularly the areas that are most populated by
21 minorities and low and moderate income families who
22 suffer the most. Branches close, banking services
23 decrease, service fees increase, jobs are lost.
24 It is the stockholders of the banks who
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1 most often have no vested interest in our local
2 communities that make the decisions and the
3 profits, yet in the case of Banc One, depositors,
4 not stockholders, make up 70 percent of the
5 assets. Stockholders make up only about 15 percent
6 on average. It is the stockholders and senior
7 management who walk away with gilded pockets while
8 the depositors receive little or no return on their
9 money.
10 We are scraping the bottom of the pyramid
11 with no return and placing it on the top, and if
12 this trend is allowed to continue, the pyramid will
13 be inverted and most likely tumble because there
14 will no longer be support from the solid bottom.
15 The principal difficulty that the Lorain
16 County Coalition has with Banc One's record is not
17 with actual dollar amounts that have gone into low
18 and moderate income neighborhoods.
19 In fact, I don't know if this is true in
20 other areas, but certainly in Lorain County,
21 there's been a great deal of money proportionately
22 put into the low and moderate income
23 neighborhoods.
24 The difficulty we have is what kind of
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1 money it is and does it, in fact, serve the needs
2 of Lorain County?
3 Lorain County is a Midwestern urban
4 center. Single-family homes are the norm. Home
5 ownership is the way in which a community
6 development strategy would work in these
7 neighborhoods.
8 Now, let's break out all of the money that
9 Banc One claims to be using to meet its CRA
10 commitments.
11 One is the purchase mortgage product,
12 which we herald and we want to encourage them to do
13 more of. Unfortunately, they don't seem committed
14 staying in that market and they don't do
15 proportionately very much of that lending.
16 Where we do see a heavy emphasis on their
17 real estate lending is in refinancing. Refinancing
18 may serve the interest of the particular homeowner,
19 but it does absolutely nothing to increase the
20 value of the homes or to raise the wealth within
21 the neighborhood. In fact, it only inserts a lot
22 more debt on what you might call the neighborhood
23 balance sheet.
24 The positive side of Banc One has to be
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1 mentioned, and that is that they have a strong home
2 improvement product, and in these older 70 to
3 50-year-old houses, that's a very important tool,
4 but it must be recognized that this is a half
5 measure at best when there is a refusal to do the
6 hard work included in a meaningful community
7 redevelopment purchase 30-year mortgage product
8 that requires meeting cost value gaps and doing the
9 difficult work of underwriting loans to first time
10 home buyers who are most often attracted to these
11 neighborhoods.
12 The other problem with the home
13 improvement product is most of it is sold through
14 their branch network. In Lorain County in the last
15 three years, Banc One has gone from 19 to 4
16 branches.
17 In closing, I just want to mention one
18 last development which we find very difficult, and
19 that is the subprime lending. It has increased
20 from three percent in the low to moderate
21 neighborhoods in '93 up to 15 percent of the total
22 lending going on in the low to moderate
23 neighborhoods now.
24 Thank you.
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1 MS. SMITH: Ms. Jones.
2 MS. JONES: Good afternoon. My name is Rebecca
3 Jones.
4 I guess I need a microphone.
5 My name is Rebecca Jones. I'm a resident
6 of Wellington, Ohio, which is the southern part of
7 Lorain County and is a rural area.
8 My remarks at first were intended to be
9 addressed to the Wellington area, however, I'm also
10 the Director of a nonprofit CDC in the City of
11 Lorain, and the Mayor of Lorain has asked me to
12 make some remarks on his behalf today, so my
13 comments will really be coming from the Mayor's
14 testimony or letter to you, which is attached to my
15 comments.
16 The City of Lorain is about 25 miles west
17 of Cleveland on Lake Erie. It is a Rust Belt
18 city. It's a city of 71,000 people, 30 percent of
19 whom are minorities, and they break down 13 percent
20 African Americans, 17 percent Hispanic.
21 The citizens of Lorain, Ohio, which is a
22 community of mostly low to moderate income
23 families, have traditionally supported homegrown
24 financial institutions such as Lorain National
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1 Bank, Central Trust Bank, First Federal Savings and
2 Loan, Citibank, EST and Lorain County Savings and
3 Trust.
4 Mergers and acquisitions of the 80s and
5 90s have introduced a new banking trend, the
6 establishment of regional banking organizations in
7 the City of Lorain.
