FEDERAL RESERVE SYSTEM 

Fifth Third Bancorp 

Cincinnati, Ohio 

Fifth Third Financial Corporation 

Cincinnati, Ohio 

Fifth Third Bank 

Grand Rapids, Michigan 

Order Approving the Acquisition of a Bank Holding Company, 

Merger of Banks, and Establishment of Branches 

Fifth Third Bancorp and its wholly owned subsidiary, Fifth Third 

Financial Corporation (collectively “Fifth Third”), both financial holding companies 

within the meaning of the Bank Holding Company Act (“BHC Act”), have 

requested the Board’s approval under section 3 of the BHC Act1

 to acquire 

First National Bankshares of Florida, Inc. (“First National”) and its wholly owned 

subsidiary, First National Bank of Florida (“First National Bank”), both in 

Naples, Florida.2

 In addition, Fifth Third’s subsidiary bank, Fifth Third Bank, 

Grand Rapids, Michigan (“Fifth Third Bank”), a state member bank, has requested 

the Board’s approval under section 18(c) of the Federal Deposit Insurance Act3

(“Bank Merger Act”) to merge with First National Bank, with Fifth Third Bank as 

 

1

 12 U.S.C. § 1842. 

2

 Fifth Third’s other subsidiary depository institutions are Fifth Third Bank, 

Cincinnati, Ohio (“Fifth Third Ohio”), and Fifth Third Bank, N.A., Franklin, 

Tennessee (“Fifth Third, N.A.”). 

3

 12 U.S.C. § 1828(c).
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the surviving entity.4

 Fifth Third Bank also has requested the Board’s approval 

under section 9 of the Federal Reserve Act5

 (“FRA”) to retain and operate branches 

at the locations of First National Bank’s main office and branches.6

 

 Notice of the proposal, affording interested persons an opportunity to 

comment, has been published in the Federal Register (69 Federal Register 59,597 

(2004)) and locally in accordance with the relevant statutes and the Board’s Rules of 

Procedure.7

 As required by the BHC Act and the Bank Merger Act, reports on the 

competitive effects of the merger were requested from the United States Attorney 

General and the appropriate federal banking agencies. The time for filing comments 

has expired, and the Board has considered the applications and all comments 

received in light of the factors set forth in section 3 of the BHC Act, the Bank 

Merger Act, and the FRA. 

Fifth Third, with total consolidated assets of approximately 

$98.3 billion, is the 16th largest depository organization in the United States. 

Fifth Third operates subsidiary depository institutions in Florida, Illinois, Indiana, 

Kentucky, Michigan, Ohio, Tennessee, and West Virginia. Fifth Third Bank is the 

38th largest depository institution in Florida, controlling deposits of approximately 

 

4

 Under the proposal, Fifth Third would acquire all the issued and outstanding 

stock of First National. Simultaneously with the acquisition of First National’s 

stock, First National would merge with and into Fifth Third, and First National 

Bank would merge with and into Fifth Third Bank. Fifth Third proposes to 

acquire First National’s nonbanking subsidiaries and engage only in activities 

listed in section 4(k)(4)(A)-(H) of the BHC Act, pursuant to section 4(k) and 

the post-transaction notice procedures of section 225.87 of Regulation Y. 

12 U.S.C. § 1843(k)(4)(A)-(H); 12 C.F.R. 225.87. 

5

 12 U.S.C. § 321. 

6

 These branches are listed in Appendix A. 

7

 12 C.F.R. 262.3(b).
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$820.1 million.8

 First National, with total consolidated assets of approximately 

$5.5 billion is the 12th largest depository organization in Florida, controlling 

deposits of approximately $3.9 billion. On consummation of the proposal, 

Fifth Third would become the 15th largest depository organization in the 

United States and Fifth Third Bank would become the tenth largest depository 

institution in Florida, controlling deposits of approximately $4.7 billion, which 

represent approximately 1.7 percent of the total amount of deposits of insured 

depository institutions in the state.9

 

Interstate Analysis

 Section 3(d) of the BHC Act allows the Board to approve an 

application by a bank holding company to acquire control of a bank located in a 

state other than the home state of the bank holding company if certain conditions 

are met. Section 44 of the Federal Deposit Insurance Act10 (“FDI Act”) authorizes 

a bank to merge with another bank under certain conditions unless, before 

June 1, 1997, the home state of one of the banks involved in the transaction adopted 

a law expressly prohibiting merger transactions involving out-of-state banks.11 For 

purposes of the BHC Act, the home state of Fifth Third is Ohio,12 and for purposes 

 

8

 Asset data and national rankings are as of September 30, 2004. Deposit data and 

state rankings are as of June 30, 2004, and are adjusted to reflect mergers and 

acquisitions completed through December 8, 2004. 

9

 In this context, the term “insured depository institutions” includes insured 

commercial banks, savings banks, and savings associations. 

10 12 U.S.C. § 1831u. 

11 Pub. L. No. 103-328, 108 Stat. 2338 (1994); see 12 U.S.C. § 1831u. 

12 Under section 3(d) of the BHC Act, a bank holding company’s home state is the 

state in which the total deposits of all banking subsidiaries of such company were 

the largest on July 1, 1966, or the date on which the company became a bank 

holding company, whichever is later. 12 U.S.C. § 1842(d). Under section 44 of 
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of section 44 of the FDI Act, the home state of Fifth Third Bank is Michigan. 

