Public Meeting Bank of America Corporation and Countrywide Financial Corporation

Held on Tuesday, April 22, 2008, at the Federal Reserve Bank of Chicago

Unedited transcript

 1                      PUBLIC MEETING
 3                     CHICAGO, ILLINOIS
 7   the above-entitled matter held on April 22, 2008, at
 8   the Federal Reserve Bank, 230 South LaSalle Street,
 9   Chicago, Illinois, MS. SANDRA BRAUNSTEIN,
10   presiding, commencing at 8:30 o'clock a.m.
12       PRESENT:
13            MS. SANDRA BRAUNSTEIN, Director, Board of
14                 Governors of the Federal Reserve
15                 System
16            MS. JENNIFER BURNS, Vice President,
17                 Federal Reserve Bank of Richmond
18            MS. PATRICIA ROBINSON, Assistant General
19                 Counsel, Board of Governors of
20                 the Federal Reserve System
21            MS. ALICIA WILLIAMS, Vice President,
22                 Federal Reserve Bank of Chicago
 1       MS. BRAUNSTEIN:  I think we'll get started.
 2   Good morning everybody.  And I am pleased to
 3   welcome you this morning to this very important
 4   public meeting on the application by Bank of
 5   America Corporation to acquire Countrywide
 6   Financial Corporation.
 7            First I'll introduce myself, I'm Sandra
 8   Braunstein, director of the Division of Consumer
 9   and Community Affairs at the Federal Reserve Board
10   in Washington, DC.
11            And I am the presiding officer for this
12   public meeting, and our other panelists today, next
13   to me on my right is Patricia Robinson who's the
14   assistant general counsel at the Federal Reserve
15   Board's legal divison, and next to her is Jennifer
16   Burns, vice president in the Department of Banking
17   Supervision and Regulation from the Federal Reserve
18   Bank of Richmond, and next to me on my left is
19   Alicia Williams, vice president in the Department
20   of Consumer and Community Affairs from the Federal
21   Reserve Bank of Chicago.
22            We are here today because the Bank of
23   America Corporation in Charlotte, North Carolina
24   has applied for approval to acquire Countrywide
 1   Financial Corporation, Calabasas, California.
 2            When the Federal Reserve System considers
 3   an application, we look at a number of factors
 4   under the Bank Holding Company Act, and these
 5   include financial issues, managerial issues,
 6   competitive issues, and the convenience and needs
 7   of the communities affected.  In doing so we
 8   particularly look at the record performance of the
 9   parties under the Community Reinvestment Act or
10   CRA.
11            The CRA requires the Board to take into
12   account an institution's record of meeting the
13   credit needs of its entire community.  The purpose
14   of the public meeting today is to receive
15   information regarding these factors and to clarify
16   factual issues related to the application.
17            We are pleased that so many witnesses have
18   been willing to come forward and testify at this
19   public meeting.  We will have about fifty groups
20   and individuals represented, and I just want to
21   make a few remarks about the procedures.
22            This is what we call an informal public
23   meeting.  Members of the panel, our panel up here,
24   may ask those who are testifying about their
 1   testimony, but this is not a formal administrative
 2   hearing so we are not bound by rules regarding
 3   evidence, cross examination, and some of the formal
 4   trappings of that kind of proceeding.
 5            Because we have so many witnesses we will
 6   need to stick to the schedule so that everyone who
 7   is asked to offer testimony will have a chance to
 8   do so.  So we're going to ask the witnesses today
 9   to be mindful of the needs of others and to help us
10   stay on schedule.
11            The panels of witnesses will be expected
12   to keep within their allotted times, and to help us
13   with that, we have a signal system that will -- we
14   have a time keeper who is right there.
15            We have two time keepers.  Can you lift
16   your hands higher so people in the audience can
17   see?  Okay.  And the time keepers are going to give
18   you a signal, when you have two minutes left, there
19   is -- first of all, there's a little box here for
20   those of you who are coming up to testify you will
21   see, there's a box with lights on it and there's a
22   white light, a yellow light, and a red light, and
23   the yellow light will come on, and also you'll get
24   a sign when you have two minutes left, and then the
 1   red light will come on and you'll get a sign when
 2   it's time for you to stop.
 3            There may have been some individuals who
 4   were unable to sign up in advance, and to the
 5   extent possible we want to give them a chance to
 6   speak as well.
 7            At the end of the meeting today, we will
 8   make -- have an open mike period where we will make
 9   the mike available to anybody who would like to
10   make a presentation time permitting.
11            One more comment about testimony.
12   Witnesses may submit a written supplement to their
13   oral testimony but must do so by next Tuesday,
14   April 29th.  Then the record will be closed.
15            Any written supplements should be directed
16   to Jennifer Johnson, Secretary of the Board of
17   Governors of the Federal Reserve System in
18   Washington, D.C. and they must be received by
19   5:00 p.m. on April 29th.  And there's also a fax
20   number, and if you need this information you can
21   get it from the registration table.
22            If you haven't turned in your written
23   testimony or if you have other written statements
24   to put into the record you can also leave them with
 1   the Federal Reserve staff at the registration
 2   table.
 3            It's important we get this material for

 4   the record.  A hard copy of the official transcript
 5   will be available sometime next week through the
 6   Federal Reserve Bank of Chicago and the Board, and
 7   the official transcript will also be up on the
 8   Board's website next week.
 9            And with that we're going to start the
10   proceedings.  I would ask that before each panel
11   speak, and this will be true for everybody today,
12   could you please introduce yourself, your name and
13   your organization.  And with that, I don't know,
14   Mr. Hammonds.
15       MR. HAMMONDS:  Good morning.  My name is Bruce
16   Hammonds, I'm president of consumer/credit at Bank
17   of America.
18            Joining me today is Andrew Plepler, senior
19   vice president of Bank of America responsible for
20   community development and president of the Bank of
21   America Charitable Foundation, and David Rudis who
22   is the Bank of America market president for
23   Illinois.
24            We would like to thank the Federal Reserve
 1   for this opportunity to discuss the benefits of
 2   Bank of America's proposed acquisition of
 3   Countrywide Financial Corporation.
 4            Our combined company will offer high
 5   quality service and innovative products, and these
 6   will be delivered by our employees and anyone who
 7   does business on our behalf with the same
 8   dedication to the highest standards of trust and
 9   integrity that our customers and employees and
10   shareholders expect from Bank of America.
11            We recognize responsibilities that come
12   with being the nation's largest mortgage lender
13   particularly in the current environment.
14            During 2007 significant disruptions
15   occurred in the U.S. mortgage market and the global
16   capital markets.  Industry experts acknowledge the
17   downturn was caused by unsustainable home price
18   appreciation which was particularly pronounced in a
19   few regions.  In this environment a correction was
20   inevitable.
21            As we lead through this correction, we
22   must seek through responsible lending to encourage
23   more buyers to return to the housing market.  In
24   doing so Bank of America must balance the need to
 1   continue to offer home loan products to those who
 2   can afford them while evolving lending practices to
 3   reflect a dramatically different mortgage
 4   environment.
 5            This evolution in no way deters us from
 6   our mission in helping Americans achieve their
 7   dreams of home ownership.
 8            We also recognize that some customers with
 9   the wherewithal to repay their debts need our help
10   to keep their homes, and we are determined to
11   provide that help.
12            To accomplish these goals we will improve
13   the mortgage origination process end-to-end
14   including the products we offer, our sales and
15   underwriting standards and channels of
16   distribution.
17            We will reduce the number of foreclosures.
18   We will help the communities hardest hit by
19   foreclosures, and we will continue to make
20   affordable mortgages available to those
21   traditionally underserved including low and
22   moderate income households and minorities.
23            Today I will share with you our plans with
24   regard to future lending practices and future
 1   efforts to strengthen consumer protection and
 2   transparency for our customers obtaining home loan
 3   products.  I will also discuss current efforts of
 4   both Bank of America and Countrywide to stem the
 5   rising number of foreclosures.
 6            Next week in Los Angeles we will announce
 7   more specific plans to help communities through
 8   affordable mortgage lending, grants and additional
 9   steps specific to foreclosures as Bank of America
10   Global Consumer and Small Business president, Liam
11   McGee, provides remarks at that public hearing.
12            Let me start by describing the benefits of
13   this transaction.  Countrywide is the largest
14   provider of mortgage products in the United States.
15   It is the nation's premier mortgage origination,
16   fulfillment and servicing platform.  Combining
17   these two companies will benefit customers of both
18   organizations.
19            Countrywide's customers will gain access
20   to a full range of banking services while Bank of
21   America's customers will gain access to better
22   mortgage services.
23            We will enhance shareholder value by
24   working hard to broaden and deepen customer
 1   relationships and more efficientlly enhance loan
 2   origination and fulfillment capabilities.  Our
 3   customers, communities, employees, and shareholders
 4   will benefit from the financial strength and
 5   stability of the combined company.
 6            Bank of America's diverse business model
 7   is built to weather turbulent times.  Our combined
 8   company will be better able to continue offering
 9   financial solutions to customers and to assist
10   customers hardest hit by the current mortgage
11   crisis.  This acquisition will position us to
12   prosper as markets improve.
13            Many have asked what changes we plan to
14   make in light of the current market conditions.  As
15   I noted at the outset, upon completion of the
16   acquisition we intend to meaningfully change the
17   end-to-end mortgage origination process starting
18   with our products.
19            Our combined mortgage business will offer
20   a range of products that continue to respond to
21   market conditions and consumer demands with
22   features that are fair to our customers.
23            Specifically we expect to offer a broad
24   array of responsible lending products and employ
 1   sound underwriting criteria to ensure customers can
 2   get in and stay in their homes.
 3            To this end the combined mortgage business
 4   will offer retail customers the following types of
 5   first lien mortgage loans:
 6            Conforming loans underwritten to standard
 7   guidelines of government sponsored entities and the
 8   government including expanded approval loans,
 9   FHA/VA loans, and other loans designed for low and
10   moderate income borrowers;
11            Interest only, fixed rate, and adjustable
12   rate products subject to a ten-year minimal
13   interest only period which will lessen the
14   possibility of short term payment shock;
15            And fixed-period ARMs that provide
16   borrowers low initial rates with the security of
17   fixed payments subject to protections against
18   severe step-ups in payment amounts.
19            Upon the completion of the merger we will
20   continue our long established policy not to offer
21   subprime mortgage loans, not offer non-traditional
22   mortgages that may result in negative amortization,
23   so-called option ARM loans, and significantly
24   curtail other non-traditional mortgages such as
 1   certain low documentation loans.
 2            We recognize this tightening by definition
 3   restricts the availability of credit to subprime
 4   borrowers.  However this will help ensure that
 5   borrowers who get loans can afford to repay them.
 6            Moreover we remain committed to offering
 7   affordable mortgage loans particularly to LMI and
 8   minority households as Andrew will explain in a
 9   minute.
10            Additionally Bank of America is committed
11   to enhance consumer protection.  We listen to our
12   customers who felt the lack of transparency in the
13   process of acquiring a home loan created fear and
14   anxiety.  We will continue to strive to ensure that
15   borrowers are presented with an appropriate range
16   of product options for which they qualify, that
17   borrowers understand the product features and make
18   informed choices, and that borrowers are not
19   deliberately steered to products that are more
20   costly or that provide no benefits.
21            The combined mortgage business also will
22   adopt early added protection for borrowers who
23   receive higher priced mortgage loans which
24   generally have been associated with riskier loan
 1   types.
 2            Upon the effective date of the Federal
 3   Reserve's final revised rule under the Home
 4   Ownership and Equity Protection Act we will
 5   voluntarily adopt our own definition of higher
 6   priced mortgage loans.
 7            Consistent with the Federal Reserve's goal
 8   of consumer protection we will apply restrictions
 9   to those loans substantially similar to those
10   proposed by the Federal Reserve.
11            We also plan to adopt practices with
12   regard to prepayment penalties and escrows that are
13   responsive to consumer demands while reflecting
14   prudent risk management.
15            We will offer our customers choices to
16   have loans with prepayment fees and a lower
17   interest rate or loans without.
18            We will ensure that our fees are
19   transparent and clearly disclosed so that our
20   customers understand available product options,
21   features, rates and terms that are consistent with
22   borrower qualifications.
23            I also want to talk about what we are
24   doing to help borrowers facing delinquency and
 1   foreclosure.  Home foreclosures are a significant
 2   issue today.
 3            Foreclosures are painful and costly to
 4   homeowners and their neighborhoods.  They also
 5   prolong the housing correction by adding to the
 6   inventory of unsold homes.
 7            Like the rest of the industry we are
 8   experiencing increased foreclosures and foreclosure
 9   sales, but we need to put foreclosures in
10   perspective.
11            First, 12.8 million or 93 percent of the
12   13.6 million owners whose mortgage loans we will
13   service following the acquisition of Countrywide
14   pay their mortgages on time every month.
15            Of the remaining seven percent only a
16   fraction of those who miss their payments are in
17   foreclosure.
18            Our experience shows these foreclosures
19   are concentrated in subprime borrowers.  Other
20   borrowers were investors or speculators.  In other
21   cases borrowers simply cannot afford the homes they
22   bought and the current housing slump makes it
23   difficult for them to sell their homes.
24            Subtracting the speculators leaves us with
 1   our target population of borrowers for whom we are
 2   seeking a solution, those who want to keep their
 3   homes and have the financial wherewithal but are
 4   facing challenges making their monthly payments.
 5   We are focused on doing all we can to help these
 6   borrowers.
 7            The combined mortgage business will
 8   continue to devote substantial financial and other
 9   resources during the current market downturn to
10   help borrowers to avoid foreclosures and remain in
11   their homes.
12            We will continue practices already in
13   place to help borrowers avoid foreclosure.  These
14   include:  Robust processes for identifying and
15   contacting borrowers early who are having or may
16   have trouble making their mortgage payments
17   including customers who may be facing significant
18   rate increases;
19            Special strategies for subprime borrowers
20   holding adjustable rate mortgages for which the
21   rates are about to reset or have already reset;
22            Refinance, modification and other
23   restructure tools that make the borrower's debt
24   affordable and allow him or her to stay in their
 1   home;
 2            And substantial financial and other
 3   resources devoted to these tasks to ensure maximum
 4   responsiveness for our customers.
 5            As a result of the significant efforts
 6   both companies have made over the past year, more
 7   than 138,000 homeowners received modified or other
 8   workout loans and avoided losing their homes.
 9            While much has been accomplished in this
10   difficult environment there is more to do, and next
11   week at the hearing in Los Angeles, Liam McCGee
12   will provide information about foreclosure and loss
13   mitigation plans for the combined company.
14            As I noted at the outset, in our role as
15   the nation's largest mortgage lender we will also
16   continue to help meet the needs of the communities
17   we serve.
18            Andrew Plepler will now describe our
19   efforts to date and plans in this area.
20       MR. PLEPLER:  Thank you, Bruce.  Good morning.
21   My name is Andrew Plepler.
22            Bank of America's commitment to
23   strengthening the health and vitality of
24   communities stems from a deeply ingrained
 1   philosophy and a long tradition of demonstrating
 2   corporate citizenship through community development
 3   and philanthropy.  In particular, by partnering
 4   with nonprofits and community leaders we
 5   concentrate on improving the lives of low and
 6   moderate income and minority families in
 7   neighborhoods.
 8            Our company has received five consecutive
 9   outstanding CRA ratings reflecting our community
10   development focus.
11            In addition, the Bank of America
12   Charitable Foundation is the second largest
13   corporate donor in the world.
14            For many years Bank of America has been
15   recognized for its community development work.  The
16   vast majority of these activities are the results
17   of our line of business products and services we
18   provide to customers and communities.
19            In more specific areas of community
20   development we have leveraged our knowledge and
21   expertise to become a national leader in affordable
22   housing, small business lending, and neighborhood
23   revitalization, and we are recognized for our
24   results in creating sustainable community and
 1   economic development through public private
 2   partnerships.
 3            Since 2004 our company has been delivering
 4   on an ambitious ten-year goal of $750 billion for
 5   community development loans and investments.  To
 6   provide just a few proof points consider some of
 7   our 2007 results:
 8            More than $100 billion in community
 9   development loans and investments to low and
10   moderate income and minority families, businesses,
11   and communities;
12            Financing, developing, and rehabbing
13   nearly 22,000 units of affordable housing;
14            $25.6 billion in small business lending,
15   and the number one SBA lender for the tenth
16   consecutive year;
17            Investing more than $84 million in
18   community development financial institutions or
19   CDFI's.
20            Because we also believe that affordable
21   quality rental housing is critical to our national
22   housing stock we have been a leader in financing to
23   non-profit and for profit developers.
24            Bank of America remains a strong player in
 1   this space and has expanded its capability to
 2   direct low income housing tax credit investments to
 3   ensure continuity and capacity in this rental
 4   market.
 5            In addition to our community development
 6   goal the Bank of America Charitable Foundation set
 7   an unprecedented $1.5 billion goal in 2004 for
 8   philanthropic giving over ten years.  Since then we
 9   have invested more than $550 million toward
10   increasing the health and vitality of neighborhoods
11   throughout our franchise.
12            Through signature programs like our
13   Neighborhood Excellence Initiative we are helping
14   increase the capacity of community organizations
15   develop the current and the next generation of
16   community leaders and create significant impact in
17   the communities we serve.
18            By also supporting anchor institutions
19   such as hospitals, universities, and cultural
20   institutions we are helping to create jobs and
21   stimulate economic development to enhance the
22   quality of life in diverse neighborhoods.
23            In addition our associates provide
24   tremendous support as volunteers in the communities
 1   where we live and work.  A local example of a
 2   not-for-profit we have supported is Bethel New
 3   Life.
 4            This organization is empowering
 5   individuals, strengthening families, and building a
 6   sustainable community.
 7            Bethel brought in more than $110 million
 8   in new investments to a credit starved community
 9   and developed more than a thousand units of
10   affordable housing in Chicago's west side.
11            Through the neighborhood Excellence
12   Initiative Bethel's president and CEO, Steven
13   McCullough, attended leadership training and the
14   organization received a $200,000 operating support
15   grant.
16            Some of our 2007 philanthropic activities
17   include more than $200 million in charitable
18   giving.  Grants were made to 4800 nonprofits for
19   education and youth programs, health and human
20   services, community development, arts and culture,
21   and the environment.
22            More than 50 percent of our grants were
23   CRA qualified, directly benefiting LMI individuals
24   or neighborhoods, and contributing more than
 1   650,000 employee volunteer hours and more than $20
 2   million in charitable donations by our employees to
 3   help meet pressing community needs.
 4            We recognize the needs are great.  We
 5   pledge our ongoing support as we have in the past
 6   in addressing community needs, especially in
 7   challenging economic times as we now face.
 8            To that end I'm proud to announce that the
 9   Bank of America Charitable Foundation and
10   Countrywide will provide $35 million in grants and
11   program related investments as part of our
12   neighborhood stabilization program.
13            These funds will help local and national
14   nonprofits engaged in foreclosure prevention and to
15   purchase vacant single family homes for
16   neighborhood stabilization.
17            At Bank of America we have a remarkable
18   franchise dedicated to leveraging our broad
19   financial reach, our financial capacity and
20   capability, and our deep commitment to
21   strengthening communities.
22            We take our leadership role very seriously
23   as demonstrated by our $750 billion goal for
24   community development and our $1.5 billion goal for
 1   philanthropy.  We hold ourselves accountable to
 2   create real change, and we publicly report on our
 3   progress toward these goals.
 4            I want to just give two other specific
 5   instances where Bank of America serves as a good
 6   corporate citizen.
 7            First is supplier diversity.  Bank of
 8   America is committed to fostering diversity in our
 9   communities and has incorporated that commitment as
10   a core value in our business practices.
11            We developed an aggressive program of
12   outreach and business development to grow these
13   opportunities.
14            We are proud that more than 16 percent of
15   our company's sourceable spend in 2007 were with
16   firms that are majority owned by women, minority,
17   or people with disabilities.
18            Second is the environment.  Bank of
19   America is recognized as a leader for its advocacy
20   of efforts to reduce greenhouse gases and support
21   responsible, sustainable development.
22            We have dedicated $20 billion over ten
23   years for an environmental initiative to support
24   these efforts.
 1            We recently announced that Bank of America
 2   has adopted the carbon principles, guidelines for
 3   lenders to promote cleaner energy technologies.
 4            We are also very proud that our new Bank
 5   of America tower in New York City has been
 6   recognized widely as one of the most
 7   environmentally friendly buildings in the world.
 8            In short Bank of America is and will
 9   continue to be committed to the communities that we
10   serve.  By providing local, relevant support to
11   neighborhoods we will continue to create
12   opportunities for our customers, employees, and
13   communities to grow and prosper.
14            We know that we are most effective by
15   partnering with nonprofit organizations and
16   community leaders to identify and address the
17   challenges that together we can overcome.
18            Now I'll turn it to David to give you a
19   local perspective of our community leadership and
20   activities.
21       MR. RUDIS:  Thank you, Andrew.  I've David
22   Rudis, Bank of America, Illinois president.
23            In my role as Illinois president I focus
24   exclusively on the Illinois market and especially
 1   on Chicago.  I'm proud to Chicago home for the last
 2   37 years.
 3            It's our goal to build the Bank of America
 4   brand in Chicago and Illinois and to strengthen our
 5   relationship with our clients, employees, and the
 6   community at large.
 7            You will see the Bank of America name and
 8   brand even more in Chicago as we approach the day
 9   when LaSalle Bank becomes part of the Bank of
10   America family.  You will see visible changes like
11   signs, advertising, other changes in just a couple
12   of weeks.
13            However, the signs might change but the
14   traditions will continue.  We're proud to continue
15   many iconic traditions the community has supported
16   in the past, including our continued sponsorship of
17   the Chicago Marathon and the soon to be renamed
18   Chicago LaSalle Theatre.
19            These brand changes and the continued
20   support of these Chicago traditions are important,
21   but what Bank of America has committed to the
22   community is even more important.
23            We have adopted a strategic community
24   development plan specific to Illinois that has the
 1   goal of funding $70 billion over ten years to
 2   support local affordable housing, consumer small
 3   business and farm lending, and economic
 4   development.
 5            This is part of Bank of America's
 6   nationwide goal for community development.  This
 7   Illinois goal represents a 31 percent increase over
 8   past production of LaSalle Bank and Bank of America
 9   in the region.
10            Bank of America's Charitable Foundation
11   has also pledged $14 million in support of local
12   causes in Illinois this year.
13            Last year we announced $5 million in
14   grants to address some of Chicago's most pressing
15   community challenges including work force
16   development, winter heating assistance for low
17   income individuals, financial literacy, and after
18   school activities and foreclosure prevention.
19            We conduct extensive community outreach to
20   ensure that we more fully understand and address
21   local needs.  This work is already creating results
22   in Chicago neighborhoods.
23            Let me highlight just a few.  The $2
24   million in grants for foreclosure prevention
 1   counseling will enable twelve different
 2   organizations to hire 20 foreclosure prevention
 3   counselors.  These counselors will work to preserve
 4   affordable home ownership through post purchase
 5   education and help low and moderate income
 6   homeowners maintain and protect their investment.
 7            The $1 million grant for Opportunity
 8   Chicago is helping 11,000 low income public housing
 9   residents address their education, training, and
10   job placement needs to achieve economic self
11   sufficiency.
12            In addition, related to our work with
13   public housing we have provided more than
14   $128 million in financing for projects that are
15   part of the Chicago Housing Authority's plan for
16   transformation.
17            Under this plan the Chicago Housing
18   Authority is redeveloping and rehabilitating more
19   than 25,000 units of public housing and represents
20   the largest reconstruction of public housing in the
21   nation's history.
22            The $1 million grant to help low income
23   people with winter heating assistance has helped
24   more than 4,000 people this past winter.
 1            I would also note that locally more than
 2   80 percent of our charitable giving in 2007 was CRA
 3   qualified directly benefiting low and moderate
 4   income individuals and neighborhoods.
 5            I'm also proud of my Bank of America
 6   teammates who volunteer their time and energy to
 7   meet a wide range of community needs.
 8            Just this past tax season we continued our
 9   annual participation in the City Wide Tax
10   Assistance Program.  This year more than 60
11   employees have helped 300 low income families
12   receive $400,000 in Federal and state tax refunds.
13            These initiatives are just a few oft he
14   examples of our ongoing work in the community.  As
15   Bank of America president for Illinois I am looking
16   forward to expanding and deepening our
17   relationships with our community partners.
18            We are committed to partnering new and
19   innovative ways to make a positive difference in
20   our community.   Thank you.  I'll now call on Bruce
21   for concluding remarks.
22       MR. HAMMONDS:  To conclude, we appreciate the
23   Federal Reserve for this time to present this brief
24   overview of our business principles and practices.
 1   We encourage the Federal Reserve Board to act
 2   swiftly to approve Bank of America's application.
 3            Bank of America's record of one of the
 4   lowest foreclosure rates in the country
 5   demonstrates a strong history for meeting the
 6   convenience and needs of the community.
 7            We have outlined how the acquisition will
 8   enable Bank of America to make an even greater
 9   impact in the future.  Thank you.
10       MS. BRAUNSTEIN:  Thank you very much.  Does the
11   panel have any questions?
12       MS. ROBINSON:  I have a question.  What
13   specific actions, if you can disclose today, that
14   you plan to take to do outreach to the Countrywide
15   customer who may be troubled to help mitigate, you
16   know, and/or restructure their loans, et cetera, or
17   do other outreach?
18            And a second part to that question is much
19   has been reported that one of the difficulties is
20   actually contacting those borrowers and getting
21   them to, you know, engage in conversation with
22   borrowers, and what actions, if any, are you
23   planning to take with the local community groups or
24   other measures that you would be taking to help
 1   assist in that process?
 2       MR. HAMMONDS:  Well, first in terms of
 3   mitigation around those kinds of things, Liam McGee
 4   is going to lay out more of that in Los Angeles
 5   last week.
 6            I will tell you that today we have a
 7   transition team of literally hundreds of people
 8   looking at the best practices at both Bank of
 9   America and Countrywide and starts with early
10   ability to get customers on the telephone and try
11   and work with those customers.
12            In some cases I know that we've even sent
13   people out to the home, we've sent cell phones to
14   the homes so people could call us on the cell
15   phones, and things of that nature.
16            So it's extremely important that we get to
17   people early and work out their -- and make an
18   early solution to the workout program.  But as I
19   said, Liam will explain more of that in Los Angeles
20   next week.
21       MS. WILLIAMS:  Hi.  Could you talk a little bit
22   more about what you said earlier about your own
23   definition of high priced loans that you would
24   adopt?
 1       MR. HAMMONDS:  We are still putting that
 2   together, but until formal adoption is made we will
 3   come out with our own interpretation of that, but
 4   we are still working through those details.
 5       MS. WILLIAMS:  And then how would that relate
 6   to what the Board is doing?
 7       MR. HAMMONDS:  Well, it would be very much in
 8   line with everything that we think you will do in
 9   that regard.  We're going to follow your guidelines
10   on that.
11       MS. BRAUNSTEIN:  Okay.  Thank you.  I want to
12   thank the panelists very much.  Next panel I see,
13   Reverend Jackson.  Do you want to step forward?
14            Welcome Reverend Jackson, and our time
15   keepers are over here, and you will see lights --
16   you will see the green light, you can keep talking,
17   the yellow light will tell you you have two minutes
18   left, and the red light when it's time to stop.
19            And could you please start out by
20   introducing yourself and starting the name of your
21   organization.
22       REVEREND JACKSON:  Reverend Jesse L. Jackson,
23   Sr., Rainbow PUSH Coalition.  I'll do just like
24   Bank of America, look the other way from most
 1   lights.
 2            I want to applaud the Federal Reserve
 3   Board for acceding to requests to hold these public
 4   hearings concerning the proposed acquisition of
 5   Countrywide by Bank of America.  I want to thank
 6   the Federal Reserve Board for allowing me to make
 7   these comments.
 8            These hearings will enable the public to
 9   raise questions, express concerns, and perhaps shed
10   light on the proposed merger's impact on the public
11   and consumers throughout the country.