8 This trend was substantiated by the
9 following mergers and acquisitions: Elyria Savings
10 and Trust being acquired by First National Bank of
11 Akron which created First Merit bank. Central
12 Trust Bank being bought by Banc One. Citibank
13 closing all branches. Lorain County Savings and
14 Trust Bank acquiring a number of Central Trust Bank
15 locations and changing their name to Premier Bank
16 and Trust.
17 Most recently, in May of 1998, First Merit
18 and Premier Bank merged, closing 17 branches,
19 including two in the City of Lorain, and laying off
20 approximately 200 people.
21 You should be aware that the City of
22 Lorain has lost additional banking service
23 facilities and their related jobs. Banc One has
24 just closed two branches serving the low to
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1 moderate income neighborhoods of South Lorain, and
2 the Cityview, Sheffield areas. They were closed in
3 late Spring and early Summer, 1998, and these
4 closures parallel the proposed merger of Banc One
5 and First Chicago NBD.
6 The significance of these closings is
7 monumental, as they send a strong signal to the
8 city's low income population that even with Banc
9 One deposits at branches serving Lorain exceeding
10 $85 million, their business is not important.
11 Since the branches closed serve many low
12 to moderate income families who do not have
13 adequate transportation, many people will have
14 trouble getting to the remaining Banc One
15 branches.
16 According to Community Reinvestment Act
17 regulations, banks are supposed to reinvest in
18 communities like Lorain where they obtain their
19 deposits.
20 Banc One bought approximately 15 Central
21 Trust Bank branches in the 1980s, and today, they
22 have eliminated numerous jobs and closed or sold 12
23 branch locations, leaving three branches serving
24 Lorain. This appears to be disinvestment rather
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1 than investment.
2 Further, the City of Lorain has learned
3 from Kathleen Kaufin, the CRA Vice President of
4 Banc One, that branch locations ideally need to
5 have 35 to $40 million in deposits to meet Banc One
6 guidelines for profitability.
7 If Banc One continues to follow this rule
8 after the merger, it is likely that another branch
9 in Lorain will be closed. This would leave only
10 two locations in the city and only one of those
11 serving a low to moderate income area.
12 The City of Lorain has joined the
13 Coalition for Reinvestment in Lorain County and
14 other community groups from across the nation to
15 closely examine this merger which will result in
16 disinvestment in central cities and urban areas
17 across America, lost jobs, vacant and abandoned
18 buildings and an inaccessibility to convenient
19 banking services and products.
20 Ultimately, if uncontested and not
21 addressed by the Federal Reserve Bank, this mega
22 merger and acquisition progress will lead to the
23 erosion of high-quality, competitive banking
24 services only to be replaced by nonpersonal,
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1 high-cost electronic banking services provided by a
2 few large banks with almost no competition.
3 Working class families and individuals
4 such as the citizens of Lorain do not need to have
5 their disposable income further eroded due to
6 higher banking fees and costs.
7 Without a commitment to future
8 participation in our community along the lines
9 outlined above and as previously detailed in our
10 meeting with Banc One, it is not in the best
11 interest of the City of Lorain to endorse a mega
12 merger such as that being proposed by Banc One and
13 First Chicago NBD.
14 Thank you.
15 MS. SMITH: Thank you.
16 And we'll go to Ms. Rangan, who is
17 speaking on behalf of Inner City Press Community.
18 MS. RANGAN: Good afternoon.
19 My name is Rashmi Rangan, and I'm reading
20 the written testimony prepared by Matthew Lee,
21 Executive Director of Inner City Press Community on
22 the Move and of the Inner City Public Interest Law
23 Center, together, ICP.
24 ICP on April 28th filed a 38-page protest
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1 to this application along with Black Citizens for
2 Justice, Law and Order of Dallas, Texas and the
3 Delaware Community Interaction Council.
4 We are opposed to this proposed merger
5 primarily due to Banc One's continued predatory and
6 discriminatory practices through its Banc One
7 Financial Services subsidiary and due to the
8 anticompetitive and branch closing effects the
9 proposed merger will have, particularly in Indiana.
10 The commitments that First Chicago has
11 made in Detroit and Chicago do nothing to address
12 these issues, nor is Banc One's divestiture
13 proposal to sell off certain branches in Indiana
14 sufficient.
15 The proposed merger would also result in
16 substantial branch closings, making all the worse
17 Banc One's cynical manipulation of the target First
18 Chicago to make lending pledges in Chicago and
19 Detroit but not in the communities that would be
20 most affected by this merger, including through
21 branch closings.