Fifth Third proposes to acquire a bank in Florida.13 

 Based on a review of all the facts of record, including a review of 

relevant state statutes, the Board finds that all conditions for an interstate acquisition 

and bank merger enumerated in section 3(d) of the BHC Act and section 44 of the 

FDI Act are met in this case.14 In light of all the facts of record, the Board is 

permitted to approve the proposal under section 3(d) of the BHC Act and section 44 

of the FDI Act. 

Competitive Considerations

 Section 3 of the BHC Act and the Bank Merger Act prohibit the Board 

from approving a proposal that would result in a monopoly or would be in 

furtherance of an attempt to monopolize the business of banking. The BHC Act and 

the Bank Merger Act also prohibit the Board from approving a bank acquisition that 

would substantially lessen competition in any relevant banking market unless the 

anticompetitive effects of the proposal are clearly outweighed in the public interest 

 

the FDI Act, a state member bank’s home state is the state where it is chartered. 

12 U.S.C. § 1831u(g)(4). 

13 For purposes of section 3(d), the Board considers a bank to be located in 

states in which the bank is chartered or headquartered or operates a branch. 

See 12 U.S.C. §§ 1841(o)(4)-(7) and 1842(d)(1)(A) & (d)(2)(B). 

14 12 U.S.C. § 1842(d)(1)(A) & (B), 1842(d)(2)(A) & (B); 12 U.S.C. § 1831u. 

Fifth Third and Fifth Third Bank are well capitalized and well managed, as defined 

by applicable law. First National Bank has been in existence and operated for the 

minimum period of time required by Florida law. On consummation of the 

proposal, Fifth Third and Fifth Third Bank would control less than 10 percent of the 

total amount of deposits of insured depository institutions in the United States and 

less than 30 percent of the total amount of deposits of insured depository institutions 

in Florida. See Fla. Stat. ch. 658.295(8)(b) (2004). All other requirements under 

section 3(d) of the BHC Act and section 44 of the FDI Act also would be met on 

consummation of the proposal.
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by the probable effect of the proposal in meeting the convenience and needs of the 

community to be served.15 

 Fifth Third Bank and First National Bank compete directly in the 

Naples, Fort Myers, and Sarasota banking markets in Florida.16 The Board has 

reviewed carefully the competitive effects of the proposal in each of these banking 

markets in light of all the facts of record. In particular, the Board has considered the 

number of competitors that would remain in the markets, the relative shares of total 

deposits of depository institutions in the markets (“market deposits”) controlled by 

Fifth Third Bank and First National Bank,17 the concentration level of market 

deposits and the increase in this level as measured by the Herfindahl-Hirschman 

Index (“HHI”) under the Department of Justice Merger Guidelines 

(“DOJ Guidelines”),18 and other characteristics of the market. 

 

15 12 U.S.C. § 1842(c)(1); 12 U.S.C. § 1828(c)(5). 

16 These banking markets are described in Appendix B. 

17 Deposit and market share data are as of June 30, 2004, adjusted to reflect 

subsequent mergers and acquisitions through December 8, 2004, and are based 

on calculations in which the deposits of thrift institutions are included at 

50 percent. The Board previously has indicated that thrift institutions have 

become, or have the potential to become, significant competitors of commercial 

banks. See, e.g., Midwest Financial Group, 75 Federal Reserve Bulletin 386 (1989); 

National City Corporation, 70 Federal Reserve Bulletin 743 (1984). Thus, the 

Board regularly has included thrift deposits in the market share calculation on a 

50 percent weighted basis. See, e.g., First Hawaiian, Inc., 77 Federal Reserve 

Bulletin 52 (1991). 

18 Under the DOJ Guidelines, a market is considered unconcentrated if the 

post-merger HHI is less than 1000 and moderately concentrated if the post-merger 

HHI is between 1000 and 1800. The Department of Justice has informed the Board 

that a bank merger or acquisition generally will not be challenged (in the absence 

of other factors indicating anticompetitive effects) unless the post-merger HHI is 

at least 1800 and the merger increases the HHI by more than 200 points. The 

Department of Justice has stated that the higher than normal HHI thresholds for 
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 Consummation of the proposal would be consistent with Board 

precedent and the DOJ Guidelines in each of these banking markets.19 After 

consummation, the Naples, Fort Myers, and Sarasota banking markets would remain 

moderately concentrated, with only modest increases in market concentration as 

measured by the HHI. Numerous competitors would remain in all these banking 

markets. 

 The Department of Justice has also conducted a detailed review of the 

anticipated competitive effects of the proposal and has advised the Board that 

consummation of the proposal would not likely have a significantly adverse effect 

on competition in any relevant banking market. In addition, the appropriate banking 

agencies have been afforded an opportunity to comment and have not objected to 

the proposal. 

 Based on all the facts of record, the Board concludes that 

consummation of the proposal would not have a significantly adverse effect on 

competition or on the concentration of resources in any of the three banking markets 

in which Fifth Third and First National directly compete or in any other relevant 

banking market. Accordingly, based on all the facts of record, the Board has 

determined that competitive considerations are consistent with approval. 

Financial and Managerial Resources and Future Prospects

 The BHC Act and the Bank Merger Act require the Board to consider 

the financial and managerial resources and future prospects of the companies and 

banks involved in the proposal and to consider certain other supervisory factors 

 

screening bank mergers for anticompetitive effects implicitly recognize the 

competitive effects of limited-purpose lenders and other nondepository financial 

institutions. 