12            But on a broader level, these hearings and
13   the practices and policies adopted by the Bank of
14   America in its proposed merger with Countrywide
15   will have a profound impact on the financial
16   services industry, millions of homeowners, and
17   indeed the entire economy which has been dragged
18   down in the back draft of the subprime sub-crime
19   mortgage crisis.
20            Ken Lewis, CEO of Bank of America is a
21   leader of distinction.  We have worked with him
22   over the years and know him to be a man of
23   integrity.
24            So we appeal to him to help lead America's
 1   families out of this crisis, and to meaningful
 2   address the compelling challenges that come with
 3   this proposed merger with Countrywide.
 4            Assets and liabilities.  The magnitude of
 5   this proposed merger is welcome documented.  Bank
 6   of America is the nation's biggest bank by market
 7   value.  The proposed acquisition of Countrywide
 8   will make it the nation's largest mortgage lender.
 9            Countrywide was once a high-flying
10   corporation, the nation's largest mortgage lender
11   and servicer, but it is now the corporate symbol of
12   all that's gone wrong with Wall Street
13   financial services firms that selfishly engage in
14   predatory and discriminatory lending practices, and
15   the steering of subprime loans to minority
16   homeowners to maximize the enormous and immediate
17   profits.
18            Countrywide is now the subject of
19   investigations and lawsuits brought by homeowners,
20   and by states attorneys' general, and Federal
21   agencies.
22            In our own state, Attorney General Madigan
23   has challenged Countrywide, they found that blacks
24   and browns making 110, 120,000 a year were steered
 1   toward subprime.  Half of those are eligible for
 2   prime.  Why aren't they steered toward prime?  This
 3   is outright thievery and thuggery.  We've found
 4   steering and we've found clustering.  That, of
 5   course, must end now.
 6            Bank of America then by acquiring
 7   Countrywide assumes its enormous liabilities,
 8   financial, legal, and moral.
 9            How will it rectify the legacy of
10   Countrywide which through its practices is
11   synonymous with the nation's home foreclosure
12   crisis?
13            It is not an overstatement to say that the
14   crisis brought on by Countrywide's of the nation
15   have put in severe jeopardy the American dream
16   homeownership.
17            The spill-over effect has wreaked havoc on
18   the budgets of states, counties, and citizens that
19   depend upon property taxes.  This has resulted in
20   profound cutbacks in social services and education
21   for the people.  California, for example, now faces
22   a $14 billion shortfall.  All of America is
23   hurting.
24            But this subprime mortgage crisis is
 1   worldwide as signalled by the Bank of England's
 2   announcement this week of a UK wide bail-out plan
 3   of England's banking industry.  No doubt the
 4   subprime mortgage crisis has caused instability in
 5   global markets.  The full impact of its implosion
 6   is still yet to be felt.  The worst is not over.
 7            Industry at a crossroads:  Leadership and
 8   a plan to remedy the crisis and offset patterns of
 9   discrimination and unfair lending practices.
10            Bank of America's proposed acquisition of
11   Countrywide stands at the crossroads of this
12   profound housing and overall economic crisis.
13            So I comment today not in support of or in
14   opposition to the proposed merger but to raise the
15   questions and seek answers as to how Bank of
16   America will address the myriad liabilities of
17   Countrywide, financial, legal, and moral, and to
18   seek clarity on how Bank of America will take
19   comprehensive steps to address the home foreclosure
20   crisis, provide some safe haven for millions of
21   Americans whose homes and communities are at risk.
22            Make no mistake about it, Bank of America
23   can provide homeowners, the nation and our economy
24   with enormous benefit if it seeks appropriate
 1   solutions to these fundamental questions and
 2   problems.

 3            But it can further derail our economy and
 4   abandon millions of homeowners if its solutions to
 5   the home foreclosure crisis it has inherited from
 6   Countrywide fall short.
 7            How Bank of America handles this
 8   Countrywide's mortgage portfolio and its
 9   liabilities is critical.  But in every crisis there
10   is opportunity, and if bold leadership and
11   comprehensive solutions are sought, Bank of America
12   has the opportunity to provide relief for millions
13   of previously harmed homeowners around the nation.
14            It has the capaciity to restore integrity
15   and credibility to the financial services industry
16   and do its part in righting the nation's economic
17   ship.
18            While Countrywide's lending practice are
19   turning America's dream into nightmares, Bank of
20   America has the challenging task of setting a new
21   path for the newly merged company.
22            Recommendations.  One, as a critical first
23   step, Rainbow Push recommends, urges Bank of
24   America to place an immediate moratorium on all
 1   home foreclosures.  We urge Bank of America to
 2   freeze existing rates and halt upward and
 3   ballooning interest rates on existing mortgages.
 4            Two, we urge Bank of America to take
 5   proactive steps to restructure loans into 30 year
 6   fixed rates at a six percent cap for homeowners.
 7            Three, a nationwide aggressive community
 8   by community outreach program must be undertaken to
 9   inform homeowners of such a moratorium, enable them
10   to take advantage of these programs.
11            Four, in that poor and minority
12   communities are most harmed by Countrywide's
13   practices and by the subprime mortgage crisis in
14   general, I would urge Bank of America to revisit
15   its commitments under the CRA, Community
16   Reinvestment Act.
17            I would recommend that a broad coalition
18   of community organizations be convened to identify
19   ways that Bank of America can fulfill it's CRA
20   commitments by enhancing positive investment in
21   poor and minority communities and stimulate their
22   economic growth.
23            Five, I wish also to open a dialogue about
24   Bank of America's internal and external policies of
 1   inclusion.  Are people of color included on the
 2   Board of Directors and highest executive leadership
 3   positions of the newly merged company?  How are
 4   minority financial services firms involved in
 5   pension and management, private equity investment
 6   and other financial matters?  How are minority
 7   professional services firms, accounting, legal and
 8   consuming involved in the merger process and in
 9   Bank of America's going operations?
10            Six, lastly, Fair Finance Watch has
11   reported data indicating that Bank of America
12   "confined African Americans to higher cost loans
13   1.88 times more frequently than whites, and denied
14   the applications of 1.62 Latinos more frequently
15   than whites.  Countrywide confined African
16   Americans to higher cost loans 1.95 times more than
17   whites, denied Latinos 1.53 times more."
18            As stated before, Countrywide is subject
19   of numerous investigations and litigation for its
20   onerous lending practices.
21            Seven, lastly, I urge Bank of America to
22   confirm if this data is accurate and if so confer
23   with community based organizations and homeowner
24   groups to identify appropriate remedies to repair
 1   the damage done.  If not, it should clarify its
 2   record.
 3            Data from a number of Federal agencies has
 4   asserted that JP Morgan Chase and other financial
 5   services firms have engaged in de facto
 6   discriminatory practices.
 7            Fair lending laws have not been adequately
 8   enforced.  It is an industry-wide problem, but now
 9   it is time to make whole those who were harmed.
10   Now is the time to repair damage done, and we
11   appeal to Bank of America in the process of this
12   merger to take the lead.
13            I urge Bank of America to fully cooperate
14   with Federal authorities, legislators and the
15   courts in providing full disclosure of
16   Countrywide's past practices and provide
17   appropriate restitution to the individuals and
18   communities harmed by these practices.
19            A clean break with Countrywide's past
20   practices we appeal.  In closing, I reiterate that
21   with the financial services industry in such
22   disarray and beset by problems it has brought upon
23   itself, Bank of America has the unique opportunity
24   to lead and set a new standard of integrity.
 1            For Bank of America's proposed acquisition
 2   of Countrywide to have integrity, Bank of America
 3   must make a clean break from Countrywide's pattern
 4   of unfair lending practices, to come clean and make
 5   whole those harmed by these practices and set a new
 6   environment with fair transparent and inclusive
 7   external and internal policies and practices.
 8            Only then can it restore the confidence
 9   and trust of our communities and the nation.  We
10   look forward to seeing and hearing how Bank of
11   America will address these issues and how its
12   proposed merger with Countrywide will provide a
13   lifelife to millions of homeowners at risk and
14   restore stability, transparency and integrity to
15   the financial services industry.
16            I thank you for your time and commitment
17   and look forward to bold leadership and
18   comprehensive initiatives from Bank of America that
19   will make its acquisition of Countrywide worthy of
20   broad support.  Thank you.
21       MS. BRAUNSTEIN:  Thank you very much.  Does the
22   panel have any questions?  Thank you very much,
23   Reverend Jackson.
24       REVEREND JACKSON:  Thank you.
 1       MS. BRAUNSTEIN:  I request for the next panel
 2   to come forward, Dory Rand, Flora johnson, Katie
 3   Coombes.
 4            Good morning.  Welcome.  As with the other
 5   panels, the time keepers are right here.  You'll
 6   see the lights go on, the green, the yellow the
 7   red, and we would -- I would recognize you and ask
 8   you to please start out your statement by stating
 9   your name and your organization.  And we can start
10   with Ms. Rand.
11       MS. RAND:  Good morning.  I'm Dory Rand, these
12   are the comments of Matthew Lee, executive director
13   of Inner City Press, Fair Finance Watch.  He cannot
14   be here today.
15            His comments are opposing the proposal by
16   Bank of America to acquire Countrywide.  While the
17   grounds include not only lending disparities, but
18   also predatory credit card practices, enabling of
19   payday lenders, presumptive violation of the 10
20   percent deposit cap, and money laundering, since
21   this is in Illinois, consider that in the first
22   study of the just released 2007 mortgage lending
23   data, Inner City Press, Fair Finance Watch has
24   identified worsening disparities by race and
 1   ethnicity in the higher cost lending of Countrywide
 2   and Bank of America, combining these two would only
 3   make things worse.
 4            In Illinois in 2007 Countrywide confined
 5   African Americans to higher cost loans 1.87 times
 6   more frequently than whites.  If combined with Bank
 7   of America and LaSalle, the disparity for African
 8   Americans grows to 1.96.  The disparity for Latinos
 9   combining Countrywide and Bank of American would
10   also increase from 1.31 to 1.36.
11            The U.S. Federal Reserve Board, while
12   still trying to avoid any public comments on or
13   review of the controversial Bear Stearns/JP Morgan
14   Chase bailout, has agreed to hold this public
15   hearing to be continued in Los Angeles April 28 and
16   29.
17            In the State of California in 2007
18   Countrywide confined African Americans to higher
19   cost loans 1.43 times more frequently than whites.
20   If combined with B of A, the disparity for African
21   Americans grows to 1.54.
22            But why no opportunity on the east coast
23   where B of A is headquartered?  In Delaware in
24   2007, Countrywide confined African Americans to
 1   higher cost loans 1.84 times more frequently than
 2   whites.  If combined with B of A the disparity for
 3   African Americans grows to 1.94.  The disparity for
 4   Latinos would also increase from 1.29 to 1.32.
 5            Nationwide hearings are needed across the
 6   nation.  B of A in 2007 confined African Americans
 7   to higher cost loans 1.88 times more frequently
 8   than whites and denied the applications of Latinos
 9   1.62 times more frequently than whites.
10            Meanwhile, Countrywide Financial confined
11   African Americans to higher cost loans 1.95 times
12   more frequently than whites and denied the
13   applications of Latinos 1.53 times more frequently
14   than whites.
15            Bank of America continues supporting
16   payday lender Advance America.  In July 2004 Bank
17   of America Corp arranged a $265 million credit line
18   for Advance America.  Documents Advance America
19   filed with the SEC indicate B of A administered the
20   credit line.  Not long after Advance America
21   announced an IPO that raised 195 million.
22            In a 2004 filing to the SEC, Advance
23   America which is the nation's largest payday lender
24   said it wouldn't be as big or successful at
 1   corralling borrowers without banks.  "We depend on
 2   loans from banks to operate our business, if banks
 3   decide to stop making loans to companies in the
 4   payday cash advance services industry, it could
 5   have a material adverse effect on our business."
 6            Also in late September 2006 B of A
 7   acknowledged that it lax operations allowed South
 8   American money launderers to illegally move
 9   3 billion through a single Midtown Manhattan
10   branch.
11            Bank of America with the Federal Reserve's
12   complicity has been making a mockery of the 10
13   percent deposit cap which is one of the few
14   consumer protections enacted along with the
15   Interstate Banking Act of 1994.
16            Bank of America is now arguing that the 10
17   percent deposit cap will not prevent its proposed
18   acquisition of Countrywide since Countrywide holds
19   it deposits in a savings and loan, but then the 10
20   percent deposit cap means nothing.  An institution
21   could just shift deposits into a savings and loan
22   and keep on buying up other institutions.
23            Countrywide's Angelo Mozilo has pocketed
24   410 million in salary bonuses and stock options
 1   gained since 1999, now he stands to cash in with
 2   severance if B of A buys Countrywide.
 3            Fox News in August 2007 said:  The press
 4   has come up, Angelo, when times are good you are a
 5   savior, now when times are bad you're a predatory
 6   lender and you pounce on unsuspecting people, what
 7   do you think of that?  Mozilo replied:  I think
 8   it's nonsense, I think it's absolute nonsense.
 9            Compare that to the testimony you heard
10   today.  Consider that Countrywide's high cost full
11   spectrum unit was called a predator even when times
12   were good.  For example, Inner City Press reported
13   in June 2007 that Countrywide Financial -- at
14   Countrywide Financial even upper income blank
15   borrowers got high cost loans 1.92 times more
16   frequently than white borrowers, and note that
17   Countrywide settled charges of its racial
18   disparities in New York in a case brought by the
19   Attorney General's office.
20            While those records are not being
21   produced, Federal Reserve should extend the comment
22   period.  For all of these reasons, Inner City Press
23   Fair Finance Watch contends the Federal Reserve

24   Board should not approve Bank of America's
 1   application.  Thank you.
 2       MS. BRAUNSTEIN:  Thank you.  Ms. Johnson.
 3       MS. JOHNSON:  Good morning.  My name is Flora
 4   Johnson.  Thank you for letting me speak today.
 5            I'm a member of Action Now.   We think the
 6   merge between Countrywide and Bank of America
 7   should not be approved until Countrywide changes
 8   how it behaves.
 9            I am here today to describe my experience
10   with Countrywide.  I work for Jewel Food Stores for
11   23 years as a cashier and front end manager.  My
12   life has been a struggle.  I have 11 children.  My
13   husband and I separated when my youngest was five
14   years old.
15            After he left he didn't provide any
16   support for the children.  I have a son with
17   cerebral palsy.  I live in a house on the south
18   side of Chicago, 97th and Normal.
19            We bought the house in 1963.  I had so
20   little money that over the years my house was sold
21   for taxes three times but I held onto the house by
22   the grace of God.
23            In 1999 I got a home equity loan.  I
24   needed the money to pay for insulation for my
 1   house, it's a frame house and it wasn't insulated.
 2            It was cold in the house, and the gas bill
 3   was so high it also reached $900 per month, and
 4   when I got the equity loan I used that to pay gas
 5   bills, get new windows and doors.
 6            The house is about to be sold again, so I
 7   used the loan money to pay the taxes.  I also used
 8   the money to fix my roof which was leaking, and I
 9   used the money to pay for care for my son with
10   cerebral palsy.
11            When I got the loan and when I signed the
12   papers, no one told me it was an adjustable loan.
13   I read the papers the best I could, but I didn't
14   see anything where it said that the mortgage was
15   going to change.
16            I didn't know it would change.  I didn't
17   have a lawyer to look at the documents.  I could
18   not afford a lawyer.
19            The loan company gave me papers to look at
20   the day before, but when I came back to sign the
21   papers, there were more papers I didn't get until I
22   signed, so that means I really didn't read those
23   papers.
24            I was desperate to get the loan, I was so
 1   far behind in my bills, my gas had already been
 2   shut off.  The home equity loan started out at 932
 3   a month.  I was able to pay that.  It was hard.
 4            Then my mortgage went up to $1,450.95 a
 5   month.  I couldn't pay that.  Countrywide sent me a
 6   payment plan, I was shocked when I got it.
 7            I called Countrywide and told the lady
 8   that I talked to I couldn't pay that.  I said to
 9   the woman, can you give me some time to pay.  She
10   said, no.  I said, well, I can't pay this.  She
11   said, I might as well start foreclosure on you now.
12            I said to the lady, it is not even due,
13   today is the 7th, and that was March, today is the
14   7th of March, it's not due till the 17th.  She
15   said, if you don't have it now, you won't have it
16   then.
17            I was terribly worried about losing my
18   house because I have a son with cerebral palsy and
19   I had fixed the house where he could get in and out
20   with a lift to lift him up, bathrooms with rods and
21   things where he could use the bathroom, and I was
22   just terribly upset, and people from Countrywide
23   called me constantly.
24            They would say when are you going to get
 1   your payment in, you are behind, which I already
 2   knew, you know you're in foreclosure.  They said I
 3   should go to my relatives and get money to pay my
 4   mortgage.  Well, I don't have that type of family
 5   that have money can pay my mortgage and their
 6   mortgage, too.
 7            Then they say, go to your church.  My
 8   church is just paying their bills, so they can't
 9   pay my mortgage.  And they never said anything
10   about making the loan affordable, they didn't do
11   anything to work things out.  They just tried to
12   squeeze every dollar out of me dragging me down to
13   the lowest level.
14            I didn't get any help until Action Now,
15   and when -- when I told Susan at Action Now that I
16   was having problems, they were going to foreclose
17   on my house, she said, well, you know, we are
18   having an action on Countrywide at their office in
19   Chicago tomorrow, would you want to join us.  I
20   said, I'll meet with bells on, I will be down
21   there.
22            So we went down to Countrywide to their
23   office.  Then Countrywide adjusted my loan to make
24   it affordable again.  They did it right away, the
 1   same day of the protest.  My mortgage was changed
 2   to a 30 year fixed rate mortgage with a much lower
 3   amount to pay each month.  But it shouldn't take
 4   protests by Action Now to get Countrywide to adjust
 5   its loans and keep people in their homes instead of
 6   going straight to foreclosure.
 7            It's this kind of behavior we want
 8   changed.  The merge between Countrywide and Bank of
 9   America shouldn't be approved unless Countrywide
10   change its practices so that Countrywide works out
11   plans to keep people in their homes and make loans
12   available, affordable instead of going straight to
13   foreclosure.  Thank you.
14       MS. BRAUNSTEIN:  Thank you.   Ms. Coombes.
15       MS. COOMBES:  Good morning.  My name is Katie
16   Coombes, national field organizer for the National
17   Training Information Center or NTIC.
18            NTIC is here today to strongly oppose the
19   proposed merger between Countrywide and Bank of
20   America.
21            Neither of these institutions should so
22   easily be rewarded.  On one hand Countrywide was
23   one of the nation's leaders in creating bad loans
24   but set up millions for foreclosure, and on the
 1   other Bank of America is a bank that has
 2   historically refused to sign meaningful Community
 3   Reinvestment Act agreements with community
 4   organizations.
 5            NTIC was cofounded in 1972 by the late
 6   Gale Cincotta.  Many of you know Gale Cincotta,
 7   mother of the Community Reinvestment Act.  NTIC
 8   remains committed to CRA and continues to work with
 9   community organizations to use CRA as a tool to
10   bring the much needed credit to our neighborhoods.
11            Although I did not have the opportunity to
12   work with Gale, I know the long history of NTIC and
13   the CRA.  Gale, in fact, was known for warning us
14   that banks were going to continue to merge, get
15   bigger, and move further away from the communities
16   they are meant to serve.
17            She also warned us all that the subprime
18   lending products were just loans that were geared
19   to rip us off and would not help people become
20   homeowners.
21            We are now seeing the dreadful impact of
22   all these loans turning into foreclosures.  We
23   asked many, many big banks to stop sticking low and
24   moderate income communities interest only 30/27 and
 1   20/28 loans that are not affordable before the
 2   foreclosure crisis started hitting the news
 3   headlines.
 4            Unfortunately they listened to corporate
 5   headquarters that were enjoying record profits on
 6   these loans and continued aggressively making these
 7   loans.  Maybe the reason banks got away with making
 8   these loans is they're located far away from local
 9   communities and are not really in touch with what
10   our needs are.
11            Certainly community credit needs are not
12   loans that borrowers cannot afford.  For example,
13   in just the first quarter of 2007, Countrywide made
14   more than $9 billion in payment option ARMs.  In
15   the same quarter Countrywide made $18 billion in
16   interest only loans.
17             Gale was also known for saying that she
18   thought once CRA was passed banks would be forced
19   to make good loans in moderate and low income
20   communities.
21            We soon found out that we had to push the
22   regulators to hold banks accountable.  We took
23   hundreds of community leaders to meet Paul Volcker
24   who was the chairman of the Federal Reserve from
 1   1979 to 1987.  Leaders from around the country
 2   persuaded Volcker that the regulators should be
 3   monitoring banks for CRA performance which they had
 4   not done to CRA in the past.
 5            He agreed, and bank monitoring happened
 6   after that.  In fact, in the 1980s NTIC held
 7   hearings throughout the country with banks,
 8   community groups and regulators about the
 9   enforcement of CRA.
10            We are forced recently to return to the
11   Federal Reserve on April 14, 2008 to demand that
12   the Fed take action just as quick to help
13   homeowners as they had taken to help Bear Sterns.
14            This Bank of America/Countrywide buyout on
15   the table today is one opportunity for the Fed to
16   hold the industry accountable.
17            I'm testifying on behalf of NTIC and
18   several of our affiliates including the Pittsburgh
19   Community Reinvestment Group which is also here
20   today and working in neighborhoods in Cincinnati
21   who have been urging banks to sign specific CRA
22   pledges to local communities.
23            Specific local commitments, not
24   immeasurable billion dollar goals which Bank of
 1   America mentioned earlier today are important as
 2   banks move forward and they move further and
 3   further from our communities.
 4            NTIC does not see any good news with the
 5   Bank of America merger and Countrywide.
 6   Countrywide has only recently started to work with
 7   homeowners and neighborhood groups to the fix bad
 8   loans they made.  We cannot say the same thing
 9   about Bank of America.  We can only hope that Bank
10   of America will reverse years of disengagement of
11   their community organizaiton.
12            The mortgage crisis with millions of
13   families losing their homes inevitably reflects on
14   the lender.  We must look carefully at how their
15   behavior has fueled the crashing and burning of
16   this industry.
17            In the current fiscal crisis that may well
18   be leading the nation into a recession, many
19   families are in danger of being put out of their
20   homes and need real help and real partners in their
21   struggles, not bigger, less responsive financial
22   entities with a dismal track record of cooperating
23   with communities.
24            Bank of America officials should step up
 1   now and pledge both to honor the commitment made by
 2   Countrywide to aid every single customer caught in
 3   the subprime mortgage mess.
 4            If Bank of America wants to demonstrate
 5   higher standards and community development they
 6   need to live up to the spirit of the Community
 7   Reinvestment Act and sign local CRA agreements.
 8            NTIC strongly opposes the proposed merger
 9   between Countrywide and Bank of America, and the
10   Federal Reserve also must live up to its duty to
11   enforce the Community Reinvestment Act and ensure
12   that banks meet community needs.
13            These mega mergers cannot be given a blank
14   check.  The only way the Fed can consider approving
15   this merger and acknowledge the credit needs of the
16   communities is to at a minimum require Bank of
17   America to stop all foreclosures on Countrywide
18   loans until they're modified into 30 year fixed
19   rates that are affordable.  Thank you.
20       MS. BRAUNSTEIN:  Thank you very much.  Any
21   questions for the panel?
22       MS. ROBINSON:  I have a question.  You said you
23   got your home equity loan in 1999 and then you
24   described the unfortunate conversations with
 1   Countrywide.  What year was that?
 2       MS. JOHNSON:  When I talked to Countrywide?
 3       MS. ROBINSON:  What you were describing as the
 4   conversations with Countrywide when you were trying
 5   to get them --
 6       MS. JOHNSON:  That was March of this year.
 7       MS. ROBINSON:  And when did they adjust the
 8   mortgage?  When did you have the protest and they
 9   finally agreed to adjust the mortgage?
10       MS. JOHNSON:  It was March of this year.
11       MS. ROBINSON:  Okay.  Same month.  Thank you.
12       MS. BRAUNSTEIN:  Anything else?  Thank you very
13   much.  Our next panel.
14            Okay.  We'll start this panel, I just now
15   want to remind everybody to -- the time keeper is
16   here, they will let you know when your time is up,
17   and also to ask that everybody clearly state their
18   name and organization at the beginning of their
19   statement, and we will -- excuse me, Bruce, are
20   you -- other people are going to speak for your
21   time?
22       MR. MARKS:  Yes.
23       MS. BRAUNSTEIN:  Since we don't have your names
24   in the record, could you make sure that you state
 1   your names clearly so we can get them for the
 2   record?
 3       MR. MARKS:  Yes.
 4       MS. BRAUNSTEIN:  Thank you.  We'll start with
 5   Mr. Sims, though.
 6       MR. SIMS:  Good morning, panel.  My name is
 7   Wallace Sims, and I'm the owner of Wally Sims
 8   Associates representing BMC Associates of Maywood,
 9   Illinois.
10            I'm here in the affirmative regarding this
11   acquisition.  As we know Countrywide has been a
12   cancer for the financial society of America.
13            Bank of America as I know it from the time
14   that it was the nation's bank became -- accepted
15   the name Bank of America on that acquisition, we
16   find that Bank of America has been vigilant in the
17   marketplace and with that competitive clean eye for
18   new opportunities in their field especially in the
19   area for African American business to business
20   relationships.
21            The good news is that this acquisition
22   opened a world of possibilities for initiatives and
23   growth.  It offers new configurations to make
24   things work.  It would define objectives that are
 1   important to the American consumers.
 2            I am convinced that Bank of America is
 3   communicating a different image to the consumer
 4   marketplace at large.
 5            Bank of America priorities and objectives
 6   would yield to the African American business to
 7   business opportunities for a greater level.  This
 8   Bank of America acquisition of Countrywide
 9   Financial has been the kind of a mortality to a
10   business that is most valuable to the American
11   populace.  It would modify, building on, expanding
12   on that which already exists.  It would give more
13   access to minority business.
14            It is simply framed together to be a
15   magnified financial institution for a growth of
16   opportunity to all consumers of the market at
17   large.
18            This will give it bigger and better
19   cornerston.  A cornerstone by definition brings two
20   walls together.  These walls usually are
21   perpendicular to one another.  Each of these walls
22   is given in different direction and has a specific
23   function.  The cornerstone joins them altogether.
24   Bank of America and Countrywide form a new and more
 1   functional economic behavior no longer two separate
 2   entities serving different purposes.
 3            This acquisition to the community at large
 4   would no longer be two separate institutions
 5   serving different purposes.  Uniting will form an
 6   entirely new structure, one which has more
 7   opportunities, strength, power, and potential than
 8   the walls held by themselves.
 9            Bank of America as the bank of opportunity
10   we believe would give what we believe to be an
11   evolutionary approach such applied to acquisitions
12   by Bank of America with knowledge.
13            They do not project the old or the new but
14   instead keep the best of both, adopting the new
15   ideas to the current methods and business
16   philosophies.
17            We believe that this acquisition to all
18   Americans alike, flexible and adaptive to
19   alternatives, we characterize Bank of America as
20   one with the reputation for trustworthiness and
21   ethical integrity, for confidential service, and
22   for this the financial structure so sound and
23   applied by Bank of America to the African American
24   business to business relationship will be
 1   multiplied, thereto we sign and endorse this
 2   acquisition.  Forget the things that are behind.
 3   Bank of America is bank of opportunities.  Thank
 4   you.
 5       MS. BRAUNSTEIN:  Thank you.  Ms. Logue.
 6       MS. LOGUE:  Thank you.  My name is Trinita
 7   Logue, and I am president of IFF formerly Illinois
 8   Facilities Fund, a certified community development
 9   financial institution working in Illinois, Iowa,
10   Missouri, and Wisconsin, and we will soon move into
11   Indiana.
12            We finance real estate for nonprofit
13   corporations located in or serving low income
14   communities such as health clinics, child care
15   centers, shoulders, food pantries, and other human
16   services.  We also provide a range of support
17   services and real estate consulting to these and
18   other nonprofits.
19            Our total assets just topped 150 million
20   and we are growing rapidly.  Almost two-thirds of
21   our loan capital comes from banks through CRA loans
22   and investments including Bank of America.
