Good afternoon, 

My name is Rafael Sanchez and I am on the Board of Directors of the 

USHCC and a small business owner. 

The United States Hispanic Chamber of Commerce (USHCC) is the leading 

Hispanic business association in the U.S., advocating the interest of over one 

million Hispanic owned businesses and over 250 Hispanic chambers of 

commerce. 

We’have very serious concerns with the proposed Bank of America/Nations 

Bank merger and the impact it may have with our respective businesses and 

communities. Its is our belief that access to capital is the life-blood of 

businesses and that any changes to its availability must be closely 

scrutinized. 

Past experience has demonstrated that mergers between large financial 

institutions have resulted in the following: 

l Fewer loans to minorities. 

l The elimination of employment positions 

l Vendor contract bundling. 

. A decline in customer service 

l A reduction in financial support to community based organizations, 

including local Hispanic chambers of commerce. 

It is distressing to learn from the Greenlining Institute, the following 

statistics in regards to BofA/Nations (it is estimated that in 1997): 
l 1% of all contracts were awarded to African Americans, Latinos, or 

Asians Americans. 

l 1% or less, of total dollar volume of all business loans were made to 

African American, Latinos, or Asian Americans. 

l Less than + of 1% of pre-tax earnings were contributed to African 

Americans, Latino, or Asian American non profits. 

l Less than 3% of the total dollar volume of conventional home loans were 

. 

made to African Americans. 

l Less than 2% of the top 100 management (by salary) are African 

American, Latino, or Asian American. 

While Nations Bank has announced a $350 billion community reinvestment 

pledge, they have refused (according to the Greenlining Institute) to 

establish specific goals making the pledge unmeasurable and unenforceable. 

This is cause for grave concern given their mediocre record, (IS evidenced by 

the above mentioned statistics. 

We would urge careful deliberation given the extraordinary size of the 

merged banks which would now operate in 22 states, provide banking 

services to 29 million households, and would control 8% of all deposits in the 

nation. We are concerned that this merger may be allowed to proceed while 

largely ignoring the rapidly growing number of minority and women owned 

businesses. 

Thank you 
NATIONAL ASSOCIATION FOR THE ADVANCEMENT OF COLORED PEOPLE 

4805 MT. HOPE DRIVE l BALTIMORE, MD 21215-3297 l (410) 358-8900 

WEISI MFUME JULIAN BOND 

President 8 Chief ExecufrVe Officer Chair Board ol Direcrors 

TESTIMONY BY 

TAMMY D. HAWLEY 

. NAACP REPRESENTATIVE 

BEFORE THE 

FEDERAL RESERVE BOARD 

NATIONS/BANKAMERICA PUBLIC MEETING 

SAN FRANCISCO, CALIFORNIA 

JULY 9, 1998 
Presiding officer, members of the panel, my name is Tammy Hawley, and I am 

presenting on behalf of the National Association for the Advancement of Colored People 

(NAACP) and our national president and chief executive officer, the honorable Kweisi 

Mfume. The NAACP appreciates the opportunity to present here today for the public 

record regarding the proposed acquisition of BankAmerica Corporation by NationsBank 

Corporation. Our testimony is primarily as it relates to our existing relationship with 

NationsBank. 

. 

The NAACP, an organization which was founded in 1909, has a long-standing 

history of focusing on civil rights, economic and community development, and selfsufficiency for African Americans and other minority groups. With over 1700 units 

serving communities across this country and abroad, the present mission of the NAACP 

remains congruent with its founding principles; however the organization has in recent 

years assumed a more proactive, aggressive approach to achieving individual and 

community empowerment. 

Many of the communities the NAACP serves face critical social and economic 

problems arising in part from the lack of economic growth, and lack of employment and 

other opportunities. The evidence has been clear for years that credit is just not available 

on an equal basis to all people in all communities in America. That means that the ability 
to take part in the American dream, to participate in the economic mainstream, is not 

open to all Americans. 

The NAACP has worked to level the economic playing field and to bring about 

economic parity for minority group citizens. It has launched efforts like the Fair Share 

Program, which reviews corporate opportunity and investment activity, and the Economic 

Reciprocity Initiative, which leverages collective economic clout. The NAACP has also 

established Community Development Resource Centers (CDRC), which target specific 

focal areas and concerns in local communities. The Community Development Resource 

Center operation seeks to expand on building economic capacity, leveraging resources, 

and pooling capital for affordable housing, consumer lending, economic development, 

public and private partnerships and business development outreach. 

The NAACP Community Development Resource Centers were established in 

1994, as a pilot project, through a par-tnership with NationsBank. The purpose of these 

centers is to help promote an effective delivery system of credit programs and services by 

increasing community awareness of available products and services and undertaking 

“grass roots” community needs assessment. Before entering into such a partnership with 

NationsBank, the NAACP considered factors including Community Reinvestment Act 

performance, corporate programs and policies. as well as lending and outreach efforts. 