19 The effects of the proposal on the concentration of banking resources in these 

banking markets are described in Appendix C.
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under the BHC Act. The Board has carefully considered these factors in light of all 

the facts of record including, among other things, information provided by 

Fifth Third, confidential reports of examination and other supervisory information 

received from the federal and state banking supervisors of the organizations 

involved, publicly reported and other financial information, and public comments 

received on the proposal. 

In evaluating financial factors in expansion proposals by banking 

organizations, the Board reviews the financial condition of the organizations 

involved on both a parent-only and consolidated basis, as well as the financial 

condition of the subsidiary banks and significant nonbanking operations. In this 

evaluation, the Board considers a variety of areas, including capital adequacy, asset 

quality, and earnings performance. In assessing financial factors, the Board 

consistently has considered capital adequacy to be especially important. The Board 

also evaluates the effect of the transaction on the financial condition of the applicant 

and the target, including their capital positions, asset quality, and earnings prospects 

and the impact of the proposed funding of the transaction. 

Based on its review of these factors, the Board finds that Fifth Third 

has sufficient financial resources to effect the proposal. Fifth Third and its 

subsidiary banks are well capitalized and would remain so on consummation of this 

proposal. The proposed transaction is structured as a share exchange, and the cash 

consideration in lieu of fractional shares will be funded from Fifth Third’s existing 

resources.20 

 

20 A commenter expressed concern that the consideration Fifth Third would 

provide to effect this proposal was excessive and suggested that this issue reflected 

negatively on its managerial resources. The Board notes that the consideration has 

been disclosed to shareholders and that Fifth Third would remain well capitalized 

on consummation. 
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The Board also has evaluated the managerial resources of the 

organizations involved, including the proposed combined organization. The Board 

has reviewed the examination records of Fifth Third, First National, and their 

subsidiary depository institutions, including assessments of their management, risk 

management systems, and operations. In addition, the Board has considered its 

supervisory experience and that of the other relevant banking supervisory agencies 

with the organizations and their records of compliance with applicable banking 

law.21 Fifth Third, First National, and their subsidiary depository institutions are 

considered well managed. The Board also has considered Fifth Third’s plans to 

integrate First National and its subsidiaries and the proposed management, including 

the risk management systems, of the resulting organization. 

Based on all the facts of record, the Board has concluded that the 

financial and managerial resources and future prospects of the organizations and the 

other supervisory factors involved are consistent with approval of the proposal. 

Convenience and Needs Considerations

 In acting on this proposal, the Board is required to consider the effects 

of the proposal on the convenience and needs of the communities to be served and 

to take into account the records of the relevant insured depository institution under 

the Community Reinvestment Act (“CRA”).22 The CRA requires the federal 

financial supervisory agencies to encourage financial institutions to help meet the 

credit needs of local communities in which they operate, consistent with their safe 

 

21 A commenter also expressed concern about Fifth Third’s managerial record in 

light of a recent enforcement action against the organization by the Federal Reserve 

Bank of Cleveland. The Written Agreement required Fifth Third to enhance its risk 

management systems, internal controls, and compliance procedures. After a careful 

review of the steps taken by Fifth Third to meet the requirements of the enforcement 

action, the Reserve Bank terminated the Written Agreement in April 2004. 

22 12 U.S.C. § 2901 et seq.
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and sound operation, and requires the appropriate federal financial supervisory 

agency to take into account an institution’s record of meeting the credit needs of its 

entire community, including low- and moderate-income (“LMI”) neighborhoods, in 

evaluating bank expansionary proposals. 

The Board has considered carefully the convenience and needs factor 

and the CRA performance records of the banks of Fifth Third and First National in 

light of all the facts of record, including public comment on the proposal.23 

Two commenters opposed the proposal and asserted, based in part on data reported 

under the Home Mortgage Disclosure Act (“HMDA”),24 that Fifth Third engaged in 

disparate treatment of African-American and Hispanic individuals in its home 

mortgage lending operations. In addition, one of these commenters expressed 

concern about potential branch closings. Approximately 25 commenters supported 

the proposal and commended Fifth Third for the technical and financial support 

provided to their community development organizations as well as the active 

involvement of the bank’s officers and staff. 

A. CRA Performance Evaluations

As provided in the CRA, the Board has evaluated the convenience and 

needs factor in light of the evaluations by the appropriate federal supervisors of the 

CRA performance records of the relevant insured depository institutions. An 

 

23 One commenter criticized Fifth Third’s relationships with unaffiliated payday 

lenders, car-title lending companies, and other nontraditional providers of financial 

services. As a general matter, these businesses are licensed by the states where they 

operate and are subject to applicable state law. Fifth Third also responded that it has 

entered into lending relationships with several check-cashing organizations, 

pawn shops, and rent-to-own companies, but that it plays no role in the lending 

practices, credit review, or other business practices of those borrowers. Fifth Third 

represented that in all such cases, it requires borrowers to represent and warrant to 

Fifth Third that they comply with applicable laws. 