23            My organization has no direct involvement
24   in the home mortgage crisis.  As you know, as you
 1   can tell our loans are more what you would call
 2   commercial loans and we have no particular
 3   knowledge about Countrywide other than the
 4   information available in both industry and popular
 5   press.
 6            I believe, however, that it is important
 7   that Bank of America should acquire Countrywide and
 8   manage the crisis that has been caused by
 9   Countrywide and others and has the potential to
10   bring financial ruin to so many individuals and
11   families.
12            We are concerned, however, that the
13   magnitude of this crisis will distract Bank of
14   America from many other priorities including
15   building a better relationship with the Chicago
16   metro area community which is an important priority
17   due to its recent acquisition of LaSalle Bank.
18            As you know, LaSalle Bank's commitment to
19   corporate civic leadership and community
20   involvement was visible and tangible in many ways.
21            Bank of America has very quickly moved
22   toward not only continuing but increasing this
23   commitment, however, the bank is only at the very
24   beginning of this effort and has a long way to go.
 1            We look forward to working with Bank of
 2   America as it reaches a higher level of commitment
 3   and sustains it over time, but it is not an
 4   either/or situation.
 5            Bank of America has the responsibility to
 6   manage many economic and social priorities, at the
 7   same time to acquire Countrywide with all its
 8   problems and the ongoing investigations of its
 9   practices and also to transform its role in this
10   community to one that reflects its size and the
11   size complexity and needs of the Chicago metro area
12   market.
13            There is no silver lining for the many
14   individuals and families who have or will lose
15   their homes.
16            Responsibility must be shared by many, but
17   we all know that Bank of America is among the giant
18   institutions that must shoulder a large share of
19   the burden to make sure that the terrible lessons
20   translate into real progress rather than fear of
21   community lending.
22            They share this responsibility because of
23   their size and their history.  The CDFI industry
24   can benefit we all know from greater assistance and
 1   attention as we, too, take bold steps to gain
 2   access to the capital markets for community
 3   development investments.
 4            Bank of America has the ability to help us
 5   strengthen bridges with mainstream financial
 6   markets and to do it in a way that eliminates any
 7   chance of the type of crisis we now have with
 8   subprime mortgages.
 9            To reduce uncertainty around community
10   development investments, the CDFI industry needs
11   help in finding ways for appropriate risks and
12   pricing models to be developed that will take us to
13   the capital markets on a consistent basis.
14            Capital providers such as Bank of America
15   can lead the effort to strengthen working
16   relationships with the CDFI industry to develop a
17   richer understanding of our activities.
18            I'm confident that the expertise found at
19   Bank of America coupled with the community
20   development finance industry can move the industry
21   in the right direction to increase capital to low
22   and moderate income communities and individuals
23   with appropriate oversight and leadership.
24            We have seen Bank of America moving in
 1   this direction in Chicago and we urge that this
 2   continue and grow.
 3            Just as increased transparency will be
 4   required if Bank of America acquires Countrywide,
 5   accountability is the most important component of
 6   success in all CRA activities, particularly with
 7   these global institutions.
 8            I recommend that together we establish new
 9   models for community accountability as one of many
10   changes that emerge from this crisis.  Thank you.
11       MS. BRAUNSTEIN:  Thank you very much.
12   Mr. Marks.
13       MR. MARKS:  Hello.  My name is Bruce Marks, I'm
14   the CEO of the Neighborhood Assistance
15   Corporation America.
16            Before I talk -- I want to talk about
17   solutions today, so before I do that, if I can
18   ask -- we have a lot of people here who have -- who
19   have mortgages and are at risk of foreclosures, so
20   if I can ask the people to stand up who have an at
21   risk mortgage and are at risk of foreclosure.
22            So, everybody, thank you for coming.  So
23   what you see, clearly there's huge numbers out
24   there of people across the board, hard working
 1   people who are at risk of foreclosure through no
 2   fault of their own because they have a mortgage
 3   that was structured to fail.
 4            Let's talk about solutions.  Through the
 5   NACA program, we have $10 billion that has been
 6   committed that provides the best mortgage
 7   opportunity for people -- hard working people who
 8   in the industry -- who the industry considers to be
 9   subprime borrowers, but when you provide a prime
10   loan, meaning a loan that requires no down payment,
11   requires no closing costs, that does not require
12   perfect credit but has a 30 year fixed term, one
13   percent below market, and today's rate is 5.25
14   percent, what happens to those borrowers, they
15   become prime borrowers, and that's the reality.
16            We have destroyed the myth that you have
17   to compensate for someone's low credit score or
18   someone's lack of assets by providing an
19   unaffordable subprime or predatory loan, and the
20   biggest partner that we have in that agreement is
21   Bank of America, so that's on the purchase side.
22            On the home save side, people who are at
23   risk of foreclosure, we have an agreement with not
24   just Countrywide but with others, but the biggest
 1   one is with Countrywide where they will restructure
 2   loans based on what the homeowner can afford.  That
 3   means that you look at someone's net income,
 4   required liability payments, required monthly
 5   expenses, you back into a mortgage payment that
 6   that homeowner can afford over the long term.
 7            And we've done a lot of those loans out
 8   there, and this applies not just -- this applies to
 9   all of the Countrywide mortgages that they service.
10            So now we're able to go back and we're
11   able to make those loans affordable and over the
12   long term because the agreement says that they will
13   restructure those over a 30 year fixed rate.
14            So there are solutions out there.  The key
15   is to make those solutions not just through NACA,
16   but to make those the standard, and that's what we
17   hope and we expect the Bank of America acquisition
18   of Countrywide to do.
19            But I want to turn over the remaining time
20   that I have to two -- to two very special people
21   who -- one on my left, Carmen, she -- just not for
22   me saying we provide the best home ownership for
23   working people, Carmen can say it in her own words.
24   Carmen.
 1       MS. BROOKS:  Hi.  My name is Carmen, and it is
 2   true, I closed about three weeks ago, I didn't
 3   have -- there was no down payment, no closing cost,
 4   no prepayment penalty, and they provided me with an
 5   attorney, and my interest rate was 4.75 percent,
 6   and I purchased a home for 150,000 in Joliet,
 7   Illinois.
 8       MR. MARKS:  And if I can turn it over to
 9   Fernando who on the home save side, Fernando had a
10   Countrywide mortgage, and also Nancy is going to
11   translate.
12       THE INTERPRETER:  Hello, my name is Nancy, and
13   I'm a bilingual housing counselor for the NACA
14   program.
15            Fernando is one of our members that had a
16   negative and balloon mortgage with Countrywide that
17   would adjust to 115 percent of the original
18   principle.
19            He took out a $300,000 mortgage and his
20   payment was over $3200, and it was restructured to
21   a fixed rate loan at a fixed rate interest rate,
22   and I'm also Fernando's translator.
23       MR. AVILLA:  Hello.  My name is Fernando
24   Avilla.  He always had his mortgage with
 1   Countrywide and we have it now.
 2            Since he's been into the program, his
 3   interest rate now is 3.50 fixed for the remaining
 4   term of the loan, and his mortgage payment went
 5   from $3200 to $2100 including escrow and made it
 6   affordable for him to keep his home.
 7       MR. MARKS:  Is there anything else you want to
 8   say?
 9       MR. AVILLA:  He has tried to look for other
10   solutions through other banks and through other
11   brokers and he went to visit five other banks and
12   brokers before he came to NACA.
13            And it wasn't through an ad -- and through
14   something that was published in a newspaper, he
15   came in, knew about the organization that provided
16   solutions for the homeowners.  Thank you.
17       MS. BRAUNSTEIN:  Thank you very much.
18       MR. MARKS:  So what I would like to end with is
19   there is these solutions out there both on the
20   purchase side so you can really make -- to
21   transform how lending can get done going forward
22   and on the home save side.
23            So the two players that we're talking
24   about today have provided those real solutions out
 1   there in a comprehensive way, now we got to make
 2   that the national standard.  Thank you very much.
 3       MS. BRAUNSTEIN:  Okay.  Thank you.  The panels
 4   have questions.  Alicia.
 5       MS. WILLIAMS:  Yes.  Can you tell me how long
 6   the agreement has been in place with the B of A and
 7   also how many people you have helped?
 8       MR. MARKS:  B of A on the purchase side, that's
 9   been in place since 1995, and tens and tens of
10   thousands of homeowners have gone through the
11   program, and our performance is the best in the
12   country both prime and subprime.
13            So we have shown that when you provide a
14   prime loan to what the industry considers a
15   subprime borrower, they become a prime borrower and
16   perform better than any other program out there.
17       MS. WILLIAMS:  So do you have like numbers for
18   2006 and 7 at this point that you can share?
19       MR. MARKS:  I don't have it on the top of my
20   head, but one of things that was clear is that we
21   have lost a lot of business, a lot of loans over
22   the last four years because a lot of lenders out
23   there were saying they were going to qualify people
24   for $100,000 more than what we knew they could
 1   afford.
 2            They would have an initial interest rate
 3   which was even lower than a 30 year fixed, one
 4   percent below market, and the fact of the matter
 5   is, you know, people went to those major
 6   institutions, we did not compromise our standards,
 7   they're out of business, we're growing.
 8            We have 38 offices around the country,
 9   we'll be doubling in size this year, and we've
10   become the national standard on both the purchase
11   side and on the home save side.
12       MS. BRAUNSTEIN:  Any questions?  Okay.  Thank
13   you very much to this panel.  Next panel is
14   Heddy Ratner, Debbie Dixon, and Raul Raymundo.
15            All right.  Just once again to state that
16   our time keepers are here, the green light, yellow
17   light means two minutes, and then red light stop,
18   and also just to remind you again, please state
19   your name and your organization at the beginning of
20   your statement.   And we'll start with Ms. Ratner.
21       MS. RATNER:  I'm Heddy Ratner, I'm co-president
22   of the Women's Business Development Center, and I
23   thank you for the opportunity to support and
24   endorse Bank of America's acquisition of
 1   Countrywide and on Bank of America's commitment to
 2   economic opportunity issues to assist minority and
 3   women, small business community of the Chicago
 4   metropolitan area, as well on Bank of America's
 5   support of community development and its leadership
 6   on economic development and their commitment to the
 7   letter and the spirit of community reinvestment.
 8            My organization, Women's Business
 9   Development Center, and in collaboration with other
10   minority business organizations represent thousands
11   of women and minority business owners in the
12   Chicagoland area.
13            Our organization is involved in Bank of
14   America's continuing investment into low and
15   moderate income families, businesses, and
16   neighborhoods, and specifically in its efforts to
17   provide access to credit in those communities.
18            The Women's Business Development Center
19   has had positive firsthand experience with Bank of
20   America and its previous incarnations since the
21   inception of our organization founded in 1985.
22            The WBDC provides counseling,
23   entrepreneurial training, financial assistance,
24   business and strategic planning, marketing,
 1   procurement assistance, and assistance with loans
 2   to startup, emerging, and maturing businesses.
 3            Our organization is now the oldest and
 4   largest and the most comprehensive women's business
 5   assistance center in the United States.  Bank of
 6   America has been our partner since 1988 in economic
 7   and community development providing support for our
 8   organization and its programs, loans to our
 9   clients, participation as a lender in our women's
10   business bank loan program, and participation in
11   our annual entrepreneurial women's conference since
12   1991.
13            Several years ago the Women's Business
14   Development Center and Bank of America began a
15   wonderful partnership to provide business
16   development, financial assistance to low and
17   moderate income Hispanic communities.
18            WBDC with the support of Bank of America
19   is making our successful child care and business
20   assistance programs available in English and
21   Spanish.
22            These innovative new business programs
23   bring information and services, counseling and
24   entrepreneurial training, credit advice and
 1   counseling, financial assistance as well as
 2   self-employment opportunities through economically
 3   disadvantaged communities.  In 2001 I was honored
 4   to be the recipient of the Bank of America
 5   community leadership award.
 6            In 2006 and 2007 Bank of America asked me
 7   to help select honorees in neighborhood excellence.
 8   Bank of America continues to be in leadership
 9   development with high school students with
10   scholarships for college for deserving students and
11   to nonprofit leaders who have gone above and beyond
12   to public service.
13            Also in 2007 Bank of America was the host
14   and sponsor of a Women of Color Forum in
15   conjunction with the Women's Business Development
16   Center and Center for Women's Business Research.
17            Our recommendations are we look to the
18   merger of these two major institutions to increase
19   their commitment to community and economic
20   development and to diversity and leadership in
21   employment policies and in the procurement and
22   purchasing practices of the bank.
23            Small business lending and low and
24   moderate income communities and loans to minority
 1   and women owned businesses would be enhanced with
 2   the collection of gender and race based lender data
 3   that has been available for housing through HMVA
 4   and has not been available for small business.
 5            We propose that Bank of America would
 6   voluntarily collect gender and race based
 7   information to help develop the most successful
 8   policies and programs to enhance the growth of
 9   small business lending as well as mortgages in our
10   communities.
11            We look to Bank of America to be the
12   precedence center and lead national efforts in
13   changing Regulation B.
14            This is a timely window of opportunity.
15   Although our organization and hundreds of community
16   economic development organizations agree that the
17   requirements of gender and race based commercial
18   lending date is necessary for policy and program
19   development, we would like to see the participation
20   of major banks in this effort as well.
21            We at the Women's Business Development
22   Center support the merger of Bank of America with
23   Countrywide.  Thank you for the opportunity to
24   present today.
 1       MS. BRAUNSTEIN:  Thank you.  Ms. Dixon.
 2       MS. DIXON:  Yes.  My name is Debbie Dixon, and
 3   I'm the associate director of Neighborhood Housing
 4   Services of Chicago.
 5            First I would like to also say thank you
 6   for the opportunity to share these comments with
 7   this panel and members of this hearing.
 8            Neighborhood Housing Services of Chicago
 9   is a nonprofit housing organization with more than
10   30 years experience in creating and preserving home
11   ownership in the City of Chicago.
12            Since 1975 NHS has served 164,000 clients,
13   invested 388 million in Chicago neighborhoods, and
14   created 3,000 new homeowners and counting.
15            Bank of America is a 20 year partner of
16   NHS on community reinvestment initiatives in
17   Chicago.
18            One of the ways Bank of America currently
19   partners with NHS is by investing in NHS's hundred
20   million dollar loan pool.  This source of funds
21   enables NHS to make home purchase improvement and
22   refinance loans available to low and moderate
23   borrowers at affordable fixed rates.
24            By making credit available this way, Bank
 1   of America creates significant investment in
 2   Chicago's low and moderate income neighborhoods.
 3   Bank of America's staff also provides personal
 4   leadership to NHS in our efforts to create and
 5   maintain sustainable home ownership.
 6            For example, B of A president, David
 7   Rudis, serves as co-chair of the NHS trustee
 8   committee, and then with that, senior vice
 9   president is an active long-time member of the NHS
10   Board of Directors and currently serves as
11   secretary.
12            NHS appreciates the time and expertise
13   these industry leaders provide to our work.  An
14   assessment of Bank of America's acquisition of
15   Countrywide must take into consideration Bank of
16   America's sizeable capacity and enthusiastic
17   willingness to respond to the foreclosure issue
18   through significant loss mitigation efforts.
19            Bank of America has demonstrated that its
20   loss mitigation staff can move cases forward in a
21   timely manner and can offer meaningful option to
22   borrowers.
23            Furthermore, NHS believes that Bank of
24   America would integrate Countrywide's business into
 1   a corporate culture that favors responsiveness to
 2   trouble homeowners.
 3            And, finally, Bank of America has a track
 4   record for testing innovative solutions to the
 5   foreclosure problem.
 6            Bank of America's long standing commitment
 7   to community development issues and investment in
 8   the foreclosure work of nonprofits such as NHS
 9   makes B of A a strong candidate to acquire
10   Countrywide.
11            NHS believes Bank of America will provide
12   Countrywide with the stability, financial
13   resources, and access to a network of institutions
14   committed to community reinvestment.
15            These hearings place important attention
16   on the needs of our communities and specifically
17   the resources they need to be successful.  Thank
18   you for this opportunity to testify.
19       MS. BRAUNSTEIN:  Thank you very much.
20   Ms. Reyes.
21       MS. REYES:  Good morning.  My name is Guacolda

22   Reyes.  I'm the deputy director of The Resurrection
23   Project.
24            The Resurrection Project is a
 1   non-for-profit, 17 years all non-for-profit working
 2   on the communities of Pilsen, Little Village, and
 3   Back of the Yards in Chicago producing affordable
 4   rental housing and also promoting home ownership.
 5            I appreciate this opportunity to provide
 6   comments to the Board of Governors of the Federal
 7   Reserve regarding Bank of America's proposal to
 8   acquire Countrywide Financial Corporation.
 9            As the deputy director of The Resurrection
10   Project, we would like to express our support to
11   this recent announcement, and it is our belief that
12   it would provide much needed stability to our
13   troubled housing market and to many communities
14   feeling the devastating impact of escalating
15   foreclosure rates.
16            Since 1990 The Resurrection Project has
17   been working to create healthy communities by
18   building and preserving affordable housing.  Our
19   work in Chicago's growing Latino population has
20   produced hundreds of homeowners and leveraged over
21   151 million in community reinvestment.
22            And now today with foreclosure rates at an
23   all time high and projected to continue to
24   increase, the work that we have done over the years
 1   to build wealth and create asset for our families
 2   is being threatened.
 3            Today, as you all know, the demand for
 4   foreclosure counseling has increased dramatically
 5   and more and more homeowners find themselves in
 6   danger of losing their homes.
 7            Left alone with no intervention from Bank
 8   of America, Countrywide is very likely to go
 9   bankrupt resulting in a scenario that would further
10   undermine the mortgage industry and the confidence
11   of families in buying homes that we still seeing
12   coming through our doors.
13            In supporting Bank of America's
14   acquisition of Countrywide, we would like to see
15   Bank of America put forward a plan for any
16   Countrywide mortgage holders at risk of
17   foreclosure.  This means to create real sustainable
18   solutions for families that allow them to stay in
19   their homes for long term.
20            I'm working primarily in partnership with
21   HUD certified counseling agencies such as ours and
22   many others probably in this room.
23            Furthermore as a result of its acquisition
24   of Countrywide, Bank of America will become the
 1   nation's mortgage lender leader and hence it should
 2   be proactive in creating again sustainable credit
 3   worthy and affordable mortgages for working
 4   families.
 5            For many communities like ours
 6   experiencing record high rates of foreclosures this
 7   is critical to be addressed.  Thank you again for
 8   this opportunity.
 9       MS. BRAUNSTEIN:  Thank you very much.
10   Questions from the panel?  Okay.  Then thank you
11   very much.
12            At this point we're going to take a
13   fifteen minute break and we will reconvene at
14   twenty after.
15                      (Short break.)
16       MS. BRAUNSTEIN:  We're reconvening, please.
17   Okay.  We're going to start with our next panel.
18   And do we have everybody here?  Okay.
19            We have our time keepers there, please
20   keep an eye out for the time keeper, and please
21   state your name and your organization at the
22   beginning of your statement, and we'll start with
23   Ms. Donoghue.
24       MS. DONOGHUE:  Thank you for having me on the
 1   panel today.  I am Mary Donoghue, housing counselor
 2   at the North Side Community Federal Credit Union.
 3            Our credit union serves the low and
 4   moderate income population in northeast Chicago
 5   with traditional banking services and products
 6   specifically designed for this population such as
 7   our payday alternative loans, our New American
 8   loans and our housing counseling program.
 9            We began our housing counseling program a
10   year and a half ago.  What began as a program aimed
11   at helping low and moderate income renters become
12   homeowners has quickly turned into a largely
13   foreclosure intervention counseling program.
14            As a counselor I meet with clients one on
15   one, assess their hardship and ability to repay a
16   mortgage and then assist homeowners by negotiating
17   a loan modification or forbearance -- or repayment
18   plan with their servicer.
19            Of my clients facing foreclosure,
20   45 percent of them have loans that adjusted within
21   the first three years.  Many of these clients
22   simply need a fixed loan at a competitive rate to
23   be able to stay in their homes.
24            As the foreclosure crisis worsens, housing
 1   counseling agencies see banks responding with more
 2   willingness to provide loan modifications.  This is
 3   a good sign.
 4            I'm here today to ask that if Bank of
 5   America acquires Countrywide Financial, it will
 6   agree to increase the number of staff in its loss
 7   mitigation department, retrain current Countrywide
 8   foreclosure counseling staff and formally commit to
 9   work with counseling agencies to find solutions for
10   homeowners facing foreclosure.
11            Countrywide is notorious among housing
12   counselors as the worse servicer to work with in
13   the industry.
14            I would like to tell you a story about one
15   particular case.  My client, we'll call her Susan,
16   is typical of the North Side Credit Union member.
17   She lives on the south side of Chicago, and she
18   commutes to the north side for work.
19            One day last November she called the
20   credit union to get a loan.  It turn out she wanted
21   a loan in order to pay the upfront costs associated
22   with the prepayment plan that Countrywide had
23   recently sent her.
24            Our loan officer referred her to the
 1   housing counseling program instead.  Susan
 2   purchased her home fourteen years ago with her
 3   husband.  With both incomes they could afford the
 4   mortgage.
 5            When they got a divorce, Susan could no
 6   longer afford the payments on her own.  She fell
 7   behind, and she did what she thought was the only
 8   option for saving her home, she filed for
 9   Chapter 13 bankruptcy.
10            During the bankruptcy she moved into a
11   cheaper rental unit and found a tenant to live in
12   her home to help pay the mortgage.  When the
13   bankruptcy was discharged she was dealt another
14   blow, her tenant stopped paying the rent, and
15   although Susan tried to work things out, she ended
16   up evicting the tenant.
17            She lost over $8,000 in the process.  At
18   this point Susan moved back in and tried to set up
19   a repayment plan with Countrywide to get back on
20   track.
21            When I met her she was already eight
22   months behind on her mortgage.  Right away we began
23   calling Countrywide.  It took more than ten calls
24   and numerous e-mails over three days to finally get
 1   in touch with the helpful customer service
 2   representative.  I told this representative that
 3   every time I called the workout negotiator's
 4   extension I was transferred to a customer service
 5   representative rather than the negotiator's
 6   voicemail.
 7            This representative informed me that
 8   Countrywide had gotten rid of voicemail for workout
 9   negotiators.  I mentioned to her that I never
10   received replies to my e-mails.  The representative
11   told me that although the workout negotiators can
12   read the e-mails I send them, they cannot respond
13   to them.
14            Therefore as an advocate working on behalf
15   of my client I have an incredibly difficult time
16   reaching the very negotiator with whom I need to
17   speak.  In Susan's case she could have avoided a
18   repayment plan if we had been able to reach the
19   negotiator quickly.
20            It took one month, however, to reach the
21   actual workout negotiator working on her case and
22   another month before Countrywide was able to
23   produce a new payment plan.  As these months
24   passed, however, a payment plan ceased to be an
 1   option.
 2            Susan's budget could handle repaying eight
 3   missed payments over 36 months but not ten missed
 4   payments.  We moved to the loan modification
 5   department, and once again encountered a negotiator
 6   who did not answer the phone, have voicemail, or
 7   reply to e-mails.
 8            Again we communicated in a convoluted
 9   manner where we both left messages with a customer
10   service representative.  This surprisingly did
11   result in a loan modification, yet under no
12   circumstances should this process take three to
13   four months to complete.
14            Both my client and Countrywide would be
15   better served if a loss mitigation solution could
16   have been negotiated in a more efficient manner,
17   therefore, I have two recommendations for Bank of
18   America should it acquire Countrywide Financial.
19            No. 1, Bank of America should hire and
20   train an adequate staff to provide loss mitigation
21   solutions for delinquent borrowers.
22            Bank of America should retrain Countrywide
23   loss mitigation staff to work by a much higher
24   standard.
 1            In addition Bank of America should hire
 2   and train new staff to meet the increasing demand
 3   for loss mitigation solutions.  This includes
 4   efficiently moving customers through the various
 5   workout options to find the best solution for each
 6   case.
 7            In particular, if clients have adjustable
 8   rate mortgages, they need to be fast tracked to a
 9   loan modification and skip the possibility of a
10   repayment plan.
11            No. 2, Bank of America should provide
12   training for housing counselors covering its loss
13   mitigation procedures.
14            This training should allow HUD housing
15   counselors to personally meet with workout
16   negotiators in loss mitigation department.
17            It is vital that counselors establish
18   these contacts so that together we can quickly find
19   solutions for delinquent borrowers.  Thank you.
20       MS. BRAUNSTEIN:  Thank you very much.
21   Ms. Rand.
22       MS. RAND:  Good morning.  I'm Dory Rand,
23   supervising attorney for community investment at
24   the Sargent Shriver National Center on Poverty Law.
 1            Shriver Center is a national law and
 2   policy center that takes action to end poverty
 3   through policy development, communications,
 4   advocacy, and litigation.
 5            As part of our national agenda, we
 6   champion civil rights and racial justice,
 7   preservation of affordable housing, and building
 8   and protecting assets for financial stability and
 9   growth.
10            We neither support nor oppose the proposed
11   acquisition but we do have serious concerns about
12   the potential negative impact of the proposed
13   acquisition on the growing racial wealth gap
14   dwindling affordable housing stock and precarious
15   state of consumer protection.
16            My comments focus on Bank of America's CRA
17   performance and the effect of the acquisition on
18   resources and Countrywide's predatory lending
19   practices and Bank of America's response.
20            I want to acknowledge that I have
21   benefited in the past from receipt of a Bank of
22   America grant.  I'm aware that B of A has made
23   substantial grants to many nonprofits in Chicago
24   and throughout the country, and I hope that such
 1   grants will continue and increase in the future.
 2            The most recent CRA exam for B of A was
 3   based on the time period ending in December of
 4   2001.  How can the Federal regulators provide
 5   meaningful oversight of one of the largest banks in
 6   the country with such outdated information?
 7            The CRA exam does not include, for
 8   example, the fact that B of A is banking the
 9   largest payday lender in the country, Advance
10   America, thereby facilitating the trapping of
11   millions of consumers and endless cycles of death.
12            The Shriver Center recommends more
13   frequent CRA exams and more detailed data
14   collection including loan modification data,
15   information on the affordability of its retail
16   products and services, and information on the
17   impact of its support of payday lending on
18   borrowers.
19            The Shriver Center supports the
20   recommendations of Woodstock and CRA coalition
21   calling for ongoing meetings between B of A and
22   community groups to monitor and discuss progress on
23   community reinvestment, mortgage lending, and
24   retail services.
 1            B of A's recent acquisitions of Fleet
 2   Boston and LaSalle Bank resulted in elimination of
 3   thousands of jobs.  According to the Boston Globe,
 4   B of A eliminated over 16,000 jobs after it
 5   acquired Fleet outsourcing many of them overseas.
 6            According to American Banker, LaSalle
 7   acquisition will result in elimination of 4,000
 8   jobs including 2500 in Illinois.
 9            The Shriver Center is concerned that if
10   B of A follows through with elimination of 4,000
11   LaSalle jobs and more at Countrywide it will not
12   have sufficient resources to address the problems
13   caused by Countrywide's predatory lending and other
14   community concerns.
15            We support North Side and Woodstock and
16   others calls for maintaining adequate staffing and
17   training including multilingual and culturally
18   competent staff.
19            Countrywide has a record across the
20   country for making high risk, high cost loans and
21   for creating significant disparities by race.
22            According to the FFI June 1, 2007 report,
23   for Countrywide home loans, the affiliate in
24   Chicago, African Americans were 1.81 times more
 1   likely than were whites in Chicago to receive high
 2   cost loans.
 3            The Shriver Center is concerned that the
 4   Federal regulators have paid insufficient attention
 5   to these racial disparities which reflect
 6   violations of our neighbor's civil rights.
 7            The unfair pricing of loans in our
 8   communities of color exacerbate the already
 9   significant racial wealth gap, decreases the supply
10   of affordable housing, and threatens to prolong
11   cycles of intergenerational poverty.
12            For example, in yesterday's Crain's
13   Chicago Business section on the foreclosure
14   fallout, Juan Rivera of Lucha said for Latino and
15   African American families, the equity would have
16   been used to send their kids to college or to start
17   businesses in the community, now that equity is
18   completely lost.
