C H A P A 

Citizens’ Housing and 

Planning Association, Inc 

President 

N/en Feingold 

Vice Presidents 

Jack Cooper 

Peter Gagliardi 

Ann Houston 

Robert Kuehn. Jr. 

Treasurer 

Matthew Hobbs 

Clerk 

Neanor White 

Executive Director 

Aaron Gomstein 

Testimony of Ellen Feingold to the Federal Reserve Bank 

Regarding the Proposed Merger of Fleet and BankBoston 

July 7, 1999 

My name is Ellen Feingold and I am the president of Citizens’ Housing and Planning 

Association. Thank you for providing me with the opportunity to testifl this morning. 

About CHAPA 

Established in 1967, CHAPA is a non-profit organization that advocates for the production 

and preservation of affordable housing for low income people. 

Our membership of 1,500 people is made up of a broad range of interests, including 

housing providers and developers, tenants, advocacy organizations, government officials, 

local planners, lenders, and many others. We are one of the largest and most diverse 

housing coalitions in the region. 

Why the Merger is Important 

The proposed merger between Fleet and BankBoston is especially important to the 

affordable housing community for three reasons: 

(1) Today, we face a housing crisis of enormous and growing proportions. Low and 

middle income residents in New England are being priced out of the homeownership and 

rental markets in record numbers. 

(2) Government cutbacks at the state and federal levels have meant that affordable housing 

developers must rely on private financial institutions to a much greater extent than ever 

before. 

(3) In recent years, the housing community has worked closely with both Fleet and 

BankBoston to craft solutions to the housing affordability problem. This merger provides 

an important opportunity to build and expand on this recent progress. On the other hand, 

without certain specific lending commitments that will directly benefit low and moderate 

income people, this merger poses a real danger because community investment could fall 

dramatically in the areas that need it the most. 

THIS AGENCY IS 

SUPPORTEDBY 

18 Tremont Street 0 Suite 401 * Boston, MA 02108 4 Telephone (617) 742-0820 a Fax (617) 742-3953 

Website: www.chapa.org 
Federal Reserve Stipulations on Merger 

Since the proposed merger was announced, Fleet and BankBoston have submitted a general 

proposal to commit $4 billion in affordable housing mortgages and $2 billion in community 

development lending over five years. This was part of an overall $14.6 billion proposal. 

As part of your consideration of this merger, the Federal Reserve should require Fleet and 

BankBoston to do the following: 

1. Provide details on how this overall commitment compares with the combined lending of the 

two banks over the past three years, with a breakdown for each New England state. Their 

proposed level of commitment cannot be evaluated without this critical information. 

2. Provide specific programmatic details for each lending area. For example, it is not enough to 

say that a certain amount of fimds will go toward rental housing development. The proposal must 

specify what will be the terms of this lending, how it will be achieved, what delivery systems will 

be used, and what income groups will be served. 

3. Finally, Fleet and Bar&Boston should enter into a written agreement with the appropriate 

housing and community development organizations--similar to previous CRA agreements that 

both banks have entered into. It is absolutely essential that a sound mechanism is developed to 

ensure that these commitments will be upheld and monitored. 

In order for the banks to f&hill these requirements, we ask that the Federal Reserve extend its 

public comment period for an additional two weeks after the banks submit a revised community 

investment proposal. 

CHAPA’s Priorities for Community Investments 

CHAPA’s particular focus is on affordable housing, and we therefore, would like to see the 

following five priorities addressed as a condition of the merger: 

(1) Fleet/BankBoston should expand their commitment to the Soft Second Mortgage Program 

statewide. The Soft Second Program has been one of the most effective programs for helping low 

income families become homeowners. 

(2) The banks should convert their required MHP Fund commitment to equity, similar to what 

BankBoston did during the merger between the Bank of Boston and BayBanks. While there are 

many sources of permanent financing to build rental housing, it is extremely difficult to obtain 

equity so that developers can provide more affordable apartments. 

(3) The merged bank should expand its commitment to funding and sustaining homebuyer 

education and counseling throughout the region. As banks move towards more flexible 

underwriting, it is critical to support the network of homebuyer counseling agencies--for both prepurchase, post-purchase, and foreclosure prevention counseling. 
(4) The merged bank should continue its membership in the Federal Home Loan Bank of Boston 

over the long-term to ensure access to its affordable housing and community investment 

programs. 

(5) The combined bank should expand its commitment to foundation giving. Many groups which 

receive Cmds from both banks believe they will see reduced foundation funding as a result of this 

merger. The Federal Reserve should ensure that this does not happen. 

We look forward to receiving more details on the ways in which the merged bank will maintain 

and expand its commitment to investing in low and moderate income neighborhoods. Thank you 

very much for giving me this opportunity to testify. 
Minority Developers Association 

351 Massachusetts Avenue 

Boston, Massachusetts 02115 

Tel: (617) 266.8604 Fax: (617) 266.0185 

July 7, 1999 

Fleet Financial Group, Inc. 

BankBoston Corporation 

Public Meeting Information 

We thank you for this public opportunity to express our views on the impact of the 

proposed merger of Bar&Boston and Fleet Bank upon our community’s minority and 

women-owned businesses. 