24 12 U.S.C. § 2801 et seq.
- 9 -

institution’s most recent CRA performance evaluation is a particularly important 

consideration in the applications process because it represents a detailed, on-site 

evaluation of the institution’s overall record of performance under the CRA by its 

appropriate federal supervisor.25 

All the subsidiary insured depository institutions of Fifth Third 

received either “outstanding” or “satisfactory” ratings at the most recent 

examinations of their CRA performance. Fifth Third’s lead bank, Fifth Third Ohio, 

which currently accounts for approximately 60 percent of the total consolidated 

assets of Fifth Third, received a “satisfactory” rating at its most recent CRA 

performance evaluation by the Federal Reserve Bank of Cleveland. Fifth Third 

Bank also received a “satisfactory” rating at its most recent CRA performance 

evaluation by the Federal Reserve Bank of Chicago.26 First National Bank, First 

National’s only subsidiary bank, received a “satisfactory” rating at its most recent 

CRA performance evaluation by the OCC, as of August 5, 2002. 

 

25 See Interagency Questions and Answers Regarding Community Reinvestment, 

66 Federal Register 36,620 and 36,639 (2001). 

26 Both ratings are as of April 14, 2003. Fifth Third Bank, Florida, Naples, Florida 

(“Fifth Third Florida”); Fifth Third Bank, Indiana, Indianapolis, Indiana (“Fifth 

Third Indiana”); Fifth Third Bank, Kentucky, Inc., Louisville, Kentucky (Fifth 

Third Kentucky); and Fifth Third Bank, Northern Kentucky, Inc., Covington, 

Kentucky (“Fifth Third Northern Kentucky”) were merged into Fifth Third 

Bank on December 31, 2003. The most recent CRA performance evaluation 

ratings for these banks, also as of April 14, 2003, are as follows: Fifth Third 

Florida – “satisfactory” rating from the Federal Reserve Bank of Atlanta; Fifth 

Third Indiana – “satisfactory” rating from the Federal Reserve Bank of Chicago; 

Fifth Third Kentucky – “outstanding” rating from the Federal Reserve Bank of 

St. Louis; and Fifth Third Northern Kentucky – “satisfactory” rating from the 

Federal Reserve Bank of Cleveland. Fifth Third’s third subsidiary insured 

depository institution, Fifth Third, N.A., acquired Franklin National Bank, 

Franklin, Tennessee (“Franklin National”), on June 11, 2004. Franklin 

National received an “outstanding” rating from the Office of the Comptroller 

of the Currency (“OCC”), as of February 26, 2001. 
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Fifth Third has indicated that Fifth Third’s CRA program would 

continue to be implemented after First National Bank is merged into Fifth Third 

Bank, including Fifth Third’s CRA-related loan products, tax credit and equity 

investment programs, and grant and donation programs. Fifth Third has also 

represented that Fifth Third’s fair lending compliance program would continue to be 

implemented at the combined entity. 

B. CRA Performance of Fifth Third and First National

 Fifth Third Ohio. In the most recent CRA performance evaluation of 

Fifth Third Ohio, examiners commended the depository institution for its 

responsiveness to the credit needs of the communities it serves.27 Examiners also 

praised Fifth Third Ohio’s level of community development lending and noted 

favorably the use of diverse, flexible, innovative, and creative financing methods. 

Examiners stated that the bank’s level of qualified investments was excellent and 

reported that Fifth Third Ohio’s community development lending increased from 

$77 million during the previous examination period to $150.9 million during its 

most recent evaluation period. In addition, examiners praised Fifth Third Ohio’s 

community development services, including the bank’s partnerships with schools 

and various nonprofit organizations to provide educational and financial literacy 

programs to LMI individuals. 

Fifth Third Bank. At Fifth Third Bank’s most recent CRA performance 

evaluation, examiners commended the bank’s loan volume and general 

 

27 In evaluating the CRA performance records of Fifth Third Ohio, 

Fifth Third Bank, and Fifth Third Florida, examiners considered mortgage 

loans by certain affiliates in the banks’ assessment areas. The loans reviewed 

by examiners included loans reported by Fifth Third Mortgage Company, 

Dayton, Ohio (a subsidiary of Fifth Third Ohio), and Fifth Third Mortgage-MI, 

LLC, Grand Rapids, Michigan (a subsidiary of Fifth Third Bank). The evaluation 

period for the three performance evaluations was from January 1, 2001, to 

December 31, 2002. 
- 11 -

responsiveness to the credit needs of the communities it serves. Examiners noted 

that Fifth Third Bank originated or purchased higher percentages of 

HMDA-reportable loans to LMI borrowers in its assessment areas during the 

evaluation period than the percentages for the aggregate of lenders28

(“aggregate lenders”) in those areas. Examiners also noted that the bank had 

increased the number of home mortgage loans it made in LMI areas during the 

previous year. In addition, examiners praised the bank’s record of community 

development lending and its use of innovative and flexible loan products such as the 

Good Neighbor home mortgage loan program, which provides flexible underwriting 

standards for LMI borrowers. They also noted Fifth Third Bank’s excellent level of 

qualified investments and stated that its investments had helped stabilize and 

revitalize various neighborhoods and had benefited each of the bank’s assessment 

areas. According to examiners, Fifth Third Bank participated in almost $28 million 

in qualified investments during the evaluation period. In addition, examiners 

commended the bank’s community development services, which included free credit 

and money-management counseling services as well as counseling on first-time 

home buying. 