19            Bank of America must take aggressive steps
20   to competently handle the fallout from Countrywide
21   and B of A's high cost loans including extensive
22   community outreach, loan modifications to
23   affordable 30 year fixed rate loans, adequate
24   multilingual staffing for loan modifications and
 1   significant funding and training of nonprofit and
 2   bank staff to assist with homeowner counseling.
 3            Bank of America must be held accountable
 4   for the lending practices of Countrywide that are
 5   under investigation by the attorney general of
 6   Illinois and other states.
 7            In addition, we support the Chicago Rehab
 8   Network's recommendations on steps needed to
 9   preserve affordable rental housing.
10            Thank you for the opportunity to make
11   these comments.
12       MS. BRAUNSTEIN:  Thank you very much,
13   Ms. Rand.  Mr. Feltner.
14       MR. FELTNER:  Good morning.  My name is Tom
15   Feltner, I'm the policy and communications director
16   of the Chicago based Woodstock Institute, a
17   research and policy development organization and a
18   convener of the Chicago CRA coalition, an
19   association of community organizations working to
20   increase community reinvestment activity in the
21   Chicago metropolitan region.
22            This acquisition raises several concerns
23   which Woodstock feels must be adequately addressed
24   before the merger is approved by the Federal
 1   Reserve Board which I respectfully request that the
 2   Federal Reserve Board require Bank of America to
 3   have a public action plan in place and rigorously
 4   examine the ability of that plan to resolve the
 5   following issues before approving the acquisition.
 6            No. 1, Bank of America must have a public
 7   action plan in place to aggressively modify problem
 8   Countrywide loans into 30 year fixed rate loans;
 9            Discussions with housing counselors in the
10   Chicago region have indicated that for many
11   Countrywide borrowers, a modification to a fixed
12   rate 30 year loan would represent the best chance
13   to avoid default and foreclosure.
14            In addition reports showed as many as one
15   in three Countrywide borrowers were improperly
16   placed into subprime loans despite credit scores or
17   other factors that would have qualified them for
18   lower cost prime mortgage loans.
19            An aggressive loan modification strategy
20   targeted to borrowers who currently or potentially
21   may have problems affording their mortgages would
22   best serve both the interest of the borrowers and
23   the bank.
24            No. 2, Bank of America must commit to
 1   ongoing meetings between senior bank staff and
 2   community groups to monitor and discuss progress
 3   and provide data on loan modifications, community
 4   reinvestment, mortgage lending, and retail
 5   services.
 6            No. 3, Bank of America must maintain
 7   existing staffing levels dedicated to identifying
 8   problem borrowers and working with them to stay in
 9   their homes.
10            In the past Bank of America has taken
11   steps to cut costs immediately after a merger has
12   been approved including the dramatic reduction of
13   staff at the acquired institution.
14            If Bank of America is expected to absorb a
15   significant amount of problem mortgages after the
16   acquisition of Countrywide, multilingual staff must
17   be in place to implement a meaningful foreclosure
18   prevention strategy.
19            Evidence from one local housing counselor
20   in the Chicago region has shown that while
21   Countrywide mortgages make up about 7 percent of
22   the regional market, Countrywide counseling cases
23   make up about 20 to 25 percent of their overall
24   case load.  A dramatic reduction in staff is
 1   certain to exacerbate this program.
 2            Bank of America should be accountable for
 3   Countrywide's lending practices particularly those
 4   currently under investigation.  Countrywide's
 5   lending practices have come under the intense
 6   scrutiny of the Illinois Attorney General for
 7   alleged racial steering and other discriminatory
 8   practices.
 9            Countrywide is also under investigation by
10   the U.S. Trustee for improperly handling mortgage
11   payments, charging unwarranted fees and improperly
12   calculating escrow.
13            Recognizing that Countrywide has a
14   considerable number of pending investigations, Bank
15   of America must be accountable for Countrywide's
16   violations and proactively work with the incoming
17   members of Countrywide's management to eliminate
18   the causes of these violations.
19            Woodstock Institute and the CRA coalition
20   look forward to learning more about Bank of
21   America's long-term plan to help Countrywide
22   borrowers in distress and address these four
23   concerns.
24       MS. BRAUNSTEIN:  Thank you very much.
 1   Mr. Jackson.
 2       MR. JACKSON:  Thank you, and welcome to
 3   Chicago.  My name is Kevin Jackson, I'm with the
 4   Chicago Rehab Network.
 5            The network is a coalition of over 30, 40
 6   organizations for 30 years, all nonprofits
 7   committed to affordable housing either as advocacy
 8   organizations or as the community development
 9   corporations in this city, and together they have
10   been responsible for over 10,000 units of rental
11   housing production.
12            As Chicago's leading coalition of
13   nonprofit community development corporations, we
14   are interested in sharing the best opportunity for
15   the people and communities throughout metro Chicago
16   who require affordable housing.
17            Bank of America's leadership in lending
18   and investment will be measured in large part by
19   their actions related to the foreclosure crisis and
20   the directly related need for affordable rental
21   housing.
22            Let me provide a quick snapshot.  We just
23   released a fact book update for what happened
24   between 2000 and 2005 as well as between 2005,
 1   2006.  What you've seen is that 2000 incomes across
 2   Chicago as -- across the country was at the highest
 3   ever.  In five years, the decrease was ten percent
 4   in income to whereas the housing cost in Chicago
 5   increased by over 65 percent for detach for sale.
 6            At that same five-year period we lost
 7   71,000 units of rental housing.  In the year 2008
 8   January, we lost a thousand homeowners to
 9   foreclosure in the City of Chicago, and in February
10   it was approaching 1700 before the month was done.
11            So what we have is a collision happening
12   in terms of people being moved out of one housing
13   type into another at the very time when losing that
14   housing.
15            I mentioned the 71,000 number, it was from
16   2000 to 2005.  In 2005 to 2006, the census status
17   shows us another 10,000 came off line of rental
18   housing units.
19            2000 to 2005, to put it in perspective,
20   that's over 12 percent of the rental stock for this
21   city, 600 percent increase in the City of Chicago
22   alone and people paying over $2,000 in mortgages.
23            So I'll continue with my testifying, I'm
24   going to not try to repeat everything because we're
 1   in agreement with what you've heard here with my
 2   fellow panelists.
 3            Bank of America's pending merger with
 4   Countrywide could either benefit hundreds of
 5   thousands or further decimate their financial
 6   future.
 7            In acquiring Countrywide, Bank of America
 8   will become responsible for more than $9 million
 9   new customers.  Many of these customers are faced
10   with the threat of foreclosure.
11            We are concerned about Bank of America's
12   plan to purchase the troubled Countrywide because
13   Countrywide's unbridled business practices and
14   lowered mortgage lending standards paved the way
15   for this crisis.
16            Bank of America not only stands to acquire
17   the largest mortgage lender and servicer in this
18   nation but numerous lawsuits and default mortgages
19   as well.
20            Given the leadership of Bank of America,
21   we are concerned that Countrywide's bad lending
22   practices are ruining the dreams of thousands, Bank
23   of America has the opportunity to rebuild them.
24            In particular, as the people have
 1   mentioned, the Rehab Network's biggest concern is
 2   going to be on rental housing stock.  We will
 3   detail actions that can remedy households in
 4   foreclosure.
 5            But many households will need to enter the
 6   rental market, and for that reason we ask that Bank
 7   of America create a product line to meet the needs
 8   of Chicago's rental portfolio which has been
 9   mid-sized loans.
10            On the Federally assisted portfolio, we
11   need Bank of America's leadership in providing
12   financing to multi-layered financing deals where
13   housing assistant payment contracts are involved.
14            Any policies which exclude these projects
15   from access to loan products are policies which
16   work against the national, local tide of efforts to
17   preserve existing affordable rental stock.
18            In fact, I would like to underscore the
19   need for innovative loan products for rental with
20   particular attention and favorable rates for rental
21   preservation.
22            In summary, we recommend that Bank of
23   America create a product line to meet the needs of
24   Chicago's rental portfolio which has been mid-sized
 1   loans;.
 2            Initiate a system to transfer bank owned
 3   properties in Illinois to municipalities and/or
 4   non-profit developers who can rehab, recycle homes
 5   into habitable affordable uses;
 6            Initiate an immediate foreclosure
 7   moratorium on all mortgage loans in Bank of America
 8   and Countywide's portfolios including those that
 9   are currently being serviced;
10            Modify loans for borrowers in danger of
11   losing their homes to a fixed interest rate of no
12   more than six percent for 30 years;
13            Meet semiannually with the Chicago CRA
14   coalition and senior Back of America community
15   reinvestment mortgage lending and retail staff to
16   evaluate investment impacts and explore product
17   adjustments and maintain or increase the level of
18   philanthropic giving to the community involvement
19   field.
20            Bank of America has the opportunity to
21   rebuild the broken dreams of Countrywide borrowers,
22   your leadership on this important issue is needed
23   now more than ever.
24            Thank you for your attention and support
 1   with this important issue.
 2       MS. BRAUNSTEIN:  Thank you very much.  Any
 3   questions for the panel?
 4       MS. WILLIAMS:  Dory, you talked a little bit
 5   about more loan collection data, so could you tell
 6   me what you were thinking in that regard?
 7       MS. RAND:  I believe I mentioned more data on
 8   loan modification so that we can see how Bank of
 9   America is handling these refinancing into
10   hopefully 30 year fixed mortgages of the predatory
11   Countrywide loans.
12       MS. WILLIAMS:  Okay.  And so what specifically
13   would you like them to report out in that regard?
14       MS. RAND:  There's a number of things they
15   could include in terms of the number of loans
16   modified, the terms of the loans, how quickly they
17   were modified after receiving a request for a
18   modification, racial, gender breakdowns in terms of
19   how the loans were modified to see if they're being
20   done on a fair basis.  Other panelists have other
21   suggestions.
22       MR. FELTNER:  I think it's also important to
23   recognize there are lots of different types of
24   modifications.
 1            Obviously we're more concerned with
 2   modifications that reduce the principal, that
 3   reduce the interest rates rather than modifications
 4   that would recapitalize interest or simply extend
 5   the repayment plan.
 6       MS. WILLIAMS:  Thank you.
 7       MS. BRAUNSTEIN:  Thank you very much.  Will the
 8   next panel come forward, please?  That would be
 9   Michael Shea, Peter Gagliardi, Lee Beaulac, and
10   Judy Kennedy.
11            Just a reminder to the panel, the time
12   keeper is right there, and you'll see the little
13   box with the lights on it, and also please start
14   your statement, please, with your name and your
15   organization.  And we'll start with Michael Shea.
16       MR. SHEA:  Good afternoon.  Thanks for the
17   opportunity to be here.  My name is Michael Shea,
18   I'm executive director of ACORN Housing.
19            I'm speaking on behalf of the members of
20   the community group ACORN as well as ACORN Housing
21   Corporation.
22            ACORN Housing has had a partnership with
23   Bank of America for sixteen years.  During that
24   time our partnership has produced over 100,000
 1   first time home buyers.  It's resulted in very
 2   innovative underwriting for first time home buyers.
 3            We're here to support the merger of Bank
 4   of America of Countrywide because we've seen over
 5   the last sixteen years Bank of America's
 6   willingness to provide a leadership role in making
 7   affordable mortgage credit available to low and
 8   moderate income communities and people of color.
 9            It's a long history we have with B of A
10   that we're proud of.  Bank in 1991, 1992 after the
11   last great credit crunch we faced after the savings
12   and loans went bust, Bank of America stepped
13   forward and made billions of dollars in commitments
14   to low and moderate income lending.  To get out
15   they adopted many of the available underwriting
16   features even though it meant that they have the
17   portfolio of those loans which they did for
18   decades.
19            In the mid 1900s -- I'm sorry, the mid
20   1990s when the Republicans in Congress were
21   attempting to eliminate the Community Reinvestment
22   Act, Bank of America was the only major lender that
23   came to Congress to speak at congressional
24   hearings, sat at a panel with community members in
 1   support of strengthening the Community Reinvestment
 2   Act.
 3            Back in the early part of this decade when
 4   the subprime lending crisis was starting to
 5   explode, Bank of America sat down with ACORN
 6   Housing, other community groups, listened to us as
 7   we told them about the abuses that were taking
 8   place through their subprime mortgage lender,
 9   Nations Credit.
10            They went back, they did some analysis,
11   and as a result Bank of America exited completely
12   the subprime lending market, left it to the others
13   that saw the quick money, and as a result Bank of
14   America did much better in recent years than those
15   other lenders.
16            And then recently executives from Bank of
17   America have come forward and have suggested that
18   the only way we're going to be getting out of this
19   crisis that we're currently in is if the government
20   steps in, buys large packages of mortgages so that
21   they can be restructured in a way that would allow
22   them to be affordable to the homeowners that are
23   theirs so the homeowners can be saved.
24            Bank of America has also recenly stepped
 1   forward and provided millions of dollars of funding
 2   to housing counseling agencies who are attempting
 3   to work with people to save their homes even though
 4   Bank of America did not make those loans that were
 5   abusive and are leading the foreclosures.
 6            I wish I could say that the kind of
 7   leadership that Bank of America has provided over
 8   the last few years was duplicated -- over the last
 9   sixteen years is duplicated by the Federal Reserve.
10            But the fact is the Federal Reserve more
11   than anybody has been asleep at the switch.  We're
12   in this crisis currently because the Federal
13   Reserve failed to regulate, failed to listen, and
14   with the exception of the great late Ed Gramlich
15   didn't do anything to try to curb predatory
16   lending, that's why we're in the mess we are
17   currently.
18            It's our great desire that the Federal
19   Reserve take steps to find a moral compass as we
20   move forward to force loan servicers to do long
21   term loan modifications to save people's homes.
22   Thank you.
23       MS. BRAUNSTEIN:  Thank you.  Mr. Gagliardi.
24       MR. GAGLIARDI:  Good morning.  My name is Peter
 1   Gagliardi, and I've served as the executive
 2   director of HAP, Inc., a regional nonprofit housing
 3   agency based in Springfield, Massachusetts for the
 4   past 17 years.
 5            Prior to that I served for four years on
 6   the staff of the Massachusetts Executive Office of
 7   Communities for Development, and that service
 8   followed 13 years and a number of positions at
 9   Rural Housing Improvement, Inc., in Winchendon,
10   Massachusetts.
11            Currently I'm serving on the Board of
12   Directors of the Housing Partnership Network, the
13   Massachusetts Housing Investment Corporation, the
14   Massachusetts Nonprofit Housing Association, and
15   National Rural Housing Coalition.
16            And recently I was honored to be appointed
17   to the Massachusetts Home Mortgage Finance Agency
18   Advisory Committe by Governor Deval Patrick.
19            We're a regional nonprofit housing
20   partnership serving 43 cities and towns in Hampton
21   and Hampshire counties in Massachusetts, a region
22   encompassing all of the Springfield, Massachusetts
23   metropolitan area.
24            We've been in business for some 35 years
 1   and have a staff of about 100 people, and we
 2   operate a wide variety of housing programs
 3   including those that educate first time home
 4   buyers.
 5            We recently received a grant from the
 6   Massachusetts Division of Banks to create and
 7   operate the Western Massachusetts Foreclosure
 8   Prevention Center, a collaboration of 15 nonprofit
 9   and municipal entities.
10            The City of Springfield alone had more
11   than 1,000 foreclosure options in 2007.  If you're
12   from Detroit that may not sound like a lot, but
13   Springfield is not a huge city, and that's a
14   disaster.  This is nearly four times the level of
15   2005, and the number appears to be climbing much
16   higher in 2008.
17            And we're still in the process of
18   repairing the damage done by a wave of foreclosures
19   in the 1990s.  We're inundated now with yet another
20   wave.  And on this morning's walk, the young lady
21   in the green hat from Action Now told me just how
22   serious the problem is here in Chicago, and I took
23   note of that.
24            One of our major lines of business is home
 1   ownership education and counseling.  Bank of
 2   America has consistently been our leading private
 3   sector partner in this initiative.
 4            Its predecessor Fleet Bank was
 5   instrumental in launching our home ownership effort
 6   nearly 15 years ago, and that partnership continues
 7   today.  This does include Bank of America financial
 8   support of our home ownership counseling and
 9   education.
10            As a consequence of our partnership with
11   the bank, more than 8700 people from our region
12   have completed our accredited first time home buyer
13   education program.
14            Those who have been education and
15   counseled are less likely to be victims in the type
16   of lending that has led to the current foreclosure
17   crisis, and our anecdotal data from working with
18   people facing foreclosures confirms that.
19            Bank of America has been a leading lender
20   this program statewide and has provided a wide
21   variety of mortgage products that have served the
22   need of our program gradually.
23            We've established over the past 15 years
24   that Bank of America as well as other regulated
 1   lenders have successfully served the low and
 2   moderate income and minority households of our
 3   region providing appropriate products that allow
 4   our home buyers to succeed.
 5            It's our belief that Bank of America's
 6   stewardship of Countrywide will bring the bank's
 7   understanding of positive community impact to this
 8   major lender further adding to the resources
 9   available to low and moderate income communities.
10            We expect that this will enhance our
11   partnership with Bank of America leading to
12   responsible lending that will benefit low and
13   moderate income families and communities in our
14   service area.
15            We support Bank of America's acquisition
16   of Countrywide Financial Corporation.  Thank you.
17       MS. BRAUNSTEIN:  Thank you.  Mr. Beaulac.
18       MR. BEAULAC:  Good morning.  My name is Lee
19   Beaulac, I'm the senior vice president with
20   community and economic development at Rural
21   Opportunities, ROI.
22            ROI is based in Rochester.  We're a 38
23   year old organization, non-for-profit community
24   development corporation providing services to farm
 1   workers and to other low and moderate income people
 2   across seven different states and Puerto Rico, and
 3   we deploy our services and capital through 74 local
 4   offices throughout that region.
 5            ROI has developed or preserved over 10,000
 6   units of affordable housing valued at over half a
 7   billion dollars.  Our CDFI, The Enterprise Center
 8   has helped placed over $60 million in small and
 9   micro business financing and 350 small and micro
10   business enterprises.
11            I am a member of the Bank of America's
12   National Community Advisory Council, I also serve
13   on the executive committee of the National Rural
14   Housing Coalition, and I'm the current chair of the
15   Board of Directors of the National Community
16   Reinvestment Coalition in Washington.
17            To begin I want to express my appreciation
18   to the Federal Reserve Bank for having made a
19   decision to hold these hearings.
20            It's clear to us that many changes in the
21   American finance system have been allowed to take
22   place without the benefit of careful and thoughtful
23   analysis and discussion and that the impact of some
24   of these changes on local communities have not been
 1   adequately considered.
 2            It is critically important to America's
 3   communities that the Federal Reserve Bank carry out
 4   its mandate, and I think the words are to assess
 5   the convenience and needs of the communities to be
 6   served by institutions proposing to merge or
 7   acquire other financial institutions.
 8            Today, however, I'm speaking on behalf of
 9   ROI.  From our perspective as an organization
10   that's focused a great deal of attention on rural
11   economic development, we generally oppose banking
12   mergers and a consolidation in the lending
13   industry.
14            In our view rural communities are usually
15   better served by local financial institutions which
16   have employees who are more in tuned with those
17   rural communities and better able to meet the
18   credit needs.
19            Also from our perspective, consolidation
20   of the banking industry has reduced competition in
21   the market and has often disrupted the flow of
22   credit and capital to certain local business
23   sectors, particularly natural resource based
24   industries like timber and agriculture and other
 1   agriculturally related enterprises.
 2            However, to their great credit, Bank of
 3   America has realized the degree to which this is a
 4   problem for small business lending, and they have
 5   begun a rural initiative designed to give credit
 6   needs in smaller markets, and to that end they have
 7   made substantial donations to, and have made a very
 8   large program related investment in my organization
 9   so that we can in turn make small business loans
10   and offer small business management training to
11   businesses in rural Upstate New York.
12            Bank of America has also supported the
13   development of regionally based e-commerce programs
14   which have helped hundreds small and micro business
15   ventures move from their very limited local and
16   seasonal retail sales possibility to the global
17   marketplace through Internet commerce.
18            In the case of this particular merger,
19   however, the institution that is being acquired is
20   not a local rural institution.  Countrywide was the
21   largest mortgage lender in the U.S. -- is the
22   largest mortgage lender in the U.S., and a major
23   player in a very negative effort to focus subprime
24   lending in communities that have fewer prime
 1   options just like urban areas.
 2            While majority neighborhoods in major
 3   urban areas of our country have received most of
 4   the attention and discussion about subprime lending
 5   because of the concentrated damage foreclosures are
 6   causing in those communities, we are also aware
 7   that residents of rural communities also have
 8   limited options when looking for housing credit as
 9   well as small business credit.
10            We hope that as part of this merger
11   process, the Federal Reserve will encourage, and
12   the Bank of America will agree, not only to refrain
13   from this kind of targeted subprime lending but
14   that they will also agree to target and market
15   heavily high qualify fixed rate prime loans toward
16   the communities that had been targeted for so much
17   harmful lending in the past.
18            Many people who were once eligible for
19   prime loan products but were targeted by companies
20   that aggressively marketed toxic products in our
21   communities are in need of rescue and repair.
22            As one of the United States' largest
23   banks -- largest bank, buying America's largest
24   mortgage lender, Bank of America has unique
 1   resources and unique ability to make this happen.
 2            Like many of my colleagues, I welcome the
 3   opportunity that this acquisition presents to us.
 4   Those of us working at the community level are fed
 5   up and frankly angry beyond words that as a nation
 6   we have allowed the Countrywides of the world to
 7   perpetuate the deceptive practices, the bait and
 8   switch, and all the other type of bad behaviors
 9   that have wrought havoc to our communities.
10            We welcome the notion that the Bank of
11   America will have an opportunity to impose its
12   culture opinion that of Countrywide and help
13   eliminate the toxic practices that has ravished our
14   communities.
15            In conclusion, we urge Bank of America to
16   commit to doing everything possible to make whole
17   the thousands of families that have been hurt by
18   Countrywide.
19            This would include those folks who are now
20   in default and should have their loans modified as
21   well as those who were victimized by any of
22   Countrywide's predatory practices.
23            I would urge the Bank of America to
24   appoint appropriate level staff to work with
 1   consumer advocates and attorneys to begin
 2   immediately restructure loans for homeowners who
 3   are defrauded by Countrywide.
 4            And, finally, Bank of America should
 5   adhere to a set of principles of all future home
 6   mortgage lending that will take into account what
 7   consumer groups consider to be good lending
 8   practices including but not limited to the
 9   exclusion of prepayment penalties, the exclusion of
10   mandatory arbitration, and the exclusion of lending
11   without regard and ability to repay.  Thank you.
12       MS. BRAUNSTEIN:  Thank you very much.
13   Ms. Kennedy.
14       MS. KENNEDY:  My name is Judy Kennedy.  I
15   represent the National Association of Affordable
16   Housing Lenders, America's leaders in lending
17   private capital to those in need, some 200
18   organizations committed to increasing the private
19   capital lending and investing in low and moderate
20   income communities, some of whom are testifying
21   today, members of the who's who of private sector
22   lenders and investors in affordable housing and
23   community and economic development.
24            Our very experienced practitioners of
 1   community investment have learned the hard way that
 2   making private capital available in underserved
 3   areas is only part of the job.
 4            Building communities is not only about
 5   providing capital and bricks and mortar, it also
 6   involved mastering regulations about complex
 7   initiatives like the New Markets Tax Credit,
 8   educating policy makers about the partnerships
 9   between banks and local nonprofits to meet
10   communities needs, helping to preserve needed
11   Federal community and economic development programs
12   through advocacy, policy analysis, and just plain
13   persistence.
14            As always, the devil is in the details of
15   Federal regulations and only the most committed
16   community investment practitioners dedicate the
17   resources necessary to master those details and
18   advocate for policies that advance affordable
19   housing and community economic development.
20            Bank of America directly on its own and
21   through now consistently provides the necessary
22   resources.  Let me share just a few examples.
23            Bank of America has tackled the most
24   complex redevelopment involving often conflicting
 1   regulations, work through Federal, state, and local
 2   requirements.  Nothing about this work in
 3   communities is easy or glamorous, and most of it
 4   goes unnoticed.  Woody Allen is credited with
 5   saying that 80 percent of success is "just showing
 6   up."

 7            Bank of America consistently shows up
 8   whenever policy makers and other practitioners need
 9   more knowledge or experience of practical solutions
10   to spur more private capital lending and investing
11   in underserved areas.
12            For example, partnering with NAAHL and
13   other advocacy organizations, Bank of America
14   worked persistently in Congress to helpe create the
15   innovative New Market Tax Credit to preserve the
16   community development's financial institution's
17   fund, then the Community Development Block Grant
18   Program, then the Section 8 files and voucher
19   program, made time for staff briefing, legislative
20   proposals.
21            In a Republican majority Congress, having
22   a major bank play such an important advocacy role
23   is very significant.
24            Even after the laws are signed, the
 1   regulations, for example, Internal Revenue Service,
 2   are often as big a problem.  The Internal Revenue
 3   Service had written rules that would have made the
 4   New Markets Tax Credit virtually useless.
 5            Bank of America once again provided the
 6   professionals necessary to help educate the authors
 7   of tax rules on how to fix their proposed
 8   regulation consistent not only with existing tax
 9   policy but also with real live community
10   development.
11            Not long ago -- well, some years ago NAAHL
12   in support of Ed Gramlich's effort and because of
13   advocacy by the late great Gale Cincotta held the
14   first of two practical solutions to predatory
15   lending symposia.
16            We wrote the book, we wrote it twice, we
17   got virtually little or no attention.  Without Bank
18   of America's support we could not have promulgated
19   those reports.
20            When HUD proposed eliminating the Hope 6
21   program that revitalized so many communities, Bank
22   of America again showed up to testify and supported
23   proposing the program -- I'm sorry, of preserving
24   the program and worked behind the scenes countless
 1   hours in collegial ways with Congressional staff on
 2   ways to make it more efficient.
 3            Bank of America has also brought to the
 4   Federal policy arena its experience from a very
 5   unique partnership with Public Housing Authorities
 6   across our nation.
 7            The bank provides both private capital
 8   financing, technical assistance, and just plain
 9   moral support on private sector business methods
10   that increase the Public Housing Authority's
11   operational efficiencies.
12            When other insured institutions or policy
13   makers are looking for innovative ways to help
14   bring unbanked individuals into the financial
15   mainstream, Bank of America always respond.
16            The bank's Sesame Street for adults video
17   that helps to break the ice of financial literacy
18   training sessions is much in demand as are its
19   customer documents and languages like Farsi and
20   Bosnian.
21            When California lending institutions
22   couldn't figure out the New Markets Tax Credit and
23   had applied it and never succeeded in getting an
24   allocation, Bank of America was willing to send
 1   people out on a Federal holiday, a bank holiday to
 2   spend the day helping the banks to see the
 3   possibilities for their communities.
 4            So throughout the country communities are
 5   benefiting from Bank of America leadership,
 6   knowledge, experience, and advocacy.  We support
 7   the proposed acquisition.
 8       MS. BRAUNSTEIN:  Thank you very much.  Any
 9   questions for the panel?  Thank you.  Thanks to the
10   panel.
11            Our next panel can come forward.  Just to
12   remind the panelists that our time keeper is right
13   there with the box with the lights on it, and
14   please state your name and organization at the
15   beginning of your statements.  And we'll start with
16   Ms. Van Valkenberg.
17       MS. VAN VALKENBERG:  Good morning.  My name is
18   Katrina Van Valkenberg, and I'm the director of the
19   Illinois program of the Corporation for Supportive
20   Housing.
21            I would like to speak a little bit about
22   Bank of America's partnership with our organization
23   and the work we're doing in Illinois.
24            Our office in Illinois is part of a larger
 1   national nonprofit organization that has a mission
 2   of helping communities create permanent housing
 3   with services to help prevent and end homelessness
 4   for communities.
 5            We do this through three ways.  We do it
 6   through project specific assistance where we do
 7   predevelopment and acquisition lending to help
 8   nonprofit organizations develop permanent
 9   supportive housing, and some supportive housing
10   really for people who are homeless and disabled and
11   people who are typically at 30 percent and below
12   AMI, often 15 percent and below AMI.
13            We also do this through capacity building
14   to help nonprofit organizations develop their
15   capacity to develop and operate this type of
16   housing, and also through policy work to try and
17   make it simpler to kind of streamline the funding
18   systems to make this type of housing possible for
19   people.