Since 1994, NationsBank has made a tremendous commitment and advanced in 

promoting economic revitalization and community development through investment in 

3 
the CDRC operation and its efforts. Through the NAACP partnership with NationsBank, 

more than $90 million in loans have been closed in communities traditionally 

underserved by financial institutions. Services now being provided through the existing 

six operating centers primarily focus on consumer and business education and 

counseling, economic development advocacy and technical assistance in the areas of 

needs assessment, product development, marketing, lending practices, strategic planning 

and product and service delivery. 

Regarding,the proposed acquisition of Bat&America Corporation by NationsBank 

. 

Corporation, the NAACP is positioning itself as a resource to ensure that certain goals are 

met and matters not overlooked, if a merger of the two institutions goes forward. We are 

very concerned about consumer protection, competition and economic expansion. 

Successful and effective mergers are to lower costs, improve product quality or 

otherwise achieve efficiencies. The proposed new bank’s commitment to $350 billion in 

community development lending and investment over the next ten years is indication of 

an expected enhanced delivery of services resulting from the merger. $350 billion 

represents the largest community development commitment ever announced by a 

financial institution. fhis is an opportunity for organizations like the NAACP to 

challenge this bank to bank and an opportunity for the new bank to live up to a bank’s 

chartered role as an economic leader in communities. 

4 
The restoration and maintenance of the economies of underserved communities 

will require coordinated development strategies, intensive supportive services, and 

increased access to equity investments and loans for development activities. The $350 

billion commitment, with appropriate follow-through, promises to address these matters. 

It is our understanding that the NAACP will continue to be a viable partner in the efforts 

to be undertaken by the new bank. This will help to assure representative benefit to the 

communities the NAACP serves. If a merger is successful, the NAACP will realize an 

opportunity for the CDRC operation to grow and expand into other markets as well. The 

expansion of the .CDRC operation will allow for our one-stop approach to technical 

. 

assistance, real estate and business development services and consumer counseling to 

reach additional communities across the country. Furthermore, the already e.<isting 

delivery system of NAACP units throughout the country provide a ready-made 

infrastructure to ensure an ability for immediate reach into communities for the new bank 

to begin to perform on the community development lending and investment commitment 

it has made. 

The community development commitment also designates $180 billion of the 

$350 billion for the purpose of small business lending. The NAACP support the notion 

that small business development is crucial to the success of state or local economic 

development programs. We are also looking for assurances that benefit will accrue tc’ the 

minority business community. One concept the NAACP is promoting is the expansion of 

small business incubator concepts, which \\-e have launched successfully in sm:!ller 

markets. A small business incubator is a facility that offers small business tenants 

5 
affordable rent, shared office services, and access to responsive management consulting 

services. Incubators are based on a concept of economic development, which targets 

small business development as the primary method of creating new jobs and diversifying 

a community’s employment base. The incubator approach helps to avoid the common 

pitfalls faced by emerging small businesses-namely poor marketing, poor management 

and lack of capital. The NAACP incubator projects will provide a more positive local 

entrepreneurial climate, neighborhood revitalization, technological innovation, and 

commercialization of new projects and would help the new bank meet its small business 

lending goals. 

. 

Also, the NAACP itself has been pursuing Community Development Financial 

Institution (CDFI) status for its CDRC operation. NationsBank has supported the 

NAACP in this pursuit. Once CDFI status is approved by the Department of Treasury, 

the NAACP will become a more direct resource in helping the new bank and other 

financial institutions reach economic development goals through the use of financial 

intermediaries. 

Finally regarding the new bank’s internal structure, the NAACP is keenly 

interested in diversity goals regarding senior management and the governing board of 

directors. If the mergers is approved and as the proposed new bank solidifies its diversity 

goals, objectives and policies. the NAACP will continue to be a resource and to monitor 

the financial institution’s inter-nal structure evolvement. 

6 
The NAACP believes that the proposed acquisition and merging of resources can 

benefit access to credit and capital. Enhanced partnerships with organizations like the 

NAACP, ACORN Housing Corporation, the Enterprise Foundation, the National Urban 

League and the National Council of La Raza, more readily assure success where 

communities are concerned. If this merger does go forward, the NAACP will do its part 

to ensure that resources are channeled appropriately and to expand on our existing 

partnership to the benefit of communities nationwide. 

Again, thank you for the opportunity to appear before you today. 

. 
July 9, 1998 

Testimony of Johnny J. Mack, President and Chief Executive Officer of the 

National Institute for Community Empower& Inc. 

to the Federal Reserve Bank of San Francisco 

in favor of the proposed merger of 

NationsBank Corporation, Charlotte, North Carolina and 

BankAmerica Corporation, San Francisco, California 

As president of the National Institute for Community Empowerment, Inc., I am 

pleased to testify today in favor of the proposal by NationsBank Corporation, 

Charlotte, North Carolina, to merge with Bar&America Corporation, San 

Francisco. California. 