Fifth Third Florida. In the most recent CRA performance evaluation of 

Fifth Third Florida, examiners found that the depository institution’s lending levels 

were responsive to the credit needs of the communities it served and reflected 

adequate penetration among customers of different income levels, including 

LMI individuals. For instance, approximately 20 percent of the HMDA-reportable 

loans that Fifth Third Bank originated or purchased during the evaluation period 

were made to LMI borrowers. This compared adequately with the 21.6 percent of 

HMDA-reportable loans to LMI borrowers that the aggregate of lenders in the 

 

28 The lending data of the aggregate lenders represent the cumulative lending for all 

financial institutions that have reported HMDA data in a particular area. 
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bank’s assessment areas originated or purchased during the same period. In 

addition, examiners commended Fifth Third Florida’s level of community 

development investments and grants, particularly those not routinely provided by 

private investors. Examiners also noted the bank’s strong efforts to reach out to the 

growing Hispanic and Latino community. 

First National Bank. Examiners at First National Bank’s most recent 

CRA performance evaluation commended the bank’s home mortgage loan record 

among borrowers of different income levels, including LMI individuals. In 

particular, examiners noted that the bank originated a higher percentage of its home 

purchase loans in the Naples Metropolitan Statistical Area (“MSA”) to 

LMI borrowers than the percentage of LMI families residing in the MSA.29 

Examiners also noted the bank’s use of a flexible home mortgage loan product 

called “Own-A-Home,” which is designed to increase mortgage lending to 

LMI individuals. Features of the program include a loan-to-value ratio of up to 

97 percent and no requirement for private mortgage insurance. Examiners stated 

that First National Bank’s level of qualified investments was responsive to the credit 

and community development needs of the bank’s assessment areas. In addition, 

examiners commended the bank’s high level of community development services, 

noting that more than 90 percent of its qualified investments were mortgage-backed 

securities with underlying mortgages to LMI individuals. 

 C. HMDA and Fair Lending Record

The Board has carefully considered the lending record of Fifth Third in 

light of public comment on the HMDA data reported by its subsidiaries. Based on 

 

29 Examiners conducted a full-scope review of the Naples MSA, which represents 

the bank’s major market and accounts for 56 percent of all loan originations and for 

35 percent of First National Bank’s deposits. 
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2003 HMDA data, two commenters alleged that Fifth Third disproportionately 

excluded or denied applications by minorities for HMDA-reportable loans.30 

 The HMDA data for 2002 and 2003 indicate that Fifth Third’s denial 

disparity ratios31 for African-American and Hispanic applicants in 2002 and 2003 

were generally higher than or comparable with the ratios for the aggregate lenders in 

the markets reviewed.32 However, the bank’s denial disparity ratios for AfricanAmerican and Hispanic applicants decreased from 2002 to 2003 in most of the 

markets reviewed. The percentages of total HMDA-reportable loans originated by 

Fifth Third to African Americans and Hispanics generally was comparable with or 

lagged the performance of the aggregate lenders in the markets reviewed. The data 

also indicate that the percentages of Fifth Third’s total HMDA-reportable loans to 

African Americans and Hispanics increased from 2002 to 2003 in most of the 

markets reviewed.33 

 

30 A commenter also criticized generally First National Bank’s record of lending to 

minorities and its CRA performance. 

31 The denial disparity ratio equals the denial rate for a particular racial category 

(e.g., African-American) divided by the denial rate for whites. 

32 For purposes of this review, Fifth Third’s HMDA data include data reported by 

its mortgage subsidiaries operating in the relevant markets. The Board analyzed 

HMDA data for 2002 and 2003 reported by Fifth Third in the Naples, Florida, and 

Chicago, Illinois MSAs, and in certain MSAs on a statewide basis in Michigan and 

Ohio. The statewide data include the relevant data from the MSAs in Fifth Third 

Bank’s and Fifth Third Ohio’s assessment areas in Michigan and Ohio. Fifth 

Third’s percentages of HMDA-reportable loan originations to Hispanic applicants in 

2003 exceeded or were generally comparable with the performance of the aggregate 

lenders in Michigan and Ohio, but lagged the percentages for the aggregate lenders 

in the Naples and Chicago MSAs. 

33 One commenter criticized Fifth Third’s response to a fair lending complaint filed 

by the Department of Justice in May 2004 against Old Kent Financial Corporation 

and Old Kent Bank (collectively “Old Kent”). Fifth Third acquired Old Kent in 

2001. The Board notes that the alleged lending violations at Old Kent occurred 
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Although the HMDA data may reflect certain disparities in the rates of 

loan applications, originations, and denials among members of different racial 

groups in certain local areas, the HMDA data generally do not indicate that 

Fifth Third is excluding any racial group or geographic area on a prohibited basis. 

The Board nevertheless is concerned when HMDA data for an institution indicate 

disparities in lending and believes that all banks are obligated to ensure that their 

lending practices are based on criteria that ensure not only safe and sound lending, 

but also equal access to credit by creditworthy applicants regardless of their race. 

The Board recognizes, however, that HMDA data alone provide an incomplete 

measure of an institution’s lending in its community because these data cover only a 

few categories of housing-related lending. HMDA data, moreover, provide only 

limited information about the covered loans.34 HMDA data, therefore, have 

limitations that make them an inadequate basis, absent other information, for 

concluding that an institution has not assisted adequately in meeting its 

community’s credit needs or has engaged in illegal lending discrimination. 

 

between 1996 and 2000 and that Fifth Third was accused of no wrongdoing. The 

Board also notes that Fifth Third cooperated fully with the Department of Justice’s 

investigation into the earlier lending practices at Old Kent and in May 2004 agreed 

to settle the matter without contested litigation. 