20            Our office has been open since 1992 and
21   Bank of America has been a funding partner for our
22   office helping make our work possible since 1996.
23            In addition to general operating support
24   making it possible for us to do this work, Bank of
 1   America also investments loan funds that we're able
 2   to use.
 3            We have currently a $500,000 loan pool
 4   that we're able to use for predevelopment loans and
 5   acquisition loans.  And again these loans go to
 6   projects that are really serving folks who are
 7   homeless and disabled at 30 percent AMI, and to
 8   nonprofits we're developing this very kind of
 9   mission based permanent supportive housing.
10            We -- since '92 we've invested about 13.7
11   million in these projects overall.  The loan pool
12   we have from B of A has been a revolving loan pool,
13   we've been able to put in different projects over
14   time.
15            We've developed just under 2500 units of
16   permanent supportive housing in Illinois, and we
17   have just under 2,000 right now in our pipeline of
18   projects moving forward, and we've done about $5.8
19   million in capacity building in service and
20   employment grants to nonprofit organizations.
21            Bank of America has been really an
22   important partner for us in this work in their
23   investment in our ability to our staff time to be
24   able to do the work and in the ability to give us
 1   funds that we're able to lend to nonprofits to make
 2   their work possibe.
 3            So we're very thankful for their
 4   commitment to community development and to
 5   nonprofits in Illinois and really to serving folks
 6   at this really low income level, people are
 7   30 percent below area median income and people who
 8   are homeless.  Thank you.
 9       MS. BRAUNSTEIN:  Thank you very much.
10   reverend Schrey.
11       REVEREND SCHREY:  Good morning and thank you.
12   I'm Christine Schrey.  I'm a member of the Board of
13   Directors of the Northwest Side Housing Center and
14   pastor of Christ Lutheran Church here on the
15   northwest side of Chicago.
16            The Housing Center started five years ago
17   in response to predatory lending and foreclosures
18   ravaging our neighborhoods.
19            Our mission is to preserve the stability
20   of our community and to help people stay in their
21   homes.  From housing counseling to senior services
22   and community organizing, the housing center is all
23   about preserving the northwest side today and for
24   generations to come.
 1            Our community knows the foreclosure crisis
 2   all too well with approximately 1700 foreclosures
 3   started in 2007.  Many days our phone rings off the
 4   hook with people in jeopardy of losing their homes.
 5   We respond by negotiating with their lender or
 6   servicer for permanently affordable solutions.
 7            Our local partnership with Bank of America
 8   is strong and encouraging, as a result of their
 9   support we are this month able to greatly increase
10   our staff capacity to provide foreclosure
11   prevention counseling to help more families stay in
12   their homes.
13            Our experience with Bank of America in the
14   last twelve months has been a positive one, and we
15   appreciate their commitment to addressing the
16   foreclosure crisis.
17            On the other hand, our experience with
18   Countrywide has been abysmal.  It is characterized
19   by little to no communication, unwillingness to
20   develop workout solutions in the best interest of
21   homeowners and the community, an absolute refusal
22   to live up to its public statements regarding
23   foreclosure prevention.
24            Take the story of Ms. J, a single woman
 1   living on the northwest side of Chicago who
 2   experienced a permanent loss of income, we
 3   repeatedly tried to contact Countrywide to develop
 4   workout solutions that would buy Ms. J some time to
 5   get back on her feet and sell her home.
 6            Short sale options were not answered, and
 7   in the end nearly 18 months after opening the case
 8   Countrywide did accept a short sale, 18 months of
 9   pure agony in which Countrywide refused to
10   communicate, refused other offers, and refused to
11   do anything to assist Ms. J.
12            In our experience Countrywide does not
13   return calls.  How does a loss mitigation
14   department that is supposed to be responsive to its
15   customers not return calls?
16            Also despite rhetoric to the contrary,
17   Countrywide is deplorable at communicating with
18   housing counselors.
19            Homeowners seek us out to serve as their
20   partner and advocate in navigating the very complex
21   and time consuming web of the mortgage industry.
22   Instead of returning our calls with proposed
23   resolution, Countrywide contacts the homeowner
24   themselves and pressures them to accept new terms
 1   or workouts that may, in fact, not be in their best
 2   interest and certainly does not allow them the time
 3   to consult with their housing counselor.
 4            This practice also cuts the housing
 5   counselor out of the picture and limits our ability
 6   to secure a resolution that is best for the
 7   homeowner and best for the community.
 8            We are hopeful that Bank of America will
 9   serve Countrywide customers better than
10   Countrywide.  Considering that Countrywide is the
11   worse in the industry, hopefully the situation can
12   only improve.
13            But what happens to Countrywide customers
14   right now?  They languish in a loss mitigation and
15   collections operation that does nothing to assist
16   them in getting into long-term affordability
17   through permanent modifications.
18            Countrywide stands to gain from this
19   merger and that is unacceptable considering the
20   damage they have done in communities across the
21   country.
22            It is well reported that Countrywide CEO
23   Angelo Mozilo will make 112 million off the sale to
24   Bank of America, and add that to his already half
 1   of a billion dollar war chest, the only ethical
 2   thing to do is to take Mr. Mozilo's profits and use
 3   it to assist the very homeowners Countrywide has
 4   worked to destroy.
 5            We can't wait for the purchase of
 6   Countrywide by Bank of America to be complete
 7   before Countrywide customers can get meaningful
 8   resolutions.
 9            Countrywide must serve their customers now
10   and get serious about working to keep people in
11   their homes.  Thank you.
12       MS. BRAUNSTEIN:  Thank you very much.
13   miss Hibbs.
14       MS. HIBBS:  Good morning.  My name is Maria
15   Hibbs, and I'm the executive director of the
16   Partnership for New Communities.
17            Although I'm not in a position to offer
18   insight into the financial merits of Bank of
19   America proposed acquisition of Countrywide
20   Financial, I am pleased to be with you today to
21   provide testimony regarding the bank's commitment
22   to the community which if this acquisition is
23   successful offers a real opportunity to repair the
24   damage that Countrywide has inflicted on borrowers
 1   and communities.
 2            First some background about The
 3   Partnership For New Communities.  The partnership
 4   is a collaborative of Chicago business and civic
 5   leaders supporting the city's massive fifteen year
 6   effort to transform public housing.
 7            Mayor Daley and the Chicago Housing
 8   Authority launched the plan for transformation in
 9   1999 with a goal of constructing or rehabilitating
10   25,000 units of public housing.
11            More than 7,500 of those homes are being
12   built within new mixed income settings replacing
13   primarily gallery style high-rises which had become
14   emblematic of failed urban housing policy.
15            In fact, the census tracks in which those
16   high-rises stood had some of the highest
17   concentrations of poverty in this country, and this
18   investment over the decades left those
19   neighborhoods with few businesses including decent
20   grocery stores.
21            So in addition to improving housing, the
22   plan is knitting isolated communities of despair
23   back into the fabric of the city, revitalizing
24   entire neighborhoods in the process.
 1            Realizing that government alone could not
 2   affect change at the scale and complexity
 3   envisioned in the plan for transformation, leaders
 4   from business, philanthropy, government academia
 5   and the faith community created the partnership in
 6   2003 as a vehicle for private sector support of the
 7   plan, and Bank of America has been with us from the
 8   start.
 9            Bank of America's top leadership has been
10   a committed partner in our work.  When Terry
11   Perucca, the former president of Bank of America
12   Illinois was asked to join the partnership's
13   advisory committee which is our governing board he
14   eagerly agreed and has been a highly involved
15   member ever since.
16            We value his participation as well as the
17   relationships we've belt with many other Bank of
18   America leaders in community development,
19   commercial banking lending and the Bank of America
20   foundation.
21            The foundation has contributed more than
22   $1.5 million in support of the partnership's
23   efforts to strengthen the economic infrastructure
24   of our communities of focus by attracting
 1   commercial development.
 2            The Bank of America foundation support is
 3   also enhancing employment opportunities for public
 4   housing residents through a major work force
 5   development initiative called Opportunity Chicago.
 6            I am pleased to report that over the past
 7   two years more than 2,700 of the city's public
 8   housing residents, many facing formidable barriers
 9   to employment have participated in Opportunity
10   Chicago programs and have found work.
11            These are meaningful civic and
12   philanthropic investments in the plan for
13   transformation.
14            And on the business side Bank of America
15   is providing $128 million in financing for the
16   redevelopment of four public housing sites into
17   mixed income communities under the plan.  These are
18   extremely complex multi-layered financial
19   transactions.
20            When completed, those four sites will
21   provide 4,800 homes for low and moderate income
22   Chicagoans.
23            Given the current financial turmoil in the
24   housing market, I would urge Bank of America to
 1   exercise its leadership to encourage the
 2   construction and preservation of affordable housing
 3   and to put an end to lending practices so
 4   aggressively pushed by Countrywide that have led to
 5   the rising numbers of foreclosures in so many
 6   communities.
 7            To these ends we look forward to
 8   continuing our partnership with Bank of America in
 9   revitalizing Chicago's neighborhoods and creating
10   opportunity for the people who call them home.
11   Thank you for listening.
12       MS. BRAUNSTEIN:  Thank you very much.
13   Mr. Gamboa.
14       MR. GAMBOA:  Yes.  Good morning.  My name is
15   Hector Gamboa, I'm with the Spanish Coalition for
16   Housing.  I'm the program development manager.
17            I have a short brief statement.  The
18   current mortgage situation has continued to
19   increase the number of foreclosures in our
20   communities as well as across the city and the
21   nation.
22            The current foreclosure crisis requires a
23   more rapid and proactive response from lender
24   servicers than what we have been experiencing from
 1   Countrywide in the past few years, that is the
 2   reason the Spanish Coalition for Housing supports
 3   the proposed Bank of America acquisition of
 4   Countrywide.
 5            The Spanish Coalition is one of the
 6   leading HUD certified counseling agencies helping
 7   Latino families with their housing needs in the
 8   greater Chicago area.  Bank of America has worked
 9   closely with the Spanish Coalition to address the
10   needs of the families that we serve.
11            These times present us with challenge to
12   recommit our resources and efforts to work
13   tirelessly to assist homeowners in or at risk of
14   foreclosure.
15            Helping one homeowner prevent a
16   foreclosure can benefit the entire neighborhood.
17   Although Spanish Coalition for Housing staff works
18   diligently to navigate workouts for homeowners one
19   at a time, we need a more broad based wider
20   reaching solution to prevent foreclosures and keep
21   families in their homes.
22            We need to redouble our efforts to impress
23   upon Bank of America and our legislators to pass
24   initiatives that offer broader government
 1   intervention which provide immediate assistance
 2   directly to homeowners at risk of losing their
 3   home.
 4            We are confident and hopeful that this
 5   acquisition improve the accountability, and with
 6   Bank of America will help to better address the
 7   needs of Latinos and other low to moderate income
 8   families.
 9            The accessibility of Bank of America to
10   those in need of foreclosure prevention services
11   will increase the number of mutually beneficial
12   workouts and effectively address the growing number
13   of at risk mortgages throughout the Chicago area.
14            The Joint Economic Committee of the U.S.
15   Congress estimated that over the next two years the
16   nation will experience a loss of $71 billion in
17   home equity as a result of the foreclosure crisis.
18            In previous years, Spanish Coalition's
19   partnership with Bank of America has increased the
20   number of new homeowners and has contributed to
21   building wealth and stabilizing our local
22   communities.
23            Community lending programs are part of the
24   solution and were never part of the problem that
 1   caused the mortgage meltdown.
 2            Spanish Coalition looks forward to
 3   continue to work with Bank of America to regain
 4   some of those losses and implement new efforts to
 5   increase home ownership opportunities and avoid
 6   foreclosures.  Thank you.
 7       MS. BRAUNSTEIN:  Thank you very much.  Any
 8   questions?  Thank you very much, and we'll call the
 9   next panel forward.
10            Welcome, and just as a reminder to the
11   panel that the time keeper is there with the
12   lights, and also to please state your name and
13   organization at the beginning of your statement.
14            And, Ms. van Kerkhove, I understand you're
15   reading Rashmi Rangan's statement?
16       MS. VAN KERKHOVE:  Yes, I am.
17       MS. BRAUNSTEIN:  Okay.  We'll start with you,
18   and I guess why don't you do your own first and
19   then Rashmi -- or it doesn't matter, whichever way
20   you want to do it.
21       MS. VAN KERKHOVE:  Where is the time keeper?
22       MS. BRAUNSTEIN:  Oh, I'm sorry, the time keeper
23   is right there.
24            There's a box, there will be a green
 1   light, and then the yellow light will go on when
 2   you have two minutes left, and then the red light
 3   when it's time to stop.
 4       MS. VAN KERKHOVE:  So I have a total of five,
 5   correct?
 6       MS. BRAUNSTEIN:  Right.  But since you're doing
 7   two, obviously you get five for each.
 8       MS. VAN KERKHOVE:  Okay.  I'll do mine first.
 9   Hi, my name is Barb van Kerkhove, and I'm a
10   researcher of policy analyst at the Rochester, New
11   York office of the Empire Justice Center, a civil
12   legal services law firm.
13            As part of my work, I co-convene the
14   Greater Rochester Community Reinvestment Coalition,
15   a coalition of over 30 locally based
16   not-for-profits and individuals.  The Bank of
17   America application touches millions of consumers'
18   lives.
19            Millions of people throughout the country
20   and thousands in the Rochester, New York area have
21   some type of relationship with either Bank of
22   America or Countrywide.
23            Bank of America is the seventh largest
24   depository in the Rochester, New York area with
 1   almost 537 million on deposit in 24 branches.
 2            In 2006 Countrywide was the fifth largest
 3   mortgage lender in the Rochester area originating
 4   over 1500 loans, and Bank of America was the tenth
 5   largest mortgage lender originating over 900
 6   mortgage loans.
 7            This is sort of in the context of today's
 8   foreclosure crisis which today, despite what some
 9   conservative pundits say was not caused by the
10   Community Reinvestment Act, this foreclosure crisis
11   is the result of unfair and deceptive practices of
12   mortgage brokers and unregulated mortgage bankers
13   as well as the relaxed underwriting of lenders, and
14   this uncludes Countrywide.
15            Client stories and our written comments
16   show that the Countrywide customers who were either
17   subject to predatory practices or unable to get
18   Countrywide to work with them at all or in a timely
19   manner to avoid foreclosure.  So we need to act to
20   preserve the investments that all of us here today
21   made in our communities.
22            Current Federal actions are not addressing
23   the problem.  This merger presents the board with a
24   unique opportunity to signal clearly to banks that
 1   they must take innovative measures to keep
 2   homeowners in their homes and preserve our
 3   communities, therefore, if the Federal Reserve
 4   attaches certain specific conditions to Bank of
 5   America's acquisition of Countrywide Financial, the
 6   Greater Rochester Community Reinvestment Coalition
 7   will not oppose the acquisition.
 8            As a condition of the merger, the Federal
 9   Reserve must require Bank of America to first
10   conduct fair lending reviews of Countrywide clients
11   and make them whole where they have been
12   discriminated against because of their race or
13   ethnicity.
14            Second, restructure or modify Countrywide
15   loans with interest rate freezes and principle
16   reductions as needed to keep homeowners in their
17   homes for the long term.
18            Third, vastly improve the response time in
19   handling calls on Countrywide originated and
20   serviced loans.
21            Fourth, work with consumer advocates to
22   restructure into fixed rate prime loans homeowners
23   who were defrauded into ARMS or other unaffordable
24   loans.  This includes requiring Bank of America to
 1   assign management level staff to be direct contacts
 2   for housing advocates and attorneys who can
 3   facilitate timely and meaningful resolutions.
 4            Fifth, respond promptly to borrowers and
 5   ensure timely workouts prior to referring client
 6   files to foreclosure attorneys.
 7            Six, streamline short sales and deeds in
 8   lieu of foreclosure for homeowners unable to be
 9   saved through loan restrucures.
10            Abide by a set of principles on all future
11   loans including no prepayment penalties, no
12   mandatory arbitration clauses, and no lending
13   without regarding ability to repay.
14            And finally, provide by state and MSA for
15   larger states monthly statistics to the public on
16   all homeowners who contact the bank and the action
17   taken as well as data on short sales, deeds in lieu
18   and foreclosures started and implemented.
19            As Senate Majority Leader Henry Reid
20   pointed out in a recent statement about the Federal
21   Reserve's intervention in the financial market, now
22   that the President has shown his willingness to
23   bail out Wall Street at taxpayers' expense, I hope
24   he will drop his opposition to proposals designed
 1   to help ordinary homeowners.
 2            Our coalition urges the Federal Reserve to
 3   begin intervening on behalf of at risk homeowners
 4   by approving Bank of America's acquisition of
 5   Countrywide only with the above conditions, and we
 6   will be submitting a written supplement by the
 7   29th.  Thank you.
 8       MR. BRAUNSTEIN:  Thank you very much.  Do you
 9   want to read Ms. Rangan's?
10                           (Whereupon, the following
11                           statement of Rashmi Rangan
12                           was read by Barbara van
13                           kerkhove.)
14       MS. VAN KERKHOVE:  My name is Rashmi Rangan.  I
15   am opposing this merger on behalf of the Delaware
16   Community Reinvestment Action Council, a 20 year
17   old fair lending and fair helping advocacy
18   not-for-profit in Delaware.
19            This form should be utilized as an
20   opportunity to address issues raised voluntarily or

21   through conditioning the merger.
22            In 2006, nearly 8,000 Delawareans, almost
23   ten percent of our population looked to either Bank
24   of America or Countrywide to meet their mortgage
 1   related needs.
 2            Our HMDA analysis and description of our
 3   concerns with Countrywide collection practices will
 4   be submitted in our written commentary.
 5            We oppose this merger because Federal Law
 6   bars banks from acquisitions that would increase
 7   market share above ten percent of U.S. deposits, a
 8   limit Bank of America exceeds.
 9            The deposits held by Countrywide's
10   Federally regulated savings bank should count
11   toward that limit.  We oppose this merger on
12   grounds that Countrywide is synonymous with abusive
13   practices in mortgage lending, collections, and
14   servicing the loans.
15            Others have spoken very eloquently on this
16   issue.  Let me say very briefly that in Delaware in
17   2007 Countrywide can confined African Americans to
18   higher cost loans 1.84 times more frequently than
19   whites.  If combined with Bank of America the
20   disparity for African Americans grows to 1.94.
21            The disparities for Latinos would also
22   increase from 1.29 for Countrywide to 1.32 for both
23   according to a study by Inner City Press, Fair
24   Finance Watch.
 1            Let me speak to credit card issues.  The
 2   impact of this high cost borrowing is long term.
 3   It is diverting resources from wealth building
 4   opportunities and has the potential of driving the
 5   most vulnerable into bankruptcy.  Moreover Bank of
 6   America continues the practice of universal default
 7   clauses.
 8            While some industry participants have
 9   indicated that they have eliminated this practice,
10   Bank of America has not.
11            Unfortunately these increases are applied
12   to the old balance and far exceed the original
13   agreed upon rate.
14            Now, credit cards and small businesses.
15   The use of credit cards to start up small
16   businesses is an even greater threat both to the
17   consumer who cannot benefit from the technical
18   assistance that comes from traditional small
19   business lending and to the lender who relies
20   solely on a person's credit score in the decision
21   making process, not the potential for a successful
22   business.  About two-thirds of U.S. small business
23   owners use credit cards for at least some business
24   expenses.
 1            If this merger is approved, and I do not
 2   doubt it will be, we ask that Bank of America be
 3   required to, one, establish an aggressive borrower
 4   rescue program by modifying a loan to make that
 5   loan work for the borrower.
 6            Two, require and support housing
 7   counseling for all new mortgages and support
 8   consumer education.
 9            Three, implement concepts of suitability
10   doctrine in loan originations and fair dealing in
11   servicing and collection.
12            And, four, report on its performance to
13   the regulator and the local community.
14            Failure to meet these conditions should
15   also have consequences.  Thank you for this
16   opportunity.
17       MS. BRAUNSTEIN:  Thank you very much.
18   Ms. Hutson.
19       MS. HUTSON:  Good morning.  My name is Erin
20   Hutson, I'm the manager of investment relations for
21   the Laborers Union.
22            The Laborers Union has over 500,000
23   members most of whom are construction workers.
24   These workers have faced what we are calling a
 1   triple threat due to the current downturn in the
 2   residential market.  Our members have lost jobs,
 3   they have lost their homes, and they have seen a
 4   portion of their retirement security evaporate over
 5   the past two years due to this crisis.
 6            Lionhart Pension Funds invest assets of
 7   over $32 billion to provide for the retirement
 8   security of the hard working men and women of
 9   Lionhart.  We are long-term shareholders of Bank of
10   America and we oppose the Countrywide acquisition
11   as it is currently structured.  I would add that if
12   Bank of America shareholders could probably vote on
13   this deal we probably would vote against it.
14            Of particular concern to Lionhart is what
15   we believe to be a fundamental conflict of interest
16   that is built into its structuring, that is Bank of
17   America has not shielded shareholders or consumers
18   from the in-house origination of mortgages by home
19   builders.
20            So how does home builder mortgage
21   origination relate to Bank of America you ask?  We
22   believe the link is clear, builders have an
23   incentive to sell inventory at the highest price
24   possible and in-house mortgage units allow the
 1   financing to make it possible.
 2            After originating a mortgage, builders
 3   sell their in-house mortgages to lending partners
 4   in the secondary market.
 5            Countrywide has been a key player in this
 6   arena.  Countrywide has servicing, marketing, and
 7   secondary market relationships with the country's
 8   largest home builders, including Beazer Homes, Toll
 9   Brothers, NBR, Ryland Homes, and K.D. Homes, that's
10   not an exhaustive list, it's just a sampling.
11            So we would like to make the following key
12   points.  Countrywide owns and services many of the
13   loans made by home builders.  We estimate that as
14   many as half of these loans are ARMS that will be
15   adjusting in the next few years.
16            Homeowners in new subdivisions have seen
17   huge decreases in their property values.  Just for
18   example, a KD Home development in Buckeye, Arizona,
19   the tax assessor lowered assessments year over year
20   anywhere from 50 to $70,000, and so Bank of America
21   is going to potentially inherit whole subdivisions
22   that are decreasing in property value, have
23   resetting ARMS and high loan to value ratios all
24   because of specific relationships with large home
 1   builders.
 2            Here's an example of the type of builder
 3   originated mortgages that Bank of America is going
 4   to inherit.
 5            An analysis outside of Maricopa County
 6   which is outside of Phoenix, for over 650 recently
 7   built homes by either KD Home or Richmond American
 8   Homes shows the decline in value from the purchase
 9   price to the current assessment is 33 percent, this
10   is greater than other, you know, home declines in
11   the Phoenix area.  We think that this is an example
12   that new home subdivisions by builders are faring
13   worse than average.
14            KD Homes has an exclusive joint venture
15   with Countrywide.  An analysis of data provided by
16   the Home Mortgage Disclosure Act shows that home
17   builders increasingly sold high cost mortgages and
18   first and second mortgage combinations with high
19   second cost mortgages.
20            For example, the lender KD
21   Home/Countrywide originated 405 percent more
22   subprime loans in 2006 than in the year prior.
23            Although Bank of America has said that
24   they factored in the cost of litigation into their
 1   purchase price of Countrywide, we fear that
 2   additional lawsuits filed since the January 2008
 3   agreement may be above and beyond the scope of
 4   their original calculations.
 5            One lawsuit in particular, Mark Zachary
 6   versus Countrywide alleges that Countrywide pushed
 7   unqualified buyers into homes that they could not
 8   afford so that the home builder KD Home could
 9   unload their inventory and move forward with new
10   contracts.
11            Bank of America has traditionally held to
12   a safe low risk business model and has been focused
13   on returning to more traditional banking.
14            When asked what aspects of Countrywide's
15   business he may want to eliminate during the
16   investor teleconference Bank of America hosted
17   announcing the merger, CEO Kendall has stated no
18   subprime, then you would have correspondents, but
19   it would not include any large bulk purchases, I
20   don't like the cocaine of large bulk purchases, so
21   we would eliminate that.
22            Clearly when you have the CEO of Bank of
23   America stating that he did not like the cocaine of
24   large bulk purchases he was acknowledging some of
 1   the risks associated with correspondent lending,
 2   and we believe builders should fall into the same
 3   category given the inherent conflict between their
 4   goal of selling a house and selling a mortgage.
 5            To protect shareholders and consumers from
 6   conflict and risk, we believe that Bank of America
 7   should sever relationships with Countrywide --
 8   should sever the relationships that Countrywide has
 9   with large home builders.
10            We contacted Bank of America in
11   February 2008 and asked for a report to
12   shareholders detailing the steps they are taking to
13   shield shareholders from the relationships that
14   Countrywide has with builders.
15            We haven't received a report, however, we
16   will raise the issue at their shareholder meeting
17   tomorrow.  Thank you.
18       MS. BRAUNSTEIN:  Thank you very much.
19   Ms. Harris.
20       MS. HARRIS:  Good morning.  My name is Annie
21   Harris, and I'm a member of Action Now.
22            I want to thank you for letting me speak
23   to you today.  Action Now is a grass root
24   membership organization fighting for social justice
 1   and stronger communities.
 2            Action Now successes include campaign for
 3   better housing, schools, neighborhood safety,
 4   healthcare, and better job conditions.  We want you
 5   to not approve the merger between Countrywide and
 6   Bank of America unless Countrywide stop pushing
 7   people into foreclosures.
 8            Now, I'm a resident of the West Englewood
 9   community, a neighborhood in Chicago that has been
10   devastated by the foreclosure crisis.
11            Now, in West Englewood last year there was
12   702 foreclosures, to me that is heart breaking.
13   Foreclosures in my neighborhood like in many others
14   across the country invite crimes, this could
15   decrease property values and threaten safety of our
16   communities.
17            Now, I own a home on the south side of
18   Chicago, and all up and down my block and across
19   the alley in back of my house there are boarded up
20   houses, so the boards are torn off the windows and
21   the doors and the houses are used by people selling
22   drugs.
23            How do I know?  I can see from my house
24   cars stopping and people coming out of the boarded
 1   up houses to sell drugs.
 2            So Countrywide is also notorious for their
 3   abusive collection department and their
 4   unwillingness to work with the borrowers and
 5   provide affordable solution.
 6            So why should the Bank of America bail out
 7   Countrywide when Countrywide is unwilling to help
 8   its own borrowers?  So before a merger is approved,
 9   we want Countrywide to put in place a system where
10   people are sent to loss mitigation instead of
11   foreclosures and people's mortgages are changed to
12   fixed rate affordable 30 year mortgages.
13            Countrywide shouldn't be rewarded for
14   pushing loans that people can't pay and for pushing
15   people into foreclosures.  I want to thank you.
16       MS. BRAUNSTEIN:  Thank you very much.  Any
17   questions?  Thank you.
18            We're going to take a break now for lunch.
19   We're going to take an hour and we'll reconvene at
20   12:45.  If people want to sign up for the open mike
21   session, the list is right outside the door
22                      (Lunch break.)
 1                 AFTERNOON SESSION
 2       MS. BRAUNSTEIN:  We're going to get started
 3   with the afternoon session, and our first panel is
 4   in place, I just want to -- in case you weren't
 5   here this morning to hear the opening comments, we
 6   have time keepers right there, raise your hands,
 7   and the box with the little lights in it is green,
 8   and the second light is yellow, and that will come
 9   one when you have two minutes left, and then the
10   red light when your time is up in addition to which
11   they have signs.
12            So anyway, if you could just kind of pay
13   attention to that, and we also would ask for the
14   record for the court reporter who is doing the
15   transcript, before you begin your statement to
16   state your name and your organization.  And with
17   that we'll start with Kim Drayton.
18       MS. DRAYTON:  Yes.  Good afternoon.  I come out
19   of a faith based community, and I saw you caution
20   Reverend Jackson, I'm not going to breach, I hope
21   not to get the yellow light.
22            Good afternoon, I'm Kim Drayton, I serve
23   as the director for the Metroplex Economic
24   Development Corporation which is a nonprofit
 1   organization established by Bishop T.D. Jakes to
 2   bridge the socioeconomic gap that existed to
 3   historically underserved community, that includes
 4   low to moderate income borrowers.