22 In 1997, the Federal Reserve Board stated
23 in an order that it had unresolved questions about
24 the fair lending compliance of Banc One Mortgage
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1 Company and that its approvals were explicitly
2 conditioned on Banc One taking such actions as the
3 Federal Reserve might require.
4 Since then, the Arizona Attorney General
5 has charged Banc One with discrimination as
6 implicitly has HUD in Texas. The Fed has made no
7 disclosure of how or if this important issue has
8 been resolved, but 40 days ago, on July 2nd, we
9 made a request for this under the Freedom of
10 Information Act. The Fed has yet to provide the
11 documents.
12 The written comments we have submitted
13 show that in market after market, Banc One's normal
14 interest rate lenders disproportionately exclude
15 African Americans and Hispanics from credit, while
16 Banc One Financial Services, a high interest rate
17 lender, targets these communities for higher-priced
18 credit.
19 For example, in the Akron, Ohio MSA in
20 1996, Banc One Mortgage Company denied 55 percent
21 of mortgage applications from African Americans and
22 only 17 percent of applications from whites, a
23 denial disparity of 3.24.
24 The mortgage company originated 164 loans
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1 to whites and only seven to African Americans.
2 ICP's comments calls loans to African
3 Americans divided by loans to whites the index.
4 The ratio between BOMC's index and BOFS's index
5 calculated for each market can be viewed as the
6 targeting index.
7 In this particular MSA, for the mortgage
8 company, it was .043, and for the finance arm, it
9 was .193, 4.49 times higher than the mortgage
10 company. In Cleveland, Ohio, 4.47 times higher
11 than the mortgage company. In Dallas, 17.86 times
12 higher than the mortgage company. In Detroit, 5.61
13 times higher. In Gary, Indiana, 5.52 times
14 higher. Milwaukee, 8.53 times higher. These are
15 just examples of what the difference between the
16 two is.
17 The above analysis makes out a prima facie
18 case or red flag that Banc One Corp through its
19 normal interest rate lenders, including Banc One
20 Mortgage, and through its higher interest rate
21 lender, Banc One Financial Services, are engaged in
22 lending discrimination, including pricing
23 discrimination.
24 On this record, the Federal Reserve Board
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1 must conduct on-site fair lending examinations of
2 Banc One financial services.
3 On the current record, this mega merger
4 proposal which would expand Banc One's practices
5 could not legitimately be approved.
6 There are other adverse issues, including
7 the foreseeable loss of various First Chicago
8 programs and Banc One's record in its existing
9 states have been raised by Ohio and others.
10 For all the reasons stated, this proposed
11 merger should be denied.
12 Thank you.
13 And we will submit additional comments by
14 August 20th, 1998.
15 MS. SMITH: Thank you very much.
16 Ms. Sharpley.
17 MS. SHARPLEY: Hello. My name is Adenike
18 Sharpley. I'm a board member of the Zion Community
19 Development Corporation of Oberlin, Ohio.
20 Our target area is the southeast
21 quadrangle of Oberlin, which is a semi-rural area.
22 I am going to talk about the effects of
23 the Banc One merger on Oberlin, Ohio as a resident,
24 from a customer and employee point of view.
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1 The Oberlin Bank Building at 5 South Main
2 Street, Oberlin, Ohio, until the mid 1980s, was
3 primarily one bank. The Oberlin Bank Company
4 founded in 1889 would in 1904 combine with the
5 State Savings Bank and move to 5 South Main
6 Street. That same year, it would be renamed The
7 Oberlin Savings Bank. So for 76 years, the
8 community of Oberlin has had pretty much the same
9 bank.
10 In the mid-1980s, the musical bank
11 management began at 5 South Main Street. This
12 included in 1990 Central Trust, in 1996 Banc One,
13 in 1998 Premier Bank and the Merit transfer on
14 Labor Day of this year.
15 In 15 years, two local banks were lost,
16 Oberlin Savings Bank and People's Bank, with a host
17 of players to become one mega bank, one small local
18 bank, one savings and loan bank which is located or
19 comes its home out of Cleveland and one credit
20 union which is also based in Cleveland.
21 The staff working in these banks feel
22 intense stress from both bank officials, management
23 and customers.
24 The customer does not understand the
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1 changes in rules and regulations. The employee
2 must learn changes from old to new systems,
3 learning new rules and regs from the new bank and
4 absorb job shifts, moving from new offices to
5 maintain jobs while branches are closing.
6 These changes also include shifts in pay
7 scale which would be from lower to higher or vice
8 versa.