 The commenter also expressed concern that Fifth Third Ohio’s home 

purchase loan data were reported in violation of HMDA. The Board reviewed the 

data reported by Fifth Third Ohio and has found that its home purchase loan data 

were reported in compliance with HMDA. 

34 The data, for example, do not account for the possibility that an institution’s 

outreach efforts may attract a larger proportion of marginally qualified applicants 

than other institutions attract and do not provide a basis for an independent 

assessment of whether an applicant who was denied credit was, in fact, 

creditworthy. Credit history problems and excessive debt levels relative to income 

(reasons most frequently cited for a credit denial) are not available from HMDA 

data. 
- 15 -

Because of the limitations of HMDA data, the Board has considered 

these data carefully in light of other information, including examination reports that 

provide an on-site evaluation of compliance by the subsidiary depository institutions 

of Fifth Third with fair lending laws. The record also indicates that Fifth Third has 

taken steps to ensure compliance with fair lending laws. The bank has implemented 

corporate-wide fair lending policies, procedures, and training programs, and it 

regularly conducts internal reviews for compliance with policies and procedures. In 

addition, Fifth Third has a compliance function with 17 full-time professionals 

devoted to consumer-law compliance issues. Fifth Third’s compliance programs 

include compliance training and testing and input from the heads of business units 

as well as from Fifth Third’s corporate Legal, Internal Audit, Consumer Credit, 

Commercial Credit, Compliance, and Community Development functions. 

 In addition, Fifth Third has taken various steps to increase its mortgage 

lending to minorities. For example, to market its home mortgage loan products 

more effectively to Hispanics, Fifth Third Bank implemented a Spanish Language 

Outreach Program (“Outreach Program”). Under the Outreach Program, the bank 

instituted new-account opening procedures and a Spanish-language advertising 

campaign, provided information about homeownership in Spanish, created loan 

documents in Spanish, and increased the availability of Spanish-speaking service 

representatives.35 

The Board also has considered the HMDA data in light of other 

information, including the programs described above and the overall performance 

records of Fifth Third’s subsidiary banks under the CRA. These established efforts 

demonstrate that the banks are active in helping to meet the credit needs of their 

entire communities. 

 

35 Fifth Third represented that the Outreach Program will be implemented at all 

Fifth Third subsidiary banks. 
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D. Branch Closures

One commenter expressed concern about possible branch closures and 

reductions in service after consummation of this proposal.36 Fifth Third has stated 

that it plans to close or consolidate five branches as a result of this proposal, but that 

these actions would not leave any markets without service. In addition, Fifth Third 

has represented that none of the branches it plans to close or consolidate as a result 

of this proposal is in an LMI census tract. 

The Board has reviewed Fifth Third’s branch closing policy. The 

policy requires Fifth Third to consider the impact on the community, the business 

viability and profitability of the branch, branch usage, demographic growth or 

decline in the community, the impact on credit access, and the necessity of ensuring 

that the branch closing has no discriminatory impact. The policy requires that, 

before a final decision is made to close a branch, management must conduct an 

impact study to assess the likely effects of any closure. The impact study of a 

branch in an LMI area includes consideration of concerns and ideas from the local 

community, an assessment of the closure’s potential impact on customers, and other 

possible ways the community’s credit needs will be met. In addition, examiners 

noted no instance in which Fifth Third’s subsidiary depository institutions’ records 

of opening and closing branches had adversely affected the level of services 

available in LMI areas during their most recent CRA performance evaluations. 

 

36 The commenter also expressed concern about possible job losses resulting from 

this proposal. The effect of a proposed acquisition on employment in a community 

is not among the limited factors the Board is authorized to consider under the 

BHC Act or the Bank Merger Act, and the convenience and needs factor has 

been interpreted consistently by the federal banking agencies, the courts, and 

the Congress to relate to the effect of a proposal on the availability and quality 

of banking services in the community. See, e.g., Wells Fargo & Company, 

82 Federal Reserve Bulletin 445, 457 (1996). 
- 17 -

The Board also has considered the fact that federal banking law 

provides a specific mechanism for addressing branch closings. Federal law requires 

an insured depository institution to provide notice to the public and to the 

appropriate federal supervisory agency before closing a branch.37 In addition, the 

Board notes that the Board and the OCC, as the appropriate federal supervisors of 

Fifth Third’s subsidiary banks, will continue to review the banks’ branch closing 

records in the course of conducting CRA performance evaluations. 

E. Conclusion on Convenience and Needs and CRA Performance

The Board has carefully considered all the facts of record,38 including 

reports of examination of the CRA performance records of the institutions involved, 

 

37 Section 42 of the Federal Deposit Insurance Act (12 U.S.C. § 1831r-1), as 

implemented by the Joint Policy Statement Regarding Branch Closings (64 Federal

Register 34,844 (1999)), requires that a bank provide the public with at least 

30 days’ notice and the appropriate federal supervisory agency and customers of the 

branch with at least 90 days’ notice before the date of the proposed branch closing. 

The bank also is required to provide reasons and other supporting data for the 

closure, consistent with the institution’s written policy for branch closings. 

38 One commenter requested that the Board condition its approval of the proposal 

on Fifth Third’s making certain community reinvestment and other commitments. 

As the Board previously has explained, an applicant must demonstrate a satisfactory 

record of performance under the CRA without reliance on plans or commitments for 

future actions. The Board has consistently stated that neither the CRA nor the 

federal banking agencies’ CRA regulations require depository institutions to make 

pledges or enter into commitments or agreements with any organization. 