 5            First I would like to thank the Federal
 6   Reserve Board for the opportunity to provide
 7   comments in this public hearing, it is truly an
 8   honor and privilege to carry the voice of the
 9   people to decision and policy makers who can really
10   make a difference and have an impact.
11            I've had an opportunity to sit through the
12   morning's testimony and have heard those who were
13   both for and against the Bank of America merger.
14            I've heard Laura Johnson from Action Now
15   speak to the heart of the crisis from the
16   perspective of a trouble homeowner, somebody about
17   to lose their home.
18             I've watched Bruce Marks of NACA have
19   over a dozen at risk homeowners stand to visually
20   demonstrate the reality of the crisis.
21            I've even heard the esteemed Reverend
22   Jesse Jackson present a three-pronged platform for
23   change including freeze in foreclosures, freeze in
24   rates, and restructuring loans, and admonishing
 1   Bank of America if this merger goes through to
 2   create a national nationwide outreach, community
 3   outreach initiative, however, what I have not heard
 4   from the plethora of organizations and speakers
 5   this morning was anyone address the root cause of
 6   the mortgage crisis.
 7            To the Federal Federal Board, Bank of
 8   America leadership, and the community entities
 9   represented here today, I would just ask kind of a
10   rhetorical question, if the pockets of Bank of
11   America and Countrywide were deep enough to
12   restructure all of the current at risk mortgages as
13   well as the ones that will reset and cause a whole
14   other wave of at risk, would that -- will that
15   actually help holistically address the issue or
16   provide just a temporary remedy for more a
17   prevailing issue?
18            I'm a product of a faith based community,
19   and since your instructions were to be myself, I'm
20   going to be myself today, and I'll say the word
21   says that my people are destroyed for lack of
22   knowledge or my people perish for a lack of
23   language.
24            I hardly believe that anyone -- that any
 1   of us desire, even the most predatory lender
 2   desires for their customer to perish, it doesn't
 3   help anyone, no one wins in that scenario, not the
 4   individual, not the family, not the community, the
 5   economy, and definitely not the financial
 6   institutions.
 7            I'm a strong proponent of the Bank of
 8   America/Countrywide merger not because -- simply

 9   because Bank of America underwrites all
10   initiatives, anybody can write a check, but because
11   through our partnership Bank of America has
12   demonstrated a level of leadership in the corporate
13   commitment to our constituents which transcends
14   beyond any monetary investment.
15            They literally figuratively transmitted
16   from the bank of standards to the bank of
17   opportunity when they recognized the commitment of
18   our constituents to their own development and
19   provided exceptions to people who would not
20   otherwise have been able to acquire bank accounts
21   because of credit or past charge-offs.
22            They also invest tremendously their human
23   capital.  The money is not enough, like I said
24   anybody can write a check.  We're not interested in
 1   a check, we want people who catch the vision and
 2   are committed to what it is that we do.
 3            I know that there was a gentleman on the
 4   first panel, Mr. Andrew Plepler from Bank of
 5   America global community impact, I don't know if
 6   he's still here, but I would just like to commend
 7   him -- is he still here?
 8            I would like to commend your division,
 9   your Texas area leadership under Aleta Stampley who
10   is doing your community impact there, tremendous,
11   she sees what the needs are for our people, and
12   sometimes she kind of bucks the grain, I know she
13   may even get in trouble, but it is working.  It is
14   working.  It is working.
15            It's a mangle to really look at when
16   you're talking about proactively addressing the
17   root cause of what is actually impacting us.
18            I'll give you a quote from one of our
19   constituents.  We run a five-week series, we're in
20   about the second one from this year where we have
21   250 people sitting in one classroom, they commit to
22   five weeks, they show up to five weeks.
23            These are adults who spend their Saturday
24   afternoons because they say we want to get this
 1   because the pulpit is probably one of the most
 2   powerful and influential voices in America, and
 3   when the preacher says get empowered, the people
 4   want to know how, we are the how to, we equip the
 5   people.
 6            Here's one of the comments.  Such a
 7   blessing, thanks for caring and sharing when no one
 8   else would.  These were things that were not taught
 9   and shared when I was growing up, so many pitfalls
10   I could have avoided.  I did my best in this life
11   but now I could do much better through your
12   teaching.
13            When people know better, they do better.
14   I've seen people stand up about mortgage
15   foreclosures, I am certain that nobody signs a 30
16   year mortgage expecting that they would ever be
17   foreclosed on.
18            The key to it is education and
19   partnerships like the one with Bank of America, I
20   think they can be achieved, people are
21   repositioning themselves and doing better in our
22   program.  So since I got the red light, I'll say
23   thank you.
24       MS. BRAUNSTEIN:  Thank you very much.  And
 1   Mr. Widrow.
 2       MR. WIDROW:  Yes.  My name is Robert, my
 3   nickname is Woody Widrow, and I'm the executive
 4   director of RAISE Texas, RAISE stands for Resources
 5   Assets Investment Savings and Education.
 6            RAISE Texas is a statewide nonprofit
 7   organization whose mission is to foster effective
 8   and sustainable initiatives that help individuals
 9   and families escape poverty by increasing personal
10   finance skills and building assets.
11            The Federal Reserve Bank has been an
12   active partner in the asset building field
13   nationally, and next week the Federal Reserve Bank
14   of Dallas, Houston branch will be hosting a RAISE
15   Texas Summit that will be cosponsored by the FDIC
16   and the Alliance for Economic Inclusion.
17            RAISE Texas collaborates with all sectors
18   to help individuals, families, and communities move
19   toward financial success.
20            I am here today to speak in support of
21   Bank of America.  I will not be commenting on
22   Countrywide Financial Corporation except to say
23   they hold my mortgage.
24            Bank of America staff have been active and
 1   supportive of RAISE Texas activities since we
 2   started in 2002 as the Texas IDA network.
 3            More recently, I'd like to provide three
 4   examples to demonstrate their commitment.  First,
 5   Bank of America provided us with a grant to support
 6   our overall work to expand asset building products
 7   and programs in Texas.
 8            One of these activities included expanding
 9   our website and providing a new search engine that
10   includes a statewide database for active building
11   activities.
12            The database allows Texans to type in
13   their zip code to find contact information and the
14   website for the nearest individual development
15   account program, free tax preparation programs,
16   home buyer education classes, financial education
17   programs, debt management organizations, and much
18   more.
19            Second, Bank of America is collaborating
20   with us to develop pilot asset building programs in
21   a few rural markets.
22            Last month in a partnership between RAISE
23   Texas, United Ways of Texas, and Bank of America we
24   held five rural asset building meetings in Uvalde,
 1   Huntsville, Pampa, Paris, and Kerrville, providing
 2   information on what is asset building, what are the
 3   products and programs included in this emerging
 4   field, and ways to begin to create or expand
 5   activities in these rural areas.  We will be
 6   working on the second phase of this initiative in
 7   the summer of this year.
 8            Third, RAISE Texas was officially
 9   incorporated in December 2007.  Our Board of
10   Directors now includes seven members from the
11   private and nonprofit sectors.  One of our board
12   members is Susan San Martine.
13            Susan is a senior vice president in
14   community development banking for Bank of America
15   out of their San Antonio office.
16            Because of her personal commitment to
17   asset building and community development, Susan was
18   asked to join our board and she accepted.
19            We believe she will serve RAISE Texas and
20   the families living in our urban and rural
21   communities well through her participation.
22            In terms of recommendations in moving
23   forward with the Bank of America acquiring
24   Countrywide, I have two suggestions.  First I was
 1   encouraged in 2004 when Bank of America Charitable
 2   Foundation set a national goal of 1.5 million over
 3   ten years.
 4            I think we need to revisit that written
 5   commitment and update this agreement to reflect the
 6   changing times and needs of our individuals,
 7   families, and communities.  I would welcome the
 8   opportunity to participate in this dialogue.
 9            Second, given the home mortgage
10   foreclosure and credit crisis that is affecting our
11   communities across this country, and especially
12   low and moderate income people, it is imperative
13   for us to look both backwards and forwards.
14            I believe given the right financial
15   products, sound financial education, and a
16   supportive financial community, low and moderate
17   income people can save, purchase a home, and retain
18   it over the long haul.
19            In Texas, many of our individual
20   development account programs have succeeded in
21   helping families with the purchase of their homes
22   with almost no foreclosures, this is because IDA
23   programs are well thought out in providing
24   financial education, home buyer education, and case
 1   management.
 2            I thank the Federal Reserve for holding
 3   this public hearing to increase the dialogue on
 4   ways Bank of America can help families succeed in
 5   our communities.  Thank you.
 6       MS. BRAUNSTEIN:  Thank you very much.
 7   Mr. James.
 8       MR. JAMES:  My name is Larry James, and I serve
 9   as president and CEO with Central Dallas Ministries
10   located in Dallas, Texas.
11            Central Dallas Ministries is an expansive
12   human and community development nonprofit
13   organization offering a wide array of opportunities
14   to low income neighbors and neighborhoods in the
15   inner city of Dallas, Texas including a community
16   based health and wellness delivery services, full
17   service public interest law firm, work force
18   training and placement services, after school
19   academies, emergency assistance for individuals and
20   families in need, administration of a large portion
21   of the Department of Agriculture summer food
22   program in Dallas and surrounding counties, an
23   Americorp team that includes 40 year round members
24   and 115 summer members, outreach services for youth
 1   who age out of the foster care system in the 19
 2   county CPS region around Dallas, aggressive
 3   partnership with Dallas Housing Authority and its
 4   tenants, and a growing Community Development
 5   Corporation that is building affordable housing and
 6   housing first units for our homeless population,
 7   and our centerpiece project right now is a
 8   restoration of a 15 story downtown office tower in
 9   the middle of our city that will provide affordable
10   housing and housing set aside for homeless
11   individuals.
12            I lead a staff of over 100 full time
13   employees not including the Americorp team I just
14   mentioned which would amount to an additional 150
15   community workers.
16            I've been at Central Dallas Ministry since
17   1994, and over the last decade, Central Dallas
18   Ministries has enjoyed a growing connection to the
19   community investment activities of Bank of America
20   for whom I'm here to testify and support today.
21            I join my colleague in saying I really
22   don't have anything to say about Countrywide except
23   they hold my mortgage as well.
24            We have been the beneficiary -- and also
 1   would add that when Bank of America makes this
 2   venture very profitable, I know the bank will want
 3   to do more in the inner city in Dallas.
 4            We have been the beneficiary of grant
 5   funds for our various programs and in recognition
 6   and support of various team members, volunteers,
 7   and board members from Bank of America.
 8            We were selected as recipients of Bank of
 9   America's first annual neighborhood excellence
10   award in Dallas in 2004 that carried with it a
11   $200,000 capacity building grant that has allowed
12   us to grow grammatically as an organization both in
13   number and in quality I think over the past four to
14   five years.
15            The Central Dallas Community Development
16   Corporation has worked closely with the community
17   development banking team from Bank of America on
18   several projects, and we've received invaluable
19   counsel and guidance that has served to advance our
20   efforts in Dallas among very low income persons in
21   need of fit and affordable housing including the
22   poorest of our citizens who live on the streets of
23   Dallas today.
24            In addition, we have observed over the
 1   past fourteen years the commitment of Bank of
 2   American in Dallas to the work of other community
 3   development corporations expressed in the form of
 4   development partnerships or specific housing
 5   developments, and in the form of overall support of
 6   the nonprofit housing development sector in our
 7   community.
 8            We have witnessed the expansion of banking
 9   products and services to the people and the
10   communities who are the focus of much of our work
11   in the inner city.
12            One of my best board members is Stan
13   Shipley, senior vice president with Bank of
14   America, and I think he actually worked on this
15   particular field that we're discussing here today.
16            Bank of America employees have volunteered
17   in our various program sites.  Their leaders have
18   included our organization in various capacity
19   building and gone to relationship events as well.
20            For over a year we worked closely with a
21   team from the Community Development Banking
22   Department of Bank of America on a cutting edge
23   project that would have combined market rate
24   housing with housing set aside for youth who age
 1   out of the foster care system with no live plan
 2   including no housing plan, unfortunately that
 3   effort fell apart in the last hour through no fault
 4   of the bank's team but due to factors beyond any of
 5   our control.
 6            In short, we have found Bank of America to
 7   operate as a trusted community partner who has
 8   conveyed great benefits to organizations like
 9   Central Dallas Ministries that very hard at work
10   every day in marginalized communities in need in
11   inner city Dallas, Texas.
12            We look forward to a growing relationship
13   with the bank in the future, and I'm pleased to
14   offer a word of support for the bank today.  Thank
15   you very much.
16       MS. BRAUNSTEIN:  Thank you very much.
17   Mr. Avery.
18       MR. AVERY:  Good afternoon.  My name is Michael
19   Avery, and I'm the executive director of Community
20   Housing of Wyandotte County in Kansas City, Kansas,
21   a community development corporation whose
22   commission is to serve the needs of those seeking
23   affordable housing in our town.
24            We built affordable housing in Kansas
 1   City, Kansas, and this year we're building an
 2   additional hundred units serving low and moderate
 3   income population of that city, and we couldn't do
 4   it without the help of our partner, Bank of
 5   America.
 6            Last year like my colleague, we were the
 7   recipient of the neighborhood builder award with a
 8   $200,000 capacity grant in 2007 that has helped
 9   organizations serving more members of our
10   community.
11            In addition to that award, the majority of
12   our low to moderate income clients received their
13   mortgages from Bank of America, and on our board as
14   well is vice president of the bank, Mae Hayes, who
15   helps attain those affordable mortgages for our
16   clients.
17            Bank of America is committed to
18   neighborhood excellence through its products, its
19   philanthropy, and through its volunteerism.
20            In contrast, Countrywide has little
21   commitment in Kansas City, Kansas.  Bank of America
22   is the bank that continues to step in when needed.
23            One example, a client, the Bates family
24   purchased a home with an adjustable rate mortgage,
 1   the ARM reset to 14 and a half percent, and the
 2   mortgage payment went from $850 to over $1400.
 3            Working with Bank of America, we were able
 4   to get that family refinanced with a 30 year fixed
 5   loan at six and a half percent making their
 6   payments at $825 a month including their taxes and
 7   insurance.
 8            Couldn't have done it without Bank of
 9   America, it wouldn't have been possible in our town
10   without their help.
11            Should this acquisition proceed?  It is my
12   fervent hope that the behavior and values of Bank
13   of America will be embraced by those Countrywide
14   associates that they remain with the new
15   organization.
16            I believe that the acquisition of
17   Countrywide by Bank of America is good for all the
18   neighborhoods that my organization serves in Kansas
19   City, Kansas, greater Kansas City, and frankly the
20   United States.
21            I wholeheartedly support the acquisition
22   and the actions of Bank of America in this action.
23   Thank you.
24       MS. BRAUNSTEIN:  Thank you very much.
 1   Questions for the panel?  Thank you very much.  You
 2   can call the next panel up.
 3            Just to go over the procedures again, the
 4   time keepers, raise your hands, time keepers,
 5   little box with the light, there's a green light,
 6   yellow light goes on with two minutes left, red
 7   light goes on when your time is up.
 8            And please begin your statements by
 9   stating your name and organization.  And thank you
10   very much for being here, and we'll start with
11   Mr. Egan.
12       MR. EGAN:  Thank you very much.  It's a
13   privilege and pleasure to be here this afternoon.
14   I'm Conrad Egan, I'm the president and CEO of the
15   National Housing Conference which is the nation's
16   oldest and most broad based affordable housing
17   policy and advocacy organization.
18            And I'm here today to testify in support
19   of the Bank of America/Countrywide merger, and I
20   want to recognize a few examples I would like to
21   give why I'm taking that position and not just
22   because of what the bank has done but because of
23   what the foundation has also done.
24            Let me start, first of all, with some
 1   national examples and I'll drill down to two very
 2   specific examples that I'm personally familiar
 3   with.
 4            First of all, I want to note that the Bank
 5   of America has made substantial commitments that
 6   we're all aware to advance the cause of community
 7   development lending and affordable housing across
 8   the nation.
 9            I had the privilege a few years ago of
10   testifying before the Federal Reserve Board in the
11   context of the Fleet acquisition, and I'm very
12   pleased as I know you know that that commitment and
13   others has been fulfilled -- is in the process of
14   being fulfilled completely in all regards.
15            I also want to note that as is the case
16   with certain other major national financial
17   institutions, the Bank of America is the purchaser
18   of low income housing tax credits, a major
19   purchaser, and they've done a lot to, therefore,
20   provide proceeds for the development and
21   preservation of affordable housing.
22            Unfortunately some other major financial
23   institutions who shall remain unidentified here
24   have pulled out of that market, thus significantly
 1   reducing the value of those credits.
 2            Bank of America has not pulled out of that
 3   market, it's not to say that it hasn't had to
 4   adjust its risk analysis and procedures and its
 5   underwriting procedures, but it stayed in that
 6   market which is a very important source of capital
 7   for reserving and reducing affordable housing.
 8            Also I would like to note as some of my
 9   preceding colleagues have, particularly Judy
10   Kennedy from HAAHL, the role that the bank has
11   consistently played in supporting and advancing at
12   the national level the kind of policies, the kind
13   of legislation, the kind of financial support that
14   we need to carry forward with our mission.
15            And then I would also like to recognize as
16   some of the other presenters have including two who
17   were on the immediately preceding panel the
18   importance of a neighborhood excellence program
19   which has done a lot to strengthen leadership and
20   to build capacity amongst those organizations that
21   serve communities and support affordable housing
22   across the nation.
23            Let me close by giving you two very
24   specific examples of innovative support on the part
 1   of the Bank of America.  I serve on the board of a
 2   regional nonprofit housing development corporation
 3   in the Washington, D.C. area called the Community
 4   Preservation Development Corporation.
 5            We were able to purchase and recapitalize
 6   and rehabilitate an aging public housing complex
 7   for seniors in Washington, D.C. called Edgewood
 8   Terrace.  We could not have done that without the
 9   support of the Bank of America provided by being
10   willing to issue debt based upon the flow of funds
11   from the public housing capital fund.
12            At the time, although this has become more
13   common now, this was a dramatic break through and
14   very innovative demonstration of the bank's
15   willingness to exert leadership.
16            One other quick example, I also serve on
17   the board of Open Door Housing Fund which is
18   regional in Washington, D.C., a fund that provides
19   capital for the -- predevelopment capital for the
20   acquisition and preservation of affordable housing,
21   and again the bank has been very supportive of that
22   organization not only from a funding standpoint as
23   in providing capital but also by being very
24   generous with the time of Ryan Tracy who sits on
 1   the board along with myself and others and who has
 2   provided significant leadership for that
 3   organization.
 4            So it is for these reasons, both national
 5   and two very specific examples that I gave you that
 6   I on behalf of the National Housing Conference
 7   support the Countrywide/Bank of America merger.
 8       MS. BRAUNSTEIN:  Thank you very much.
 9   Ms. Denny.
10       MS. DENNY:  Thank you.  I'm here to support the
11   Bank of America in this merger question.
12            Again I don't have a lot of experience
13   with Countrywide other than they've held my
14   mortgages before.
15            It seems to be a repeating note.  I'm
16   Linda Denny, I'm president and CEO of the Women's
17   Business Enterprise National Council, also known as
18   WBENC, we are a 501(c)(3) nonprofit organization
19   based in Washington, D.C.
20            WBENC provides access to the marketplace
21   for women-owned companies who are national and now
22   international third party certification program.
23            We certify that a company is at least
24   51 percent women owned, operated, and controlled,
 1   and then work through the supplier diversity and
 2   development programs of major corporations such as
 3   Bank of America to bring these Women's Business
 4   Enterprises or WBEs into the supply chain of
 5   vendors to major corporations.
 6            Now in our 11th year, WBENC has become the
 7   nation's leading and most respected WBE
 8   certification program.  Our process is so trusted
 9   many corporations will not accept any other
10   certification for their women owned companies.
11            WBENC was actually founded by eleven
12   corporations to provide a national Women's Business
13   Enterprise certification program with Nations Bank,
14   a predecessor company to Bank of America being the
15   leader.
16            Debra Cammon of Nations Bank, a senior
17   officer of Nations Bank served for several years as
18   the founding committee chair.  It was her
19   leadership and vision and the unending support of
20   Nations Bank that actually lead to the official
21   launch of WBENC in March of 1997.
22            Their support did not end with the launch
23   of WBENC but intensified when Nations Bank acquired
24   Bank of America and took their name.  The
 1   dedication of the company to the development of
 2   women owned businesses and to WBENC moved to a
 3   higher level.
 4            They have provided leadership by holding a
 5   seat on our Board of Directors since the very
 6   beginning, and this continues to this day with the
 7   executive vice president Joe Hill serving on our
 8   board.
 9            Bank of America has provided not only
10   financial support and it's certainly been very
11   generous in that, but also has been a solid partner
12   in creating programs that build the capacity of our
13   Women's Business Enterprises.
14            Several years ago they established the
15   Dorothy B. Brothers Scholarship Fund and committed
16   to raising a minimum of $70,000 per year to build
17   an endowment fund which now totals over $620,000.
18            Annually WBENC is now able to award $5,000
19   scholarships to 14 women business owners enabling
20   them to attend top rated executive management
21   programs in prestigious universities.
22            The approved management skill acquired as
23   a result of these generous scholarships has helped
24   grow women in companies and communities across the
 1   nation.
 2            Bank of America has also supported the
 3   Zenith Group, a program that is providing our
 4   largest businesses which have a minimum of at least
 5   50 million in annual revenues to become prime
 6   suppliers to the bank, meaning that they can take
 7   on larger contracts that small businesses typically
 8   can't get.
 9            WBENC provides our national certification
10   program through a network of 13 regional partner
11   organizations which also benefit from the
12   dedication of Bank of America.
13            The bank provides funds for each of these
14   organizations to do business development programs.
15   Employees of the bank volunteer to serve on many of
16   our certification committees and communities across
17   the nation.
18            Recently WBENC launched or first
19   international women's business certification
20   program in the United Kingdom and Bank of America
21   was there with us providing support and helping
22   grow this fledgling organization.
23            If I had time to tell you about the
24   details and involvement in support Bank of America
 1   has given WBENC you would hear not just about our
 2   programs but also about events that help fund the
 3   organization.
 4            Leadership has come from the top down.  In
 5   2004, CEO Ken Lewis served as our chair of our
 6   salute to Women's Business Enterprises which
 7   recognizes fourteen outstanding women business
 8   owners and helps raise the funds for our
 9   operations.
10            The bank also sponsors not only at a top
11   level but also our national conference searching as
12   the corporate chair of our national conference in
13   2005.
14            Our Women in Business National Conference
15   is the largest of its kind in the nation, allows us
16   to enable our businesses to make contacts that give
17   them contracts with corporations.  Can I finish?
18       MS. BRAUNSTEIN:  Go ahead.
19       MS. DENNY:  One more paragraph.
20            Bank of America has been the leader in
21   supplier development best practices for many years,
22   it is one of the very few companies recognized by
23   WBENC with our highly coveted top corporation for
24   Women's Business Enterprise award, not just once or
 1   twice, but six times.
 2            I want to close with a quote from my
 3   mother who always told me the proof is in the
 4   pudding.
 5            In 2007 Bank of America walked the talk by
 6   doing over $950 million in contracts with Women's
 7   Business Enterprises, so not only did the
 8   corporation and the shareholders benefit from
 9   buying from competitive vendors, they also helped
10   provide employment and build businesses and
11   communities across the country.
12            This is a very good thing, this is why we
13   very much appreciate and support Bank of America.
14       MS. BRAUNSTEIN:  Thank you very.  Mr. Paige.
15       MR. PAIGE:  Thank you.  My name is Richard
16   Paige, I'm with the Housing Partnership of
17   Northeast Florida in Jacksonville, Florida.  And
18   Countrywide does not hold my mortgage, so I guess
19   I'm in the minority.
20            The Housing Partnership of Northeast
21   Florida is a fifteen year old 501(c)(3)
22   organization that provides a range of services to
23   the Jacksonville, Florida community to promote and
24   preserve sustainable affordable home ownership.
 1            We are many things, but among them, we are
 2   a HUD certified homeownership counseling agency, we
 3   are a Naval Works homeownership center.  We are a
 4   nonprofit lender certified by the U.S. Treasury
 5   Department as a community development financial
 6   institution focusing on residential down payment
 7   assistance and foreclosure prevention lending
 8   solutions.
 9            We are a member of the Housing Partnership
10   Network, a member of the Opportunity Finance
11   Network, we're a small property developer of
12   affordable housing in Jacksonville, we're owner and
13   property manager of 595 affordable rental units and
14   multi family developments in Jacksonville, and
15   we're a property rehabilitation contractor for the
16   City of Jacksonville for low and extremely low
17   income homeowners providing substantial rehab to
18   over fifty homes per year and building 36 plus
19   wheelchair ramps per year.
20            I'm here as the director of the
21   homeownership center and the vice president of
22   lending services for the CDFI.
23            You certainly have a very distinguished
24   panel of experts and advocates here today, many in
 1   favor and some opposed to the matter at hand.  What
 2   we hope to offer is kind of a community perspective
 3   for Florida which I'm not sure we've heard from
 4   today.
 5            Housing Partnership in Northeast Florida
 6   is certainly in favor of the Bank of America
 7   acquisition of Countrywide home loans.
 8            Bank of America has an impressive and
 9   robust track record certainly in our community and
10   as we've heard I think from many other
11   organizations all over the country as a responsible
12   lender and community partner.
13            The Jacksonville community has been
14   significantly impacted by the recent softening of
15   the real estate market, encouraged if not spurred
16   on by the explosion over the last few years of
17   aggressive lending practices.
18            As many of you know, the State of Florida
19   is consistently ranked first, second or third in
20   every quarter over the last couple of years in the
21   rate of foreclosure filings.
22            This has been influenced greatly by Dade
23   and Brower Counties, also known as Miami and Fort
24   Lauderdale, and many believe that that is in great
 1   part due to the speculative nature of that real
 2   estate market over the last several years.
 3            What many people don't know is that
 4   Jacksonville comes only behind Dade and Broward
 5   County in the rate of foreclosure filings in the
 6   State of Florida.
 7            It's estimated that in 2005 which is the
 8   most recent full year of statistics available, one
 9   out of every three loans made in the Jacksonville
10   MSA was a subprime loan.
11            In Jacksonville, unlike other parts of the
12   state, these loans were not made to speculators,
13   they were made to working families and we are
14   certainly feeling the effects of that today.
15            What is also unique about the Jacksonville
16   market right now is while we face this very real
17   and significant foreclosure crisis which has
18   impacted the real estate market overall, the
19   affordable market is thriving and it's as active as
20   it's ever been.
21            In fact, in the fifteen year history of
22   the Housing Partnership there's never been more
23   demand for the home buyers education, home
24   ownership counseling, and programs and subsidies
 1   that we can connect borrowers to to make affordable
 2   homeownership a reality even in the midst of this
 3   declining market.
 4            It's often said that character is what you
 5   do when you think nobody is watching or no one is
 6   going to find out, and I think that what we hear
 7   today is five, ten, fifteen, twenty year
 8   relationships that Bank of America has had with
 9   community organizations like ours in really
10   perpetuating and promoting affordable sustainable
11   homeownership.
12            While other lenders were focusing on
13   cherry picking at the higher end of the market and
14   providing aggressive products to the lower end of
15   the market, Bank of America was and as they
16   continue to be committed to responsible lending and
17   committed to the affordable and low to moderate
18   income market.
19            While other lenders were developing and
20   offering 100 percent combined loan to value,
21   interest only and adjustable rate, stated income
22   purchases to products and products to borrowers
23   with nothing more than a 620 FICA and a pulse, Bank
24   of America was working with the Housing Partnership
 1   to develop the Home Buyers Club, a program that
 2   works with low to moderate income families to help
 3   them become mortgage ready, purchase ready, and
 4   places them into a low cost fixed rate affordable
 5   home loan not based solely on the borrowers ETI,
 6   but based on a budget developed with a
 7   homeownership counselor that we can demonstrate is
 8   affordable to that borrower which creates
 9   sustainability of homeownership.