9 Most of the people absorbing these changes
10 are at the bottom of the chain, tellers, clerks, et
11 cetera, and most of these are women, head of
12 households or who are major bread winners in their
13 family.
14 From the customers' point of view,
15 customers have to deal with new hours, new staff,
16 new rules, new regulations and usually new banking
17 and service products.
18 The control of these banks are moved
19 further away from the customer. Their bank
20 managers are usually there a few days per week
21 along with what I call the roving loan officer.
22 Usually the new staff is less familiar
23 with the new branch and its customers are not
24 usually hired locally, therefore, do not know the
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1 community.
2 The new staff do not have a connection to
3 the community they serve. They are less willing to
4 cash checks for those without ID because they don't
5 know the customer. And in turn, the staff asks for
6 ID each time they see the customer, no matter how
7 many times they see them.
8 For the customer, this means fewer what I
9 call service value for their dollar, and this is
10 especially true for the low and moderate income
11 individual. This results in a transfer of wealth
12 aware from the community, benefitting the
13 stockholders, as I say, upstairs.
14 Along with no services such as utility
15 bill payment, no product for those who maintain
16 small balances in checking and savings accounts
17 without incurring charges against their account
18 each month, these charges will sometimes result in
19 customers finding that their account has been
20 closed by the end of the month. These customers
21 are usually low and moderate income people, seniors
22 on fixed incomes or those due to disabilities and
23 minorities.
24 At times, the above-mentioned group would
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1 receive unfriendly and discriminating treatment by
2 tellers, adding insult to injury, this classist and
3 racist behavior by tellers who treat their
4 constituency as if they have little or no money.
5 This leads to fewer service values for the elderly,
6 the disenfranchised and the people of color in the
7 Oberlin community.
8 Thank you.
9 MS. SMITH: Thank you very much.
10 And we'll go next to Ms. Tyler.
11 MS. TYLER: Why is it that Banc One has made no
12 commitment to Ohio but they have made commitments
13 in Michigan and Illinois?
14 Why is it that Banc One Financial Services
15 which offers higher interest rate loans has a more
16 aggressive marketing strategy in low income and
17 minority communities?
18 And how is it that the largest Midwest
19 bank can decide to get out of the home purchase
20 business?
21 These are questions on which I would like
22 to focus your attention for the nest few minutes.
23 I am Dawn Tyler representing the Ohio
24 Community Reinvestment Project, a project of the
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1 Coalition on Homelessness and Housing in Ohio.
2 OCRP's mission is to promote investment in
3 Ohio's low income communities and communities of
4 color.
5 Members of OCRP met with Banc One for
6 several months. Constructive dialogue took place
7 with representatives of the bank.
8 On numerous occasions, the bank gave us
9 every indication that they were willing to enter
10 into a community action agreement that would
11 ultimately increase lending, service and investment
12 opportunities within Banc One's service areas.
13 Some areas we were willing to set
14 reasonable benchmarks include home purchase loans,
15 small business lending, multi-family housing
16 investments and lending and community development
17 grants.
18 At the eleventh hour, however, about less
19 than a week before the end of the comment period,
20 the bank decided they did not want to move forward
21 with negotiations, and for those of you that were
22 here this morning, it sounds very similar to a
23 story told by Ted Thomas from ACORN.
24 Banc One's refusal to negotiate a
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1 meaningful community action plan for Ohio raises
2 questions about their commitment to Ohio
3 post-merger. The bank did not operate in good
4 faith.
5 Our primary concern is that this proposed
6 merger could have dramatic consequences for
7 financial services consumers throughout the State
8 of Ohio since the corporate headquarters of Banc
9 One currently based in Columbus will move to
10 Chicago. This merger could result in substantial
11 disinvestment in Ohio communities.
12 My second point is the disparate treatment
13 of African Americans in accessing credit for
14 mortgage loans from Banc One and its mortgage
15 company.
16 Low and moderate income consumers are
17 denied access to mortgage loans more frequently
18 than by other lenders, and Banc One lacks
19 aggressive marketing efforts to African American
20 and low and moderate income applicants,
21 particularly by the bank's affiliates and Banc One
22 Mortgage Company.
23 Rashmi has done a sufficient job of
24 sharing some statistics from Akron and Cleveland,
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1 so I will not repeat those details, but Banc One
2 Mortgage Company does not have an aggressive
3 lending record to minorities and low and moderate
4 income applicants.