See, e.g., Wachovia Corporation, 91 Federal Reserve Bulletin ___ (2005); 

J.P. Morgan Chase & Co., 90 Federal Reserve Bulletin 352 (2004). In this case, as 

in past cases, the Board instead has focused on the demonstrated CRA performance 

record of the applicant and the programs that the applicant has in place to serve the 

credit needs of its CRA assessment areas when the Board reviews the proposal 

under the convenience and needs factor. In reviewing future applications by Fifth 

Third under this factor, the Board similarly will review Fifth Third’s actual CRA 

performance record and the programs it has in place to meet the credit needs of its 

communities at the time of such review.
- 18 -

information provided by Fifth Third, public comments received on the proposal, 

confidential supervisory information, and Fifth Third’s plans to continue to 

implement its CRA-related policies and programs and its consumer compliance 

programs after First National Bank merges into Fifth Third Bank. The Board notes 

that the proposal would provide the combined entity’s customers with access to a 

broader array of products and services in an expanded service area, including access 

to an expanded branch and ATM network and increased capital resources. Based on 

a review of the entire record, and for the reasons discussed above, the Board 

concludes that considerations relating to the convenience and needs factor and the 

CRA performance records of the relevant depository institutions are consistent with 

approval. 

Conclusion

 Based on the foregoing and all facts of record, the Board has 

determined that the applications should be, and hereby are, approved. 39 In reaching 

 

39 A commenter requested that the Board deny the proposal, delay action on the 

proposal, or extend the comment period until Fifth Third provides information that 

the commenter has requested. The Board believes that the record in this case does 

not warrant postponement of its consideration of the proposal. During the 

application process, the Board has accumulated a significant record, including 

reports of examination, supervisory information, public reports and information, and 

considerable public comment. The Board believes this record is sufficient to allow 

it to assess the factors it is required to consider under the BHC Act, the Bank 

Merger Act, and the FRA. The BHC Act and the Board’s rules establish time 

periods for consideration and action on proposals such as the current proposal. For 

the reasons discussed above, the Board believes that the commenter has had ample 

opportunity to submit its views and, in fact, has provided substantial written 

submissions that the Board has considered carefully in acting on the proposal. 

Based on a review of all the facts of record, the Board concludes that delaying 

consideration of the proposal, granting an extension of the comment period, or 

denying the proposal on the grounds discussed above is not warranted. 
- 19 -

its conclusion, the Board has considered all the facts of record in light of the factors 

that it is required to consider under the BHC Act, the Bank Merger Act, and the 

FRA.40 The Board’s approval is specifically conditioned on compliance by 

Fifth Third and Fifth Third Bank with the condition imposed in this order and the 

commitments made to the Board in connection with the applications. For purposes 

of this transaction, the condition and these commitments are deemed to be 

conditions imposed in writing by the Board in connection with its findings and 

decision and, as such, may be enforced in proceedings under applicable law. 

 The proposed transactions may not be consummated before the 

fifteenth calendar day after the effective date of this order, or later than three months 

 

40 A commenter also requested that the Board hold a public hearing or meeting on 

the proposal. Section 3 of the BHC Act does not require the Board to hold a public 

hearing on an application unless the appropriate supervisory authority for the bank 

to be acquired makes a timely written recommendation of denial of the application. 

The Board has not received such a recommendation from the appropriate 

supervisory authority. The Bank Merger Act and the FRA do not require the 

Board to hold a public hearing or meeting. 

Under its rules, the Board may, in its discretion, hold a public meeting or 

hearing on an application to acquire a bank if a meeting or hearing is necessary or 

appropriate to clarify factual issues related to the application and to provide an 

opportunity for testimony. 12 C.F.R. 225.16(e). The Board has considered 

carefully the commenter’s request in light of all the facts of record. In the Board’s 

view, the commenter had ample opportunity to submit comments on the proposal, 

and, in fact, the commenter has submitted written comments that the Board has 

considered carefully in acting on the proposal. The commenter’s request fails to 

demonstrate why its written comments do not adequately present its evidence and 

fails to identify disputed issues of fact that are material to the Board’s decision that 

would be clarified by a public meeting or hearing. For these reasons, and based on 

all the facts of record, the Board has determined that a public meeting or hearing is 

not required or warranted in this case. Accordingly, the request for a public meeting 

or hearing on the proposal is denied. 
- 20 -

after the effective date of this order, unless such period is extended for good cause 

by the Board or the Federal Reserve Bank of Cleveland, acting pursuant to delegated 

authority. 

 By order of the Board of Governors,41 effective December 14, 2004. 