10            Through excellent corporate and local
11   leadership Bank of America has and continues to be
12   a sincere community partner, whether making equity
13   investments in nonprofit organizations, making
14   philanthropic donations, sponsoring community
15   events, providing volunteers for educational
16   programs, community outreach efforts, or simply
17   doing their job as a responsible lender, Bank of
18   America has walked the walk, and we are pleased to
19   offer our comments in support of their acquisition
20   of Countrywide.  Thank you.
21       MS. BRAUNSTEIN:  Thank you very much.
22   Mr. Coleman.
23       MR. COLEMAN:  I'm here, John Coleman, I'm
24   director of finance for Reynoldstown Revitalization
 1   Corporation in Atlanta, Georgia, and I'm here in
 2   support of Bank of America's effort to proceed with
 3   this transaction.
 4            I'm here in place of our CEO Mr. Young
 5   Hughley, and I would like to correct the record,
 6   Mr. Young Hughley, Jr., and I would like to read a
 7   letter of support.
 8            This is to Mr. Gill, assistant vice
 9   president of Federal Reserve in Richmond.  Dear
10   Mr. Gill, I'm writing in support of Bank of
11   America's community development efforts as they
12   pursue a new relationship with Countrywide.  RRC is
13   at a not-for-profit community development
14   corporation founded in 1989.
15            Our mission is to support and develop
16   sustainable communities through knowledge sharing,
17   community building, housing and economic
18   opportunities with residents.
19            RRC's relationship with Bank of America
20   dates back to 1994.  Bank of America has been an
21   ongoing sponsor of our annual wheelbarrow festival
22   since that time.  The festival is a celebration of
23   our history and culture in the Reynoldstown
24   community as well as a fundraiser for home repairs
 1   and other community projects.
 2            In 1996 RRC and Bank of America initiated
 3   planning for an infield development partnership.
 4   Through that partnership RRC provided at least 23
 5   affordable single family homes.
 6            Bank of America assisted RRC in 2007 with
 7   the capacity building grant of $25,000 that
 8   provided us with timely equipment purchases and
 9   furniture purchases for our homeownership center.
10            RRC's homeownership center partners with
11   the Bank of America in the administration of the
12   community investment product, community commitment
13   product with RRC providing home buyer education and
14   counseling to these clients.  RRC has found this
15   mortgage product to be a solid product for our
16   perspective homeowners.
17            Due to this acquisition it is important
18   for Bank of American through the CRA planning to
19   make a greater investment in CDCs not-for-profit
20   organizations to provide financial literacy
21   services, home ownership counseling, pre and post
22   purchase counseling, and foreclosure assistance.
23            This is not to blame the present real
24   estate crisis on the banking industry, I feel the
 1   consumer has to share in this as well.
 2            However, I do feel that as a corporate
 3   citizen, the bank needs to be proactive in
 4   educating the consumer.
 5            The American consumer is living beyond his
 6   or her wages, Bank of America needs to support
 7   programs that support smart consumption and living
 8   within one's means.
 9            The end result of such would be to
10   increase charitable giving and yield the smarter
11   consumer that would reflect greater dollars flowing
12   into communities and banks and hopefully in a more
13   stable economy.
14            Just a couple of quick comments.  Owning a
15   home does not create wealth, I think we've seen
16   that over the last several months.
17            The decisions made regarding money, credit
18   management, and the management of all those
19   resources determines homeownership and wealth
20   opportunities.
21            A lack of knowledge in financial
22   management area negatively impacts wealth building
23   opportunities.
24            With this said, I think Bank of America's
 1   combination with Countrywide presents a porthole
 2   for providing that kind of education to people who
 3   are burdened with debt and the lack of savings.
 4            Such community and financial commitment
 5   and training will result in creating future
 6   business opportunities for funding, entrepreneurial
 7   opportunities, investments, as well as
 8   homeownership investments.  Thank you very much.
 9       MS. BRAUNSTEIN:  Thank you very much.  Any
10   questions?
11            Okay.  Next panel?  A little procedure,
12   our time keepers are there, and please state your
13   name and organization at the beginning of your
14   statement.
15            We'll start with Mr. Breymaier.  Is that
16   right?
17       MR. BREYMAIER:  Yes.  Thank you.
18       MS. BRAUNSTEIN:  Good guess.
19       MR. BREYMAIER:  My name is Rob Breymaier, I'm a
20   member of the Board of Directors of the Chicago
21   Area Fair Housing Alliance which is a consortium of
22   25 nonprofit and government entities working in the
23   Chicago region to ensure equal housing opportunity
24   throughout the six county region.
 1            CAFHA is concerned in general about fair
 2   lending and community reinvestment.  CAFHA has
 3   taken a neutral stance on the Bank of America
 4   acquisition of Countrywide, however, we would like
 5   to point out some areas for attention by regulators
 6   as Bank of America and Countrywide merge,
 7   particularly we hope that regulators will closely
 8   monitor the channels in which borrowers access
 9   credit.
10            Over the past decade there is a clear
11   distinction throughout the lending industry in the
12   channels of whites and people of color acquiring
13   mortgages.
14            Whites are more likely to get a mortgage
15   through a direct retail channel at a bank, and
16   people of color or more likely to attain financing
17   through brokers, and this is primarily due to the
18   lack of bank branches and quality mortgage services
19   in communities of color which is a fact that's been
20   siezed upon by mortgage brokers looking to find
21   untapped markets.
22            This dual system harms people of color
23   because brokers often charge higher fees and have
24   incentives to increase the interest rate of a loan
 1   through the practice of yield spread premiums, and
 2   moreover brokers are less accountable than banks
 3   and they are more likely to engage in predatory
 4   lending and other unscrupulous practices.
 5            Bank of America has relatively few
 6   branches located in communities of color, and for
 7   that matter LaSalle also does which Bank of America
 8   just recently acquired.
 9            On the contrary mortgage brokers providing
10   Countrywide mortgages are prevalent in these
11   communities of color.  This array of locations will
12   make it difficult for Bank of America to ensure
13   that all borrowers will receive the best mortgage
14   product available to them.
15            CAFHA feels that a good measure of whether
16   a lender values minority market deeply to white
17   markets is market share.  In 2006 HMDA data shows
18   that Bank of America in the Chicago region made
19   about 3.1 percent of all loans to white borrowers,
20   yet it only made about 1.8 percent of African
21   American mortgages and 1.9 percent of Latino
22   mortgages for conventional home purchases.
23            Meanwhile Countrywide has similar market
24   share for white borrowers, 4.2 percent -- I'm
 1   sorry, a smaller market share for white borrowers
 2   at 4.2 percent than they had for African
 3   American/Latino borrowers at 6.5 and 8.1 percent
 4   respectively.
 5            We hope to see Bank of America improve its
 6   market share to minority borrowers rather see a
 7   bruised market share by providing loans through
 8   Countrywide.
 9            The reason for this is that Bank of
10   America is typically a prime lender and only three
11   percent of Bank of America's conventional home
12   purchase mortgages had a rate spread above -- of
13   three points or greater above prime, but on the
14   contrary Countrywide offers subprime mortages
15   often, and it's rate of high cost loans was
16   37 percent.
17            In fact, this was even worse and more
18   pronounced in the African American and Latino
19   communities.  Those borrowers respectively received
20   high cost loans 74 percent of the time and
21   50 percent of the time in the conventional home
22   purchase data under HMDA in 2006.
23            If Bank of America's acquisition of
24   Countrywide is finalized, CAFHA urges regulatory
 1   agents to closely monitor the possibility for a
 2   dual market that may cause disparities in products,
 3   terms and conditions offered to white borrowers
 4   versus minority borrowers.
 5            Furthermore CAFHA suggests that Bank of
 6   America open more branches in predominantly
 7   minority census tracks, hire affirmative marketing
 8   staff to increase its prime rate minority share,
 9   and partner with housing counseling industries that
10   work with minority borrowers and communities.
11   Thanks.
12       MS. BRAUNSTEIN:  Thank you very much.
13   Mr. Shivak.
14       MR. SHIVAK:  Thank you.  Good afternoon.  I
15   appreciate the opportunity to be here.  My name is
16   Steve Shivak, I'm the executive director for the
17   Pittsburgh Community Reinvestment Group.
18            We are a 501(c)(3) nonprofit organization
19   that serves to low to moderate income communities,
20   and that would be in the County of Pennsylvania
21   where the City of Pittsburgh is located.
22            One of the ways PCRG promotes neighborhood
23   stability and works towards equitable access to
24   resources for all people is through homeownership
 1   preservation.
 2            PCRG accomplishes this goal through
 3   negotiating with lenders and distressed borrowers
 4   to keep them in their homes.
 5            In an effort to not repeat some of the
 6   testimony earlier today, I'm going to focus my
 7   comments specifically on southwestern Pennsylvania
 8   and Allegheny County.
 9            According to the 2006 reportable data
10   Countrywide home loans is ranked first in overall
11   market share issuing nearly 4800 single family home
12   loans or almost 9 percent of the market.
13            When considering all of Countrywide
14   affiliates together, Countrywide issued almost 5200
15   loans for a combined market share of almost 10
16   percent.
17            According to the same reportable data,
18   Bank of America is tenth in market share with 1.67
19   percent of single family homes.  If the merger or
20   acquisition goes through, the resulting institution
21   is, therefore, going to have a market share of
22   11.38 percent which will make it in the top lender
23   of the market or at the very worse the top three.
24            Astonishingly neither Bank of America nor
 1   Countrywide's most recent CRA exam included the
 2   Commonwealth of Pennsylvania as an official
 3   assessment area, although these lenders had such
 4   large market shares in the Pittsburgh MSA.
 5            The lack of a physical brick and mortar
 6   branch office is mainly the reason why neither
 7   Pittsburgh nor Pennsylvania were scrutinized by CRA
 8   exams.
 9            As mentioned earlier, the Office of the
10   Comptroller of the Currency has not conducted a CRA
11   examination for Bank of America since 2000, 2001,
12   that was published in 2003 and it serves as Bank of
13   America's last evaluation.
14            As a practice, the OCC generally conducts
15   CRA examinations of national banks every three
16   years, so one of the things we would like to see is
17   the accountability of America's financial
18   institutions to all communities, and the compliance
19   of America's financial institutions with Federal
20   Law.
21            The OCC has mandated to consult its CRA
22   examinations in evaluating bank mergers, and as
23   such we believe the OCC should immediately examine
24   the Bank of America's CRA compliance for the time
 1   period of '05, '06 before actually ruling on the
 2   proposed acquisition.
 3            Based on the number of prime loans in
 4   Pittsburgh in the Commonwealth, we believe that the
 5   region should be and must be added as an official
 6   assessment area for the next year.
 7            If it's not done, regulators will fail to
 8   assess if a major lending institution is meeting
 9   credit needs in a safe and sound manner in a
10   community which they have such large presence.
11            I'm glad to see the gentleman to my left
12   has statistics as well.  From our standpoint, Bank
13   of America and Countrywide trail the average
14   percentage of all lenders for prime loans in
15   Pittsburgh MSA including loans to African
16   Americans, loans to low and moderate income
17   borrowers, and loans to low and moderate income
18   tracks, something that we believe is very important
19   that you should be considering.
20            In addition, we have worked very hard over
21   the past three years to establish a relationship
22   with Countrywide to ensure that Countrywide uses a
23   streamlined efficient transparent process in
24   dealing with distressed borrowers and that it
 1   dedicates staff to coordinating issues concerning
 2   it's primes.
 3            The Federal Reserve must ensure that the
 4   Bank of America can demonstrate sufficient capacity
 5   to effectively serve 9 million additional customers
 6   if it approves this acquisition.
 7            We believe Bank of America must also
 8   demonstrate a willingness to negotiate amenable
 9   solutions to fraudulent and predatory loans and
10   that they must guarantee they won't simply neglect
11   the distressed borrowers in order to allow troubled
12   portions of its portfolio to go into foreclosure as
13   a way of skimming the most valuable portions of its
14   portfolio to shareholder value.
15            In April 2003, press announcement --
16   excuse me, Bank of America chairman and chief
17   executive officer Kenneth Lewis said of Bank of
18   America's latest CRA evaluation:  "We are extremely
19   proud of this accomplishment which recognizes our
20   lending, investment, and service commitments to the
21   communities we've served.  That outstanding rating
22   reflects our commitments to higher standards, the
23   idea that in every endeavor there is always an
24   opportunity to raise the bar, to do something
 1   better than anyone has done it before."
 2            The Federal Reserve must enable PCRG to
 3   verify that Bank of American will raise the bar
 4   above our current relationship with Countrywide and
 5   help us protect even more homeowners from
 6   foreclosure due to predatory and unethical loans.
 7            Until such that time, PCRG is adding our
 8   names to the list of groups that are unfortunately
 9   testifying against the acquisition.
10            We appreciate the time to be here, and
11   we'll have our information if you have any
12   questions.
13       MS. BRAUNSTEIN:  Thank you very much.  Any
14   questions for the panel?
15       MS. WILLIAMS:  I've got one.  Could I ask you,
16   Mr. Breymaier, to clarify one thing, I think you
17   just mentioned it.
18       MR. BREYMAIER:  Sure.
19       MS. WILLIAMS:  You mentioned something about
20   the dual markets, I didn't really catch it.
21       MR. BREYMAIER:  Yes.  Well, we've been
22   concerned for sometime now about how borrowers get
23   loans from different lenders, and we have found
24   that most often white borrowers are more likely to
 1   find a loan through a direct retail channel, most
 2   often a loan officer at a bank branch, for
 3   instance, versus African American/Latino borrowers
 4   often are first introduced products through a
 5   mortgage broker, that draws a different channel,
 6   it's a different market, it creates a different set
 7   of circumstances for the borrower and is usually to
 8   the disadvantage of people of color.
 9       MS. WILLIAMS:  Thank you.
10       MS. BRAUNSTEIN:  Okay.  Thank you very much.
11   And we'll have our next panel come forward.
12            Good afternoon, thank you for joining us.
13   And just to run quickly through procedure, we have
14   our time keepers right there who will give you a
15   signal when you have two minutes left, and then you
16   will hear the beep and see the red light when your
17   time is up.
18            And please start your statement with your
19   name and your organization so that we can make sure
20   we get it on the record.  And we'll start with
21   Mr. Holmes.
22       MR. HOLMES:  Great.  Thank you.  Good
23   afternoon.  I am Calvin Holmes, the executive
24   director of the Chicago Community Loan Fund, a
 1   metropolitan Chicago private nonprofit community
 2   development financial institution that has provided
 3   nearly 150 loans to start up, small, and mid sized
 4   organizations working to turn around some of
 5   Chicagolands most challenged neighborhoods.
 6            Our flexible loans that come with a great
 7   deal of customized technical assistance has helped
 8   our customers who we salute as local visionaries,
 9   attract approximately $550 million of additional
10   public and private capital to over fifty
11   communities across our great region.
12            Before I comment specifically on Bank of
13   America's intention to acquire Countrywide, wearing
14   my project finance hat, let me tell you what it has
15   been like to be an opportunity finance partner with
16   the bank.
17            Bank of America and its recently acquired
18   new franchise LaSalle Bank has been a very
19   resourceful and engaged partner that has helped and
20   is helping CCLF extend our capital into the the
21   furthest reaches of our communities.
22            Over several years the bank has
23   effortlessly provided CCLF with operating support
24   and investments.
 1            Clearly it is easy to publicly acknowledge
 2   the value of the bank's support of our operations,
 3   however, there's a role that the Bank of America is
 4   playing in our region that touches CCLF and our
 5   borrowers in a more important way.
 6            The bank is investing tens of millions of
 7   dollars directly in construction loans and via tax
 8   credit vehicles and game changing large scale
 9   development across the region.
10            Many may not know this, but it has become
11   a major player helping to finance the Chicago
12   Housing Authority's multi billion dollar plan for
13   transformation, but more specifically to CCLF, the
14   bank has provided construction finance for the 40
15   million dollar Whistler Crossing mixed use
16   development in Riverdale, Illinois, a small
17   entering suburb just south of the city that is
18   fighting valiantly to reverse years of decline
19   caused by industrial plight and is expected to
20   disclose on construction financing for the
21   $150 million mixed use Wilson Yard project in the
22   city's, dare I say, gritty uptown community.
23            CCLF is not only grateful to Bank of
24   America because it is a key source to repay our
 1   large predevelopment loans on both of these
 2   transactions but instead because both projects are
 3   very large and complex, and when I say complex, I
 4   mean 15 to 20 layers of financing and fraught with
 5   a fair amount of risk, but both projects should
 6   prove enormously transformational for their
 7   surrounding communities.
 8            We at CCLF encourage Bank of America to
 9   use it great bandwidth to continue financing high
10   risk complex projects like Whistler Crossing and
11   Wilson Yard in communities from coast to coast.
12            Now as I reflect on Bank of America's
13   acquisition of Countrywide, wearing my hat as a
14   member of the Chicago CRA Coalition Opportunity
15   Finance Network and the National Community
16   Reinvestment Coalition, precisely because it has
17   demonstrated such a high commitment to community
18   development and has the resources to do things in a
19   game changing way, CCLF stands with many of our
20   community colleagues and encouraging the bank to
21   take the following actions among many other
22   important recommendations, and we enlist the help
23   of the Federal Reserve in our effort.
24            We ask that the bank commit to
 1   aggressively modify problem Countrywide loans into
 2   30 year fixed rate products.
 3            While we salute the bank for its
 4   foundation of $35 million effort to work with
 5   community groups to prevent foreclosures and
 6   convert some units to rentals, we know that
 7   modifying Countrywide's problem loans will have a
 8   far greater impact.
 9            We ask that the bank commit to maintaining
10   staffing levels at Countrywide operations to
11   adequately hand the huge case load of problem
12   loans, not doing so could allow far too many hard
13   working American families to slip between the
14   cracks and into foreclosure.
15            Further we want to applaud Bank of America
16   for committing today that the combined company
17   would halt providing option ARMs, significantly
18   curtail low documentation lending, and limit
19   prepayment penalties.
20            We also encourage Bank of America to
21   proactively eliminate any fair lending practices
22   that it would inheret from Countrywide that are
23   under investigation at state and Federal levels.
24            Finally given how critical the combined
 1   company's home mortgage portfolio will lead to the
 2   stability of low wealth communities and indeed the
 3   nation's health, I support my colleagues' call for
 4   the bank to meet with community groups regularly to
 5   monitor and discuss progress and provide data on
 6   loan modifications, community investment, mortgage
 7   lending, and so forth.  Thank you.
 8       MS. BRAUNSTEIN:  Thank you very much.
 9   Ms. Aruguete.
10       MS. ARUGUETE:  My name is Joy Aruguete, and I'm
11   executive director of Bickerdike Redevelopment
12   Corporation, we're a 40 year old not-for-profit
13   community development corporation serving four
14   communities in the near northwest side of Chicago,
15   and we've produced about a thousand units of
16   affordable -- over a thousand units of affordable
17   housing over the last 40 years.
18            And we have a number of relationships with
19   Bank of America, they're the lender on one of our
20   projects.  We have several number of accounts with
21   them.  And we have certainly enjoyed their support
22   over the years.
23            One of the things that we've heard about
24   in the City of Chicago that we know about is that
 1   there is a foreclosure crisis underway which
 2   certainly Countrywide has not -- has been a -- has
 3   not engaged in lending practices which have avoided
 4   this crisis.
 5            We also know that there is a lack of
 6   rental housing that is needed in the City of
 7   Chicago that both has been in decline over the last
 8   decade, and there is projected to be a significant
 9   shortage, a growing shortage by the year 2020.
10            I think that our recommendations or my
11   recommendation for Bank of America in this
12   transaction is to create a product line which meets
13   the needs of Chicago's rental portfolio which has
14   been mid sized loans.
15            I think also to initiate a system to
16   transfer bank owned properties in Illinois to
17   municipalities and/or not for profit developers who
18   can rehab or recycle those homes into habitable and
19   affordable uses.
20            Also to initiate an immediate foreclosure
21   moratorium on all mortgage loans in the Countrywide
22   as well as Bank of America portfolio including
23   those that are currently being serviced.
24            And then to initiate a workout process for
 1   borrowers who are in danger of losing their homes,
 2   moving them to fixed interest rate products of no
 3   more than six percent and for no more than a 30
 4   year period.
 5            In addition, to meet semiannually with
 6   Chicago CRA Coalition and senior Bank of America
 7   community reinvestment, mortgage lending and retail
 8   staff to evaluate investment impacts and explore
 9   product adjustments.
10            And then, finally, to maintain or increase
11   the level of philanthropic giving through the bank
12   to the broader community development field.
13            Bank of America has played a strong role
14   in Chicago in the development of communities, and
15   we hope that it will broaden its reach and engage
16   in this acquisition responsibly and use it as an
17   opportunity to revitalize Chicago's communities.
18   Thank you for your attention.
19       MS. BRAUNSTEIN:  Thank you very much.
20   Mr. Sandos.
21       MR. SANDOS:  Thank you very much.  My name is
22   Tim Sandos, and I'm the president and chief
23   executive officer of the National Association of
24   Hispanic Real Estate Professionals, and I also
 1   wanted to add that I was formerly chair elect of
 2   the Omaha branch of the Kansas Federal Reserve
 3   Bank.  I love the institution, research you do, so
 4   I'm very happy to be able to be here in support of
 5   this merger.
 6            Those of you not familiar with NAHREP,
 7   we're an eight year old organization of 16,000
 8   members.  Our 63 chapters span 48 states.
 9            Last year we did $65 billion in
10   originations, it's approximately 25 percent of all
11   Hispanic lending in American has been touched by
12   our members.
13            So we're very proud of the growth and the
14   expansion that we have had in this community, and
15   it would not have occurred without the support of
16   Bank of America and Countrywide as two of our
17   original sponsors and supporters.
18            As a professional trade association, we
19   strike quite a balance.  Our mission statement is
20   to increase the sustainable Hispanic homeownership
21   grant, sustainable because we do no one any favors
22   putting them in the homes that they're going to
23   lose two to three years later, but we do that by
24   educating and supporting professionals who serve
 1   the market.
 2            They're the ones that they see on the
 3   street, the face before consumers, they're the ones
 4   who are going to make or break the success of those
 5   consumers when they move into the homes, and that's
 6   the area that we have specialized in.
 7            Now, the Hispanic community is very unique
 8   at this point in time.  We have a combination of
 9   the fastest growing population in the country, the
10   largest youth population between the age of 17 and
11   35 which are the greatest income earning years
12   before them.
13            They're a fast income growth, the largest
14   growth segment for the Hispanic community's income
15   level is $75,000 or more, so we're really hitting
16   now a swing in increase, and those combinations of
17   things create the opportunity for Hispanics to
18   really become the replacement to the baby boomers
19   to absorb some of the inventory that we're seeing
20   coming into REO or due to foreclosure.  And we
21   think that this merger will support the ability for
22   those things to happen.
23            The merger will result in combining the
24   industry's best known origination technology  that
 1   comes from Countrywide with the resources and
 2   extensive bank footprint the Bank of America
 3   provides.
 4            There is excellence in professional and
 5   consumer education that's really offered by both
 6   organizations and that have been providing those to
 7   us for all these eight years that we've been in
 8   existence.
 9            This is the kind of training that's going
10   to be essential to us being able to reestablish
11   trust and confidence in consumers out there, first
12   for consumers wanting to understand the valuations
13   and the right type of loan to be in and to be able
14   to recall professionals as trusted adversers that
15   are going the advise them in the right way.
16            Now, many of my members came into the
17   industry in the last five to seven years, they
18   don't understand how to handle loans other than the
19   huge volumes they have until now, and need to be
20   retrained, and it's Bank of America who have
21   stepped forward and provide that professional
22   training for us in so many different instances.
23            Countrywide has provided a myriad of
24   training for our members to understand how to
 1   develop active loan packages for consumers that are
 2   there.
 3            Both organizations, particularly
 4   Bank of America led the development of what we call
 5   en con bianza (phonetic).  It's the non-rev code of
 6   trust and set of ethical principals and standards
 7   by which we serve the community to ensure that they
 8   are not being dealt with as predators that have
 9   treated them in the past.
10            And I really want to emphasize that this
11   happened years before it became popular with
12   regulators or with legislators, we put our code of
13   trust into play.
14            Both organizations, Countrywide in
15   particular was a founding sponsor, they made a
16   commitment to the Hispanic community, again without
17   regulatory requirement but because they believed in
18   the opportunities for the community.
19            That meant a lot to professionals who are
20   trying to find ways to finance homes, and Bank of
21   America last year received a NAHREP's founders
22   award for leadership distinguished by the work that
23   they did with helping our members to successfully
24   place people in the homes.
 1            So you think -- don't think that we just
 2   lean to the industry side, our other recipient last
 3   year was ACORN, so you see, we run a pretty good
 4   gamut, we try to create the bridge between
 5   community and to the professionals and how we best
 6   serve the marketplace.
 7            Bank of America has created a regeneration
 8   program that we hope will be expanded when
 9   Countrywide comes in as a result of this
10   acquisition.
11            In the last two months of last year, well
12   over a thousand leads with better than 38 percent
13   of those leads converted into loans within a
14   two-month period, and this all put minority
15   homeowners into homes.
16            Lastly, Countrywide has entered into a
17   relationship with one of our members known as Asset
18   Management which is a company that's dedicated to
19   turning REO properties due to homeownership
20   opportunities for minorities, and the success rate
21   has been 78 percent of those homes going to owner
22   occupied homes all for minority buyers.
23            I thank you very much for the opportunity
24   to support this and look forward to any kind of
 1   questions you might have.
 2       MS. BRAUNSTEIN:  Thank you very much.
 3   Mr. Dougherty.
 4       MR. DOUGHERTY:  My name is Bob Dougherty, I'm
 5   the executive director of St. Leonard's Ministries.
 6            I think I'm here because I'm small
 7   potatoes in terms of my colleagues but, ladies, you
 8   know small potatoes add texture and taste to the
 9   soup.  I think that's what I'm to do.
10            St. Leonard's Ministries is a
11   not-for-profit, about 50 years old on the near west
12   side of Chicago.  We work with the particularly
13   marginalized population, and I think that's key to
14   what I would like to say.
15            We work with formerly incarcerated men and
16   women who exit prison and are trying to rebuild
17   their lives.
18            This is not an easy population with which
19   to work, this is not an easy population to bring to
20   a bank and ask for funding and get assistance, and
21   LaSalle/Bank of America has been extremely generous
22   with us over the years.
23            For a good long time in the history of
24   St. Leonard's, we worked with providing services
 1   for formerly incarcerated men and women.  When we
 2   got to the point where we needed to do housing, we
 3   knew that we needed help to do this, we couldn't do
 4   this by ourselves, and one of the main resources in
 5   terms of getting the assistance we needed was
 6   LaSalle Bank.
 7            We had no idea what a pro forma meant, we
 8   had no idea what another use of a red pen could be
 9   other than correcting things, so the staff at
10   LaSalle Bank and the people there were extremely
11   helpful to us.
12            Not only was there money made available to
13   us, but again it was this ongoing training that
14   helped us realize how to look at statements, how to
15   look at rental income, how to look at all the
16   components that go together for a successful
17   housing project.
18            So without their help I don't think we
19   would have been able to do this.  And again I would
20   like to stress that I can only assume that through
21   this merger that other small potatoes, other
22   nonprofit organizations and agencies would gain
23   from this continued sense of giving back to the
24   community at all levels.
 1            At the level that we're at, there isn't a
 2   lot of publicity, there isn't a lot of millions
 3   talked about, but there's a lot talked about in
 4   terms of rebuilding people's lives in returning
 5   that type of capital to the community, and we can
 6   only assume that this merger will further that.
 7            I would like to suggest one even smaller
 8   piece that's a big part of this.  When St.
 9   Leonard's Ministry celebrated it's 50th anniversary
10   a few minutes ago, LaSalle Bank was the one who
11   sponsored our whole event, and the mayor was on the
12   committee, and it was a big event for us, and we
13   couldn't have done it without the help of
14   LaSalle/Bank of America.
15            Those are small things, but communities
16   are built on small components, and I would like to
17   suggest that this can only be good for other
18   agencies such as our.  And I thank you.