5 Banc One Financial Services, the BNC
6 lender, charges customers higher interest rate
7 loans compared to rates offered by Banc One
8 Mortgage Company and is engaged in extremely
9 aggressive marketing practices through direct mail
10 and phone solicitation which targets low and
11 moderate income people in minority census tracts.
12 This is a clear illustration of the
13 predatory lending practices of Banc One Financial
14 Services which disproportionately targets African
15 Americans for higher interest rate credit,
16 originates loans at a higher rate than the mortgage
17 company.
18 The bank should offer A loans to all
19 applicants who qualify, regardless if they come
20 into the bank, the mortgage company or financial
21 services.
22 We encourage the Feds to follow the lead
23 of the OCC as in the case of First Union Money
24 Store and mandate that Banc One offer prime loan
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1 products to all who qualify.
2 Thirdly, Banc One has decided to get out
3 of the home purchase business.
4 It was interesting to hear about the new
5 self-help product that was mentioned this morning,
6 however, historically, the bank has ignored the
7 credit needs of LMI communities. This is
8 unacceptable for a bank the size of Banc One.
9 And my fourth issue relates to small
10 business lending which Chuck Bromley, our OCRP
11 Chairperson, has shared on the previous panel.
12 Time does not permit for me to talk about
13 the over 60 branch closures that have taken place
14 in Ohio or the $8 check cashing fee that's imposed
15 on Banc One customers.
16 In closing, we do not dispute the fact
17 that Banc One, especially the CDC, has been active
18 in areas such as tax credit projects and community
19 development grants to nonprofits, however, there
20 are no safeguards in place to ensure that this is
21 continue after the merger.
22 We ask the bank to make some very basic
23 commitments to minimize the potential negative
24 impacts, and after dragging us along for several
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1 months, they refused, despite the fact that they
2 are planning to honor similar commitments in the
3 communities of Chicago and Detroit.
4 The bank claims that no market will be
5 abandoned and the commitment will continue. If
6 this is the case, why is there such a hesitancy on
7 the part of the bank to put such a commitment in
8 writing?
9 Earlier today, Banc One mentioned one part
10 of their recipe for success is relationships with
11 local partners. How can I as a local partner be
12 part of that recipe for success when I've been
13 kicked out of the kitchen?
14 Please consider carefully the information
15 that has been presented today. I urge the Federal
16 Reserve to postpone the merger until mutually
17 beneficial community action plans have been reached
18 in all of Banc One's markets.
19 Your meaningful intervention can
20 facilitate fair lending, service and investment
21 opportunities in Ohio's low income communities and
22 communities of color that have historically been
23 overlooked and underserved.
24 MS. SMITH: Thank you.
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1 Ms. Walker.
2 MS. WALKER: I'd like to thank the Federal
3 Reserve to have the freedom to speak today.
4 I am Marge Walker, and I'm a resident of
5 the City of Lorain, 30 miles west of Cleveland, and
6 I'm speaking on behalf of the South Lorain
7 Merchants Association.
8 I have been a hairdresser for a long time,
9 and due to situations, I have been had to be
10 retrained because I can no longer stand for long
11 periods of time.
12 My neighborhood is adjacent to an old
13 steel plant that once employed 7,000 men. It now
14 employs less than 2,000 people. Can you imagine
15 what it does to a community?
16 Once Banc One's retail operations have --
17 the severe cutback in Lorain County. We are told
18 that the cutback has nothing to do with the
19 merger. In my perspective, it has everything to do
20 with the merger because that is the trend of the
21 country these days.
22 Money loaning and the -- are joining with
23 the money grabbing businesses. Our Banc One branch
24 that just closed, it has five million dollars in
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1 it. I guess it's not enough money. They says it's
2 nothing personal, but business is business.
3 I would like to talk about trends. The
4 Federal Reserve reports -- own report seems to
5 conclude that small business lending suffers when
6 big banks buy smaller banks.
7 Small bank -- small business lending
8 depends upon relationships with neighborhoods,
9 merchants, and big banks don't look at their
10 operations over the long-term with the investment
11 in the community.
12 We are told that the United States is fast
13 approaching a time when whites will be in the
14 minority. I recently read that the buying power in
15 the Black community has grown recently to 8.2
16 percent in the consumer economy. With this kind of
17 trend underway, how is it that the bottom line,
18 conscientious banks haven't the foresight to
19 actively pursue the growing minority market.
20 If all these bank branches and the lending
21 institutions are, in fact, race neutral, why aren't
22 we seeing fierce competition for the minorities?