For over seven years, I have had the pleasure to work with NationsBank officials 

in connection with community development activities. My first occasion was as a 

senior official of the Martin Luther King, Jr. Center for Nonviolent Social Change, 

Inc. In 1990, The King Center established the Community Empowerment 

Initiative, a program to assist low wealth communities in building social capital, 

assets, jobs and overall community wealth. Over a six-year period this program 

assisted communities across the country using the philosophy and principles of 

nonviolent social change as espoused by Dr. Martin Luther King, Jr. 

Funding for the program was provided in large measure from Federal special 

purpose grants and contracts administered by the U.S. Department of Housing 

and Urban Development. In addition, several corporations provided funding in 
support of its programs; most significant among them is NationsBank. Along with 

its financial support, NationsBank was represented on a national advisory 

committee composed of leaders from the community, public and private sectors. 

Further demonstrating their commitment, the NationsBank representative was a 

senior level official in the person of Ms. Cathy Bessant, President of NationsBank 

Community Investment unit. Working with other national leaders, Ms. Bessant 

gave valuable counsel and direction to the program. From its very beginning, 

through the end of the program, NationsBank consistently provided these 

resources; particularly during times when the need was most critical. 

My second occasion to work with NationsBank immediately followed the first. In 

July 1997, The King Center launched the Community Empowerment Initiative 

program as a separate independent nonprofit organization, the National Institute 

for Community Empowerment, Inc. (N.I.C.E.). During this time, I served as the 

Chief Administrative Officer of The King Center and had the pleasure of working 

with Ms. Vickie Tassan, a NationsBank senior vice president. Ms. Tassan gave 

considerable attention as an advisory committee member, and through financial 

support provided by NationsBank, in creating the new organization. Consistent 

with the standard set by Ms. Bessant, under the Community Empowerment 

Initiative program, NationsBank is giving senior level participation on the N.I.C.E. 

board of trustees as well as funding critical to its operations. And, once again, 

NationsBank is taking the lead among corporate sponsors. Ms. Tassan now 

2 
serves on the N.I.C.E. board of trustees She not only gives valuable counsel, 

she has recruited other national leaders to serve as well. 

The importance of the relationship N.I.C.E. and NationsBank have established is 

articulated in the following quote of Dr. Martin Luther King, Jr.: “It evokes happy 

memories to recall that our victories in the past decades were won with a broad 

coalition of organizations representing a wide variety of interests. But we 

deceive ourselves if we envision the same combination attacking structural 

changes in this society. It did not come together for such a program and will not 

reassemble for it.” 

This quote is taken from Dr. King’s 1967 book, Where do we go from here: 

Chaos or Community? In contemplating a general plan for the future, Dr. King 

realized that a different coalition of organizations and new strategies to overcome 

the seemingly intractable barriers of urban centers would be necessary. He saw 

that new coalitions and strategies must augment the alliances of the civil rights 

movement. 

Since his assassination, new forms of community-based and community-serving 

organizations have emerged. Until recently, however, these organizations have 

either dabbled at the fringes or are completely unaware of the power that the 

philosophy and principles of nonviolent social change bring to the field of 

3 
. 

community empowerment. Yet, the gravity of its importance has not escaped the 

careful attention of NationsBank. 

As the organization established by Mrs. Coretta Scott King, and launched by the 

Martin Luther King Center for Nonviolent Social Change, Inc., to carry on the 

work of community empowerment, the National Institute for Community 

Empowerment, Inc. is pleased to share in an alliance with NationsBank that 

uniquely positions us to represent the coalition presaged in Dr. King’s quote. 

Commenting on the launch of N.I.C.E., Dexter Scott King, Chairman and CEO of 

The King Center said, “Establishing N.I.C.E. is the natural progression for a 

program started more than six years ago under the leadership of my mother. 

The spirit of its mission is kindred with our struggle for decades to bring about 

nonviolent social change. I am confident that as a separate and independent 

nonprofit organization, N.I.C.E. will continue the good and important work begun 

by The King Center to help create self-empowerment and restore community 

across the country.” 

NationsBank has demonstrated, by example, their commitment to the work of 

community empowerment, through public/private partnerships, that Dr. King, Mrs. 

King, and, now, their son Dexter, have dedicated their lives to. 
I believe this proposed merger could only strengthen continuing the work of 

community empowerment. NationsBank Corporation and Bar&America 

Corporation have consistently demonstrated their commitment to community 

development by their community reinvestment activities. This is demonstrated by 

the recent announcement of their $350 billion community investment 

commitment. While I have not, yet, worked closely with community development 

officials of the Bar&America Corporation, I have followed closely their 

community investment activities, and have been impressed by their efforts to 

meet the needsof under-served markets. 

I believe NationsBank Corporation and Bank/America Corporation are the 

industry leaders in this field. Their complimentary geographic service areas 

provide a national scope and services in a manner that as a whole is greater than 

the sum of its parts. I conclude, therefore, that the two banks combined would 

bring an exceptional commitment to lending, investment and service and I urge 

you to support the proposal. 

Thank you. 

Johnny J. Mack