(signed) 

___________________________________ 

Robert deV. Frierson 

Deputy Secretary of the Board 

 

41 Voting for this action: Chairman Greenspan, Vice Chairman Ferguson, and 

Governors Gramlich, Bies, Olson, Bernanke, and Kohn.
- 21 -

APPENDIX A 

Addresses of Main Office and Branches to be Acquired by Fifth Third 

Altamonte Springs 

254 West State Road 436 

Apopka 

211 S. Edgewood Avenue 

Belleair Bluffs 

601 Indian Rocks Road North 

Boca Raton 

1850 North Federal Highway 

Bonita Springs 

9021 Bonita Beach Road 

8800 West Terry Street 

Bradenton 

5305 26th Street 

Cape Coral 

859 Cape Coral Parkway 

1600 East Cape Coral Parkway 

2724 Del Prado Boulevard 

1801 Pine Island Road 

1530 Santa Barbara Boulevard 

Clearwater 

11030 49th Street North 

1150 Cleveland Street 

100 Island Way 

Daytona Beach

519 North Oleander Avenue 

444 Seabreeze Boulevard, Suite 100 

1030 West International Speedway Boulevard 

Fort Lauderdale 

600 South Andrew Avenue, Suite 100 

Fort Myers 

7130 College Parkway 

2915 Colonial Boulevard 

15221 Tamiami Trail South 

Indian Shores 

18395 Gulf Boulevard 

Lake Mary 

175 Timucuan Boulevard 

Largo 

705 8th Avenue SW 

12360 Indian Rocks Road 

Longwood 

2491 West State Road 434 

Maitland 

100 South Orlando Avenue 

Marco Island 

650 East Elkcam Circle 
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Naples 

7925 Airport Road 

5475 Airport Pulling Road North 

4794 Golden Gate Parkway 

900 Goodlette Road 

2150 Goodlette Road North42

2470 Immokalee Road 

4025 Radio Road 

8771 Tamiami Trail North 

5101 Tamiami Trail East 

2911 Tamiami Trail North 

North Dunedin 

1255 Belcher Road 

North Port 

12767 Tamiami Trail South 

North Ruskin 

1020 US Highway 41 

Orlando 

1401 Lee Road 

250 North Orange Avenue 

2324 Sand Lake Road 

5292 South Orange Blossom Trail 

Ormond Beach 

4 North Beach Street 

Oviedo 

1753 East Broadway 

Palm Beach Gardens 

319 Peruvian South 

4400 PGA Boulevard, Suite 100 

 

42 Main Office of First National Bank. 

Palm Harbor 

1100 East Lake Road 

1027 Nebraska Avenue 

Port Orange 

5100 Clyde Morris Boulevard 

Saint Petersburg 

4105 Gulf Boulevard 

Sarasota 

2035 Cattleman Road 

3700 Tamiami Trail South 

Seffner 

11710 Martin Luther King Jr. Boulevard East 

Seminole 

9111 Oakhurst Road 

10899 Park Boulevard 

11201 Park Boulevard #71 

Tampa 

2028 East 7th Avenue 

2001 Adamo Drive 

3117 West Columbus Drive 

1921 South Dale Mabry Highway 

719 Harbour Post Drive 

8603 West Hillsborough Avenue 

4401 West Kennedy Boulevard 

4427 West Kennedy Boulevard 

1901 West Swann Avenue 

8809 West Waters Avenue 

Treasure Island 

180 Treasure Island Causeway 
-24-

Valrico 

3402 Lithia Pinecrest Road 

Venice 

1340 East Venice Avenue 

1641 Jacaranda Boulevard 

273 Tamiami Trail South 

West Palm Beach 

606 North Olive Avenue

Winter Park 

1500 Lee Road 
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APPENDIX B 

Florida Banking Market Definitions 

Naples 

Collier County, excluding the town of Immokalee. 

Fort Myers 

Lee County, excluding Gasparilla Island, and the town of Immokalee in Collier 

County. 

Sarasota 

Manatee and Sarasota Counties, excluding the towns of Northport and Port 

Charlotte; the towns of Englewood, Englewood Beach, New Point Comfort, Grove 

City, Cape Haze, Rotonda, Rotonda West, and Placido in Charlotte County; and 

Gasparilla Island in Lee County. 
-26-

APPENDIX C 

Banking Market Data 

Naples, Florida 

Fifth Third operates the sixth largest depository institution in the Naples banking 

market, controlling $511.4 million in deposits, which represents 6.5 percent of 

market deposits. First National operates the second largest depository institution in 

the market, controlling $1.2 billion in deposits, which represents 15.3 percent of 

market deposits. On consummation of the proposal, Fifth Third would be the 

largest depository organization in the market, controlling deposits of 

approximately $1.7 billion, which represent approximately 21.8 percent of market 

deposits. The HHI would increase 198 points to 1,261. Thirty-one other bank and 

thrift competitors would remain in the market. 

Fort Myers, Florida 

Fifth Third operates the seventh largest depository institution in the Fort Myers 

banking market, controlling $288.6 million in deposits, which represents 

3.4 percent of market deposits. First National operates the fourth largest 

depository institution in the market, controlling $636.8 million in deposits, which 

represents 7.6 percent of market deposits. On consummation of the proposal, Fifth 

Third would be the fourth largest depository organization in the market, controlling 

deposits of approximately $925.5 million, which represent approximately 

11 percent of market deposits. The HHI would increase 52 points to 1,212. 

Twenty-five other bank and thrift competitors would remain in the market. 

Sarasota, Florida 

Fifth Third operates the 38th largest depository institution in the Sarasota banking 

market, controlling $20.1 million in deposits, which represents less than 1 percent 

of market deposits. First National operates the eighth largest depository institution 

in the market, controlling $308.6 million in deposits, which represents 2.2 percent 

of market deposits. On consummation of the proposal, Fifth Third would be the 

eighth largest depository organization in the market, controlling deposits of 

approximately $328.7 million, which represent approximately 2.4 percent of 

market deposits. The HHI would increase one point to 1,258. Thirty-nine other 

bank and thrift competitors would remain in the market.