19       MS. BRAUNSTEIN:  Thank you very much.
20   Mr. Markowski.
21       MR. MARKOWSKI:  Good afternoon.  I'm Jack
22   Markowski, president of Community Investment
23   Corporation or CIC for short.
24            On behalf of CIC, I am pleased to testify
 1   in support of Bank of America's proposed
 2   acquisition of Countrywide Financial Corporation.
 3            CIC is a not-for-profit corporation that
 4   is the Chicago area's leading multi family rehab
 5   lender.
 6            Since 1984, CIC has issued more than 1400
 7   loans for $855 million to acquire and rehabilitate
 8   more than 39,000 units of affordable rental housing
 9   throughout the six county Chicago regions.
10            We are capitalized by more than
11   $550 million in commitments from almost fifty
12   investors primarily composed of Chicago area banks
13   and thrifts.
14            Bank of America through its predecessor
15   institutions has been a major investor and
16   participant in CIC since our creation in the 1970s
17   and since the beginning of our multi family lending
18   in 1984.
19            Currently Bank of America is one of our
20   two major investors.  Its pledge of $126 million
21   represents more than 22 percent of our loan pool.
22   In addition to its financial investment, Bank of
23   America through its employees provides active
24   support and leadership for CIC.
 1            Two employees Gary Washington and Reinhart
 2   Schneider are long-time members of our fifteen
 3   member Board of Directors.
 4            Mr. Washington serves as chairman of the
 5   CIC board and Mr. Schneider is the immediate past
 6   chairman.
 7            Another Bank of America employee,
 8   Christine Germaux is a long standing member of
 9   CIC's loan committee which reviews and approves
10   individual loans and provides general oversight for
11   CIC's multi family lending activity.
12            In addition to Bank of America's
13   significant financial and personal participation in
14   the core business of CIC, we can attest to Bank of
15   America's role as a leader in addressing some of
16   the special challenges posed by today's mortgage
17   crisis which primarily affects single family
18   lending.
19            In Chicago one of the results of
20   foreclosures and the deterioration of the single
21   family for sale market is that many buildings which
22   were originally operated under single ownership as
23   viable multi family rental properties have failed
24   in their conversion to condominiums and now stand
 1   vacant and abandoned with multiple defaulted loans
 2   on individual condo units.
 3            At CIC we are attempting to re-assemble
 4   these failed condo conversions and restore them
 5   under single ownership as valuable parts of our
 6   rental housing stock.
 7            Alone among the many institutions that
 8   hold mortgages on failed condos, Bank of America
 9   has moved aggressively to resolve this complex
10   troubled situation.
11            Bank of America employees have been
12   accessible, responsive, and able to make decisions.
13   They have encouraged other financial institutions
14   to join them in restoring orderly ownership and
15   control to these buildings.
16            It is this kind of leadership that we
17   expect Bank of America to continue to exhibit in
18   resolving the difficult issues facing Countrywide.
19            For this and for their long standing
20   support and participation in the activities of CIC,
21   we support Bank of America's proposed acquisition
22   of Countrywide Financial Corporation.
23            Thank you for this opportunity to testify.
24       MS. BRAUNSTEIN:  Thank you very much.
 1   Questions for the panel?  All right.  Thank you
 2   very much.  I'm not sure, is our next panel here?
 3            Welcome.  Good afternoon.  Just to go over
 4   the brief housekeeping notes, we have time keepers
 5   right there and there's a little box with lights in
 6   front of it that will show you a yellow light when
 7   you have two minutes left and then a red light when
 8   you're finished.
 9            And the last thing is I would ask you to
10   please state your name and organization at the
11   beginning of your statement so that we can get it
12   on the record.
13            And so far today I've done really well
14   with names.  I'm going to start with Ms. Alnaqib.
15       MS. ALNAQIB:  Good afternoon.  My name is Susan
16   Longworth Alnaqib.  I'm co-president of Chicago
17   Community Ventures, and unlike many of the other
18   groups that have testified this afternoon, we focus
19   exclusively on smalll business development.
20            Also unlike many of my colleagues who have
21   testified today, we have a relatively new
22   relationship with Bank of America although have
23   enjoyed a very strong relationship with LaSalle
24   Bank and one that has supported us and stuck with
 1   us through some recent organizational transitions
 2   and for that we are extremely grateful.
 3            CCV is a Community Development Finance
 4   Institution and we provide financing and advisory
 5   services to small businesses located in Chicago's
 6   low and moderate income neighborhoods, those
 7   business are owned by minority or women.
 8            Our mandated is to provide small business
 9   owners with the resources they need to grow to
10   access capital and create jobs in the communities
11   we serve.
12            At CDFI we have approximately $7.5 million
13   under management in our loan fund and through a
14   small business loan fund which we manage for the
15   City of Chicago.
16            Our loan amounts are in amounts of $25,000
17   to $250,000 seeking to fill the capital gap that
18   many business owners face after they have exhausted
19   all microfinance and other options.
20            We work with those clients who will some
21   technical assistance and time will develop into
22   viable candidates for additional financing.  We
23   make every effort to secure bank financing for our
24   clients knowing that they will benefit from better
 1   rates and products than we can offer.
 2            Like everyone who has presented today,
 3   none of our successes have been accomplished alone,
 4   we rely heavily on partnerships to achieve our
 5   impact.
 6            We are members of the Opportunity Finance
 7   Network, and operate contracts for the U.S.
 8   Department of Commerce Minority Business
 9   Development Agency as well as for the SBA, the
10   Illinois Department of Commerce and Economic
11   Opportunity, and our City of Chicago delegate
12   agency.
13            Chicago's numerous community development
14   organizations, academic centers, financial
15   institutions including Bank of America round out a
16   portfolio relationship we bring to bear to meet the
17   various needs of our clients.
18             Over the past five years, we have
19   channeled over $178 million to the businesses and
20   communities we serve.  Over 50 percent of this has
21   been in excess to capital.  We've also created or
22   retained almost 5,000 jobs.
23            While our clients cut across all
24   industries and represent all stages in the life
 1   cycle of business, the majority of our clients have
 2   over $250,000 in revenue, employ more than five
 3   people and have more than two businesses.
 4            There are also other commonalities.  Like
 5   many small business owners, their personal home is
 6   their primary and often only asset, and the value
 7   of that asset is intrinsically related to their
 8   ability to obtain financing but will enable them to
 9   grow their business and create jobs for the members
10   of their community.
11            If that underlying asset is compromised
12   and that expansion may not happen, those jobs will
13   not be created.
14            We are aware every day that in the
15   communities we serve, over 90 percent of businesses
16   are small businesses, and those small businesses
17   create 80 percent of new jobs.
18            As I mentioned earlier we're in the
19   process of expanding our relationship with Bank of
20   America, building on a multifaceted relationship
21   with LaSalle Bank.
22            This has included board representation and
23   investment in our loan fund, annual charitable
24   contributions, and an important role of repository
 1   for the loan funding management with the City of
 2   Chicago.
 3            Bank of America has invited and is
 4   currently reviewing a grant application from us,
 5   and we also recently met with a representative from
 6   their program related to investment team.
 7            We are encouraged by their strong CRA
 8   commitment and look forward to working together to
 9   build strong communities through homeownership and
10   business ownership alike and as a result support
11   the proposed merger.  Thank you.
12       MS. BRAUNSTEIN:  Thank you very much.
13   Mr. Geer.
14       MR. GEER:  Good afternoon.  My name is Andrew
15   Geer, I'm the executive director of Heartland
16   Housing, it's the housing partner of the Heartland
17   Alliance for Human Needs and Human Rights.  We work
18   to provide a safe and decent home for all
19   individuals and families impacted by homelessness
20   and poverty.
21            As one of the lead organizations involved
22   in the relocation of Katrina evacuees in Chicago,
23   we saw firsthand the devastation created by the
24   displacement of families from their communities and
 1   homes.
 2            We understand the benefits of timely
 3   intervention and will place support in assisting
 4   families in a successful relocation to stable
 5   housing.
 6            The cost to society is great when families
 7   are left to their own means in making this
 8   transition.
 9            As we look at the foreclosure crisis we
10   are already beginning to sees the impact on our
11   services in our communities are families are
12   displaced from their homes.
13            We believe that foreclosure prevention is
14   one key aspect to address this crisis.  We
15   encourage Bank of America to take leadership around
16   the issue of displacement of vacant buildings as
17   they look to acquire Countrywide.
18            As such we propose that Bank of America
19   adhere to the following principles as part of its
20   acquisition of Countrywide.
21            Support the work of nonprofits to engage
22   families that are displaced due to the foreclosure
23   and loss of their home.
24            As families leave their homes and into
 1   rental housing, they will be confronted with the
 2   affordable housing crisis.  In addition families
 3   will have to repair bad credit to enter rental
 4   housing, support will be needed in helping families
 5   make this transition.
 6            Support the creation of an acquisition
 7   fund to help nonprofit organizations acquire
 8   managed foreclosed properties which will help
 9   stabilize the neighborhoods in which we work.
10            Build the capacity of local organizations
11   to manage properties acquired through foreclosure,
12   ensure that they are maintained as community
13   assets.  We see property management as a key
14   cornerstone for a foreclosure prevention strategy
15   and we feel that we have to work to build capacity
16   of organizations to deal with this issue.
17            Work with local providers to remove the
18   barriers in negotiating with loan servicers around
19   the acquisition and disposition of foreclosed
20   properties.
21            Heartland Alliance has been a strong
22   beneficiary of support from both LaSalle and from
23   Bank of America, and we believe that the
24   acquisition of Countrywide needs to be put into the
 1   hands of a good community steward, and we have a
 2   strong relationship with Bank of America and
 3   LaSalle, and we've been encouraged by the
 4   discussions that we've had with them around these
 5   issues, around the foreclosure issues.
 6            As a member of the Chicago Rehab Network
 7   I'm also involved in some of those discussions and
 8   are in support of that, of the directions and ideas
 9   that Bank of America has taken in their leadership.
10            So I encourage them to maintain that
11   leadership as they move forward with these
12   discussions and to maintain a focus on not only the
13   individuals -- on the assets that are parts of
14   these communities but also the individuals.  Thank
15   you for this opportunity to provide testimony.
16       MS. BRAUNSTEIN:  Thank you very have.
17   Mr. Pinsky.
18       MR. PINSKY:  Thank you.  Good afternoon.  It's
19   good to be here.
20            I am Mark Pinsky, president and CEO of
21   Opportunity Finance Network, the nation's leading
22   network of Community Development Financial
23   Institutions.  You've had the good fortune to hear
24   from several of us today I think.
 1            CDFI is a private sector financial
 2   institution that lends and invests in all 50 states
 3   to benefit low income and low wealth people,
 4   communities, and markets.  We work in urban, rural,
 5   and reservation based places.
 6            We lend and invest outside the margins of
 7   conventional finance to help the people of markets
 8   we serve enter the economic the mainstream and help
 9   mainstream institutions discover these opportunity
10   markets.
11            Our industry has financed more than
12   $25 billion in opportunity markets for more than 30
13   years.  Our net charge operates cumulatively are
14   less than one percent, comparable to mainstream
15   financial institutions working more conventional
16   markets that are generally thought to present less
17   risk.
18            In addition I should note that I'm
19   chairman of the Opportunity Mortgage Network, an
20   affiliate of Opportunity Finance Network that has
21   offered responsible mortgage products in the places
22   where CFI has covered.
23            I've submitted some written testimony, so
24   I'm going to excerpt from that today just to keep
 1   it brief, and I want to make four points.
 2            First, I want to say if there's a single
 3   lesson that the Opportunity Finance Network has
 4   learned through our experience and proven through
 5   our practice, it is this, it is possible to lend
 6   responsibly and profitably and not performing in
 7   subprime markets.
 8            It is a matter of discipline and thought
 9   and practice coupled with a commitment to producing
10   sustainable gains for communities, markets,
11   financial intermediaries, and investors.
12            Second, I am confident and satisfied Bank
13   of America's purchase of Countrywide would be a
14   significant positive step.
15            Bank of America's approach to mortgage
16   lending is fundamentally responsible.
17   Countrywide's approach was fundamentally
18   irresponsible.
19            Bank of America's mortgage business was
20   and is based on sound underwriting and credit
21   principles and practices, Countrywide's was not.
22            Bringing the Countrywide mortgage business
23   within Bank of America seems certain to result in a
24   much more disciplined and responsible practice of
 1   providing mortgage credit.
 2            As a result the acquisition seems likely
 3   to provide a little more stability than we see
 4   today in the credit and financial markets and so I
 5   would hope in the economy.
 6            Third, Opportunity Finance Network has
 7   experienced firsthand the discipline Bank of
 8   America practices in its credit business.
 9            In 2006, OFM borrowed $10 million from
10   Bank of America for the purpose of providing
11   liquidity to some of the financial institutions in
12   our CDFI network who lend small businesses and
13   enterprises, particularly microenterprises.
14            In our experience Bank of America is
15   innovative, aggressive, and effective in serving
16   those markets.
17            Bank of America's underwriting of OFN was
18   thorough and rigorous.  It's monitoring has been
19   comprehensive and respectful in its focus on
20   benefiting the low income income and low level
21   people OFN exists to serve has been consistent and
22   unrelenting.
23            The $10 million relationship has been
24   successful.  We have so far loaned $9 million that
 1   our network, CDFI -- that CDFI's have in turn
 2   reloaned to small businesses and microenterprises.
 3            Because of the favorable terms and
 4   conditions Bank of America provided and because
 5   they approached this as a serious business
 6   activity, we are able to serve more customers over
 7   a long period than we would otherwise have served.
 8            Fourth and finally, in my view Bank of
 9   America is proposing to take on with its purchase
10   of Countrywide a special responsibility to look
11   after Countrywide's customer to improve the well
12   being of the mortgage market and to help restore
13   safety and soundness to financial markets.
14            These are deeply troubling times for
15   homeowners, mortgage lenders, and financial
16   institutions.
17            The market is looking for direction, and I
18   call on Bank of America to help provide it.  If I
19   did not think Bank of America were up to this
20   challenge and committed to meeting the high
21   standard of responsibility, I would not be
22   testifying today in support of the proposed
23   purchase.
24            It would not be enough in my opinion for
 1   Bank of America simply to cease and desist from
 2   some of the irresponsible lending activities that
 3   lead to Countrywide's problems.
 4            Bank of America should make extraordinary
 5   efforts to work our loans that are in or near
 6   foreclosures so that homeowners can remain
 7   homeowners, should aggressively support credit
 8   counseling agencies and homeownership counselors,
 9   not just now but for decades to come.
10            Bank of America should continue to support
11   on the ground community development advocates and
12   organizations that provide vital channels to low
13   income and low level borrowers.
14            And finally Bank of America should do
15   everything possible to leave the mainstream
16   financial system in responsible manner.  Thank you
17   for the opportunity to speak.
18       MS. BRAUNSTEIN:  Thank you very much.  Any
19   questions?  Okay.
20            Thank you very much for your testimony.
21   Do you want to bring the next speakers up.
22            Okay.  Our time keepers are right there,
23   we'll signal you when you have two minutes left of
24   your time, and I would ask that each of you start
 1   your statement by stating your name and your
 2   organization so we can get it on the record.  And
 3   we'll start with Mr. Jourdain-Earl.
 4       MR. JOURDAIN-EARL:  Okay.  Good afternoon.  My
 5   name is Maurice Jourdain-Earl.  I am actually
 6   representing two organizations, one my company
 7   which is Compliance Technologies and a nonprofit
 8   organization that we formed Lending Industry
 9   Diversity Conference, Inc., and we're based in
10   Washington, D.C..
11            I am here in support of the acquisition of
12   Countrywide, but let me first tell a little bit
13   about Compliance Technologies and about Lending
14   Industry Diversity Conference.
15            Compliance Tech was formed in 1992, and we
16   provide specialized lending intelligent services to
17   financial institutions nationwide, including in
18   that mix there was some information for regulators
19   and nonprofit organizations.
20            Our team is multidisciplined in areas of
21   lending, research, statistical analysis, law and
22   economics, and what makes us unique is that we
23   implement our multidisciplinary approach by
24   exploring novel data driven technologies.
 1            Our motto is all lenders are not alike.
 2   This says that we recognize cookie cutter
 3   approaches to strategic markets, CRA, fair lending
 4   and low and moderate income lending are unlikely to
 5   work, therefore, we pride ourselves in taking the
 6   data and to the facts of the data to uncover
 7   specific lending opportunities, systemic
 8   operational impediments to success, and hidden
 9   origination and compliance failure risk.
10            With that said we were the first company
11   in the country to develop software to detect
12   discrimination in lending.
13            That system is in play in a number of
14   different financial institutions around the country
15   including some Federal bank regulators.
16             The Lending Industry Diversity Conference
17   was formed four years ago as a nonprofit D.C. based
18   corporation organized for the following purposes:
19            One, conducting conferences to promote the
20   link between racial and ethnic diversity in the
21   work force and racial and ethnic diversity in
22   lending and credit applications.
23            Increasing the racial and ethnic diversity
24   of the work force and suppliers in all lending and
 1   credit granting sectors.
 2            And then finally research and publicizing
 3   ways to capitalize on racial and ethnic diversity
 4   as a mechanism to increase minority loan
 5   originations.
 6            We are conducting our fourth annual
 7   Lending Industry Diversity Conference, strategic
 8   markets and diversity conference in October of this
 9   year in Washington, D.C.
10            Bank of America has been one of our
11   staunchest supporters.  They have been a gold
12   sponsor of this conference every year, and not only
13   have they sponsored in terms of dollars, but also
14   in terms of their effort to make the conference a
15   success.
16            The conference literally has become the
17   forum to talk about issues of race and lending in
18   the United States.
19            We are a joined at the conference by a --
20   our co-event sponsors are January Financial and the
21   Mortgage Bankers Association of America.  Our
22   corporate sponsors, Bank of America has been again
23   one of our staunch supporters in that they have
24   helped us to make the conference a success.
 1            More importantly, though, we have a
 2   minority lending awards dinner where we use the
 3   HMDA data to analyze the lending performance of
 4   every lender in the country to make certain awards.
 5            In 2004 and 2005, Bank of America won the
 6   minority lending penetration award two years
 7   straight.  The third year, 2007, we did the award
 8   based upon lender's regulatory peer groups.
 9            Bank of America won the minority lending
10   award for the OCC regulatory peer group, and in
11   that year, there were 630,000 minority loans made
12   by the OCC regulating institutions, Bank of America
13   made 120,000 or 19 percent of that total.
14            Mind you, we don't include subprime rate
15   loans in any of the analytics that we use to decide
16   who the award winners are.
17            With that said, Countrywide not including
18   any of the subprime loans was the number one
19   minority lender in the United States.
20            When this acquisition takes place, it is
21   likely that Bank of America will be the number one
22   minority lender in the United States bar none.
23            With that comes a huge responsibility,
24   one, a huge responsibility to, one, continue to
 1   lend to people of color in a way that is affordable
 2   and sustainable.
 3            Bank of America through their efforts we
 4   know had that as a model.  Clearly with this
 5   acquisition they will inherent some challenges and
 6   those challenges will need to be met head on,
 7   otherwise we will see some slippage, we will see
 8   slippage of loans made to African Americans,
 9   Latinos, Asians, and other people of color in this
10   country.
11            And so I say that it is important that the
12   acquisition takes place largely because it will
13   become the platform from which many people in this
14   country will be able to sustain homeownership, and
15   we can reduce this gap in homeownership rates in
16   this country.  Thank you.
17       MS. BRAUNSTEIN:  Thank you very much.
18   Ms. Holler.
19       MS. HOLLER:  My name is Cindy Holler, I'm the
20   president of Mercy Housing Lakefront which is based
21   here in Chicago and works in the midwest region.
22            I'm part of the larger Mercy Housing which
23   is based in Denver, it has local offices in many of
24   the places where Bank of America is active.
 1            I want to preface my remarks by saying
 2   it's Mercy Housing's policy never to weigh in on
 3   whether mergers work or don't work because we don't
 4   feel that we have enough to deal with that you all
 5   have in order to make determinations like that.
 6            Having said that we do believe very
 7   strongly in the good work that Bank of America
 8   does, has done with us, and we want to support
 9   their business strategy whenever we can.
10            I want to say that I have a unique
11   perspective on Bank of America personally having
12   worked for seven years at Fannie Mae making real
13   estate investments around the country.  We worked
14   very hard to steel everything we could from Bank of
15   America ideas about doing that because they were so
16   good at that.
17            I admire them profusely as it comes to
18   community development, they've done some fabulous
19   things around the country and I've really been able
20   to see that work, and we were luckily enough to
21   recruit some of their staff to come to Fannie Mae
22   and teach us how to do it as well.
23            So having them have a larger presence here
24   in Chicago for me personally is very exciting
 1   because I think there's a lot they can -- they have
 2   learned nationally that they also are not afraid in
 3   any instance to bring locally.
 4            I've probably not seen another institution
 5   that can work both nationally and locally as well
 6   as they can, they've very nimble about that, and
 7   that's very difficult to do as somebody who worked
 8   nationally at Fannie Mae on a retail basis and a
 9   wholesale basis.
10            I want to just say several other things,
11   from a philanthropic perspective, we found
12   nationally at Mercy and locally that Bank of
13   America has always been a good partner of ours, and
14   they've given us over millions of dollars over the
15   years to try out new things in local markets and
16   experiment, and the support is very much
17   appreciated.
18            They have been very supportive of allowing
19   their in-house personnel to volunteer on our boards
20   of directors across the country including here in
21   Chicago, and we have found them to be active
22   leaders on our boards in helping us shape the
23   future of the rental market in the United States.
24            Just by way of background, Mercy Housing
 1   nationally owns and manages about 19,000 units of
 2   housing across the country.  We're based in
 3   San Francisco, Sacramento, L.A., Denver, Chicago,
 4   and Atlanta.
 5            Here in Chicago we largely own, manage,
 6   and develop housing for low income families and for
 7   homeless individuals, and the kind of leadership
 8   that Bank of America has shown to us in thinking
 9   through how we continue to serve those markets at
10   scale has been inspiring.
11            I would also want to say a little bit
12   about their products.  I found, and I'm very
13   familiar with all the lending products offered in
14   the local marketplace by local lenders based upon
15   my experience with Fannie Mae.
16            I've found Bank of America's products to
17   be much more innovative.  They would think about
18   things like entity level PRIs as opposed to project
19   based PRIs which I think is starting to recognize
20   that capital to large and regional not-for-profits
21   that want to start to fill the housing gap are --
22   requires that kind of investment, and they've been
23   leaders in that.  And I've not seen any other
24   institution take a step out in the same way that
 1   Bank of America has.
 2            I would just want to finalize my comments
 3   by saying having witnessed the LaSalle/Bank of
 4   America merger, we found that two plus two really
 5   did equal five in this case.
 6            LaSalle and Bank of America when they
 7   merged here, we found that the philanthropy did not
 8   stop, it increased, and the innovation and the
 9   ideas that were put on the table locally here in
10   Chicago got bigger, not smaller.
11            So just as a Chicago citizen and one that
12   runs a large not-for-profit here, I'm thrilled to
13   see Bank of America in this market.
14       MS. BRAUNSTEIN:  Thank you very much.  Any
15   questions?  Thank you very much for your testimony.
16   And we have one more speaker.  I would assume
17   you're Ms. McDaniel.
18       MS. MC DANIEL:  Yes, I am.  I didn't realize
19   you were running ahead of schedule.  Thank you.
20       MS. BRAUNSTEIN:  You were the only female left
21   on the list, so I was making the assumption.
22       MS. MC DANIEL:  Good guess.
23       MS. BRAUNSTEIN:  We have time keepers here,
24   just so you know, that will signal you when you
 1   have two minutes left and the yellow light will go
 2   on, and then they'll signal you when the time is
 3   up.
 4            And, please, when you begin your statement
 5   state your name and your organization.
 6       MS. MC DANIEL:   Yes.  Absolutely.  My name is
 7   Melissa McDaniel, and I'm the executive director of
 8   North River Commission.
 9            North River Commission is a 46 year old
10   nonprofit community based organization working on
11   the northwest side.
12            Our boundaries run from Devon Avenue on
13   the north, Addison on the south, Chicago River on
14   the east, and Cicero on the west, and I would just
15   like to start by saying that, you know, we've had a
16   historical and current relationship with Bank of
17   America really in supporting our work in two
18   different areas that we work in, both economic
19   development and housing, and obviously for today's
20   purposes I was going to talk briefly about some of
21   the work that we've done with them in housing.
22            Historically when Bankers Life was leaving
23   the Mayfair area and was taking hundreds of jobs
24   with them and leaving several commercial vacant
 1   spaces in our community, Bank of America really got
 2   behind us to develop a comprehensive commercial
 3   redevelopment plan for how to use those spaces and
 4   how to bring jobs back in the community including
 5   one of the pieces that we've used primarily  was to
 6   develop an affordable senior housing project.
 7            It was a $10 million project with 97 units
 8   for senior housing.  It still currently stands at
 9   4444 West Lawrence which we partially own as
10   stakeholders, and that was a really important piece
11   for this community that was losing such a large
12   investment was figuring out how we can help to
13   bring businesses back to the area and how we can
14   make sure that we have a strong housing stock and
15   support the current seniors that live in the
16   community.
17            Also, you know, in today's trend, Bank of
18   America has stepped up to the plate to help support
19   our efforts in housing for really three different
20   areas of affordable housing.
21            The first has been the preservation of
22   subsidized senior housing in our communities.  We
23   have six senior buildings in our neighborhoods that
24   are Section 8 project based buildings and they have
 1   worked to support us to preserve those as well as
 2   working with landlords to identify the barriers to
 3   creating affordable housing and helping them
 4   preserve quality rentals in our neighborhoods which
 5   we have increasingly seen a decrease in as many
 6   condo conversations having taken place over the
 7   past eight years.
 8            We've actually lost 15 percent of our
 9   rental units between 2000 and 2005, and I would say
10   at least another 5 to 10 percent in the last three
11   years, so that piece has really been crucial in
12   helping to make sure that we have a balanced mix of
13   housing that serves both low to moderate income
14   families as well as wealthier families in our
15   neighborhood.
16            And really the third piece has been to
17   look at the ways that we can create and to preserve
18   affordable housing in our neighborhood for low
19   income immigrant and refugee families which
20   primarily make up the community of Albany Park.
21            We have 40 major languages spoken in our
22   community, 127 ethnicities and there's a great
23   need.  And so they have really come to support
24   North River Commission and our organization in
 1   these efforts, and we owe them a debt of gratitude,
 2   our community, the support that they've given us,
 3   and the organization and the businesses and
 4   residents, it's making our community a better place
 5   to live and work.
 6       MS. BRAUNSTEIN:  Okay.  Thank you very much.
 7       MS. MC DANIEL:  Do you have any questions?
 8       MS. BRAUNSTEIN:  No questions.
 9       MS. MC DANIEL:  Okay.  Thank you.
10       MS. BRAUNSTEIN:  Okay.  That seems like we had
11   a couple speakers that did not show, and so no one
12   signed up for the open mike, I'll give one last
13   chance if anybody has anything else they want to
14   say, and if not we'll consider this public meeting
15   adjourned and we will see some of you in
16   Los Angeles next week.
17            And I want to first before I officially
18   adjourn this just to thank everyone for your
19   testimony today, and I would also very much like to
20   extend very strong thanks from all of us to the
21   Federal Reserve Bank of Chicago and to Alicia
22   Williams and her staff for hosting us today and
23   doing such a wonderful job in that and doing the
24   time keeping and Steve for running back and forth
 1   and doing a lot of organizing this.  And thanks to
 2   all of you, and with that we will adjourn.
 3                           (Which were all proceedings
 4                           had in the above-entitled
 5                           cause.)
 2                        )   SS:
 3   COUNTY OF C O O K    )
 4       Susan Maul, being first duly sworn, on oath
 5   says that she is a court reporter doing business in
 6   the City of Chicago; and she reported in shorthand
 7   the testimony given in the hearing of said cause,
 8   and that the foregoing is a true and correct
 9   transcript of her shorthand notes so taken as
10   aforesaid.
13                      ______________________________
14                      CSR
17   before me this _ _ _ day
18   of _ _ _ _ _, A. D., 2008.
20   _ _ _ _ _ _ _ _ _ _ _ _ _
21         Notary Public
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Last Update: March 15, 2017