23 People forget the depositors contribute
24 more money to the banks than the stockholders, but
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1 every time I turn around, there are always fewer
2 advantages for depositors and more and more for the
3 stockholders.
4 The depositors have fewer banks to go to,
5 fewer hours to get service from and fewer staff who
6 are shifted around in the system so that there is
7 no relationship with the community. Deposits earn
8 less and less interest while fees go up and up.
9 So while some executives get very rich and
10 stockholders look to increase their return on
11 investments and lower returns on their deposits and
12 increased costs.
13 Now banks have made it clear that they
14 don't want to be banks anymore, they want to be
15 stockbrokers, insurance agents, pension advisors,
16 investment specialists, et cetera. They want to
17 cross-sell their customers into every conceivable
18 financial imaginary product except plain,
19 old-fashioned human-oriented service.
20 Just once I would like to see the
21 announcement of another bank merger or acquisition
22 that would conclude with the following sentence:
23 The merger is subject to regulatory and depositor
24 approval.
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1 If depositors had a voice in these
2 matters, maybe the executives, high fliers and
3 golden parachuters would have to promise them
4 higher interest rates on a deposit, lower fees and
5 more locations and longer hours and better service
6 to people.
7 This regulatory body is all that stands
8 between the voice of depositors and the greedy
9 money grabbing depositors -- at depositors'
10 expense.
11 You are duty bound to look at the
12 competition, convenience and the needs of the
13 communities.
14 On behalf of South Lorain Merchants
15 Association, I want to tell you to deal with
16 this -- tell you this deal does not create
17 competition. We need competition in the
18 community. We have an example right now with BP
19 and Amoco merging. We're losing a thousand jobs in
20 Cleveland and the space that it takes for rental in
21 Cleveland.
22 If you continue along the lines of having
23 less competition, there's going to be no
24 competition. How many banks are going to be left
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1 when we get through with all this?
2 As somebody earlier had commented about
3 having 9,000 banks at one time and now it's getting
4 down to less and less, what are you going to do
5 when there's no competition, when there's nobody to
6 go to?
7 That's it.
8 MS. SMITH: Thank you very much.
9 Any questions?
10 MS. WILLIAMS: I've got one.
11 MS. SMITH: Okay. We have a question.
12 MS. WILLIAMS: This is for Mr. Bellamy.
13 You mentioned that subprime lending went
14 from 3 to 15 percent. Was this in Lorain County,
15 and over what period, and was this percentage for
16 one institution?
17 MR. BELLAMY: This is for Banc One. This is in
18 Lorain County only. This is for Banc One.
19 And the financial services subprime
20 lending branch of Banc One just came into the
21 county in '93, and at that time, they had, as I
22 say, only three percent of the total investments in
23 the low to mod areas.
24 In 1996, the financial services branch,
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1 the subprime lender, is up to 15 percent of the
2 residential lending in that same category of low to
3 mod areas.
4 MS. WILLIAMS: Okay. Thank you.
5 MS. SMITH: Thank you very much.
6 I will remind people that you may submit
7 written supplements to your oral testimony by next
8 Thursday, August the 20th. And the information
9 about where to provide them has, I think, been
10 given to you, or you can get them from the
11 registration desk.
12 We're scheduled for a ten-minute break.
13 We're about a half an hour behind schedule. I
14 think we're going to save five minutes by cutting
15 it to a five-minute break, so we'll see you here
16 very soon. And I think the timers are going to
17 time us.
18 (Whereupon, a recess was
19 taken.)
20 (Whereupon, further proceedings
21 were had which are bound under
22 separate cover.)
23
24
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1 PUBLIC MEETING REGARDING THE PROPOSAL BY
2 BANC ONE CORPORATION, COLUMBUS, OHIO,
3 TO MERGE WITH
4 FIRST CHICAGO NBD CORPORATION, CHICAGO, ILLINOIS
5
6
7 Proceedings had in the above-mentioned
8 cause, on Thursday, the 13th day of August,
9 1998, at The Federal Reserve Bank of Chicago,
10 230 South LaSalle Street, Chicago, Illinois, at
11 9:00 o'clock a.m.
12
13
14
15 VOLUME II
16
17
18
19
20 REPORTED BY: Brenda S. Tannehill, CSR
21 LICENSE NO.: 084-003336
22 -and-
23 REPORTED BY: Jeanette A. Sandei, CSR
24 LICENSE NO.: 084-003685
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1 (Whereupon, proceedings were
2 previously had which are bound
3 under separate cover.)
4 MS. SMITH: We're starting with Mr. Ruf.