As you know, small businesses employ over 53% of this nation’s workforce and they 

produce over half of the nation’s gross domestic product, and they provide virtually all of 

the new net jobs added to the economy. [Source: Elaine F. Guiney, Mass. Director of 

U.S. Small Business Administration] 

Financial institutions have an obligation to provide vital financial services to the 

communities in which they are located. In today’s growing economy we have an 

opportunity to grow productive, stable businesses, particularly within the rninorityowned business sector, that will continue to provide job opportunities for community 

residents. 

Consolidation with in the banking and real estate industries makes access to capital for 

small and mid-sized real estate companies difftcult. Smaller sized and mixed-use projects 

cannot be financed through the public capital markets, and often rely on Federal, State 

, and local programs combined with creative, flexible and innovative Bank financing in 

. order to be successfully completed. 

Companies and customer located in inner-city neighborhoods know that the untapped 

market potential in their neighborhoods is enormous. The challenges for these businesses 

are also great. Having a relationship with a Bank which knows the market and is 

experienced with the technical aspects of public/private partnership financing enables 

companies to spend less time trying to find capital, an more time growing their 

businesses. 

Bank Boston Development Company LLC, a part of the Bar&Boston Community 

banking group, has pioneered in meeting the financial needs of the minority and womenowned business enterprises by providing just such vital financial service: equity 

investments that grow minority businesses. 
As part of the regulatory and community review and approval of the proposed merger of 

BankBoston and Fleet Bank, it is vital that an equity investment fund, consisting; initiallv 

of Five Hundred Million Dollars, be dedicated to continue providing substantial equity 

investments in viable minority and women-owned businesses. 

This emerging market, minority and women-owned businesses, is the fastest growing 

segment of the business community. These businesses are also a tremendous growing 

business opportunity for the new bank. By building upon the successful track record of 

BankBoston Development Company and by expanding its capacity for direct equity 

investment in minority and women-owned businesses, this new financial institution will 

make a great and lasting contribution to our community. 

With substantial financial equity investment focused on our community’s MBE/WBE 

businesses, the new bank will empower the productive, economic capacity of our 

community’s businesses. The hard work, long hours and personal sacrifices of the owners 

of these MBENBE businesses, properly capitalized, will then generate new jobs, 

security for the working families in our community and successful role models for our 

children. 

President 

Minority Developers Association 
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1 

1997 LENDING ANALYSIS 

“. ROCHESTER, NEYY YORK 

Issued by: 

Greater Rochester Community Reinvestment Coalition 

(GRCRC) 

P.O. Box 39541 

Rochester, NY 14604 
TABLE OF CONTENTS 

Executive Summary 1 

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Part I. Analysis of Home Mortgage Disclosure Act (HMDA) data 

A. HMDA data for all lenders in the Rochester Metropolitan Statistical Area @ISA) 

1. Changes in the lending role of the eight largest depository banks since 1992 

2. Sub-prime lending 

3. Mortgage banks 

HMDA Loans 19951997 

1. Loans to Black and Hispanic households 

2. Changes in lending in the City of Rochester 

3. Home improvement lending 

4. Loandenials 

5. Lending progress since 1992 

6. Rochester/Buffalo lending comparison 

7. Recommendations 

B. Comparison of HMDA lending of eight major banks 22 

1. Chase, Citibank 26 

2. Charter One, First National 29 

3. Fleet, Key 31 

4. M&T, Marine MidIandHSBC 35 

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Part II. Small Business Loans 

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A. Aggregate small business lending data 38 

1. Total number of small business loans Monroe County 39 

2. Loans in low-moderate income census tracts 39 

3. Loans to businesses with Gross Annual Revenues < $1 million 40 

4. Small business loans < $100,000 44 

5. Small business loans in the City 45 

B. Comparison of small business lending of seven major banks 

1. Chase, Citibank 

2. First National, Fleet 

3. Key, M&T, Marine Midland/HSBC 

Glossary 56 

TABLES 

Table 1. Characteristics of Sub-prime borrowers in Rochester 

Table 2. Top 8 Bank HMDA lenders 1997, Rochester MSA 

Table 3. Bank denial rates 1997 

Table 4. Regional comparison of lending to businesses with GAR C $1 M in mid-size cities 

Table 5. Top 7 bank small business lenders 1997, Monroe County 

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EXECUTIVESUMMARY 

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This report, issued by the Greater Rochester Community Reinvestment Coalition 

(GRCRC) contains an analysis of Home Mortgage and Small Business lending patterns. 

The analysis looks at aggregate lending, as well as lending by the eight largest banks, by 

amount of local deposits and branches located in the Rochester Metropolitan Statistical 

Area (MSA). These banks are Chase Manhattan, Citibank, Charter One (RCSB), First 

National Bank, Fleet, Key Bank, M & T and Marine Midland Bank (HSBC).’ 

GRCRC was convened in 1993 to generate discussion about the lending patterns in 

Rochester, Since then, the Coalition has released four analyses of home mortgage and 

small business lending data.2 We have used the analyses to identify strengths and 

weaknesses in lending patterns and to generate ongoing discussion with the banks in 

question. The Coalition also submits comments, based on the data, to the appropriate 

Federal regulators who have oversight of the banks. This analysis continues the dialogue. 

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The report is divided into four parts, the first two focus on Home Mortgage Disclosure 

Act (I-&IDA) data, while the third and fourth focus on small business lending data. 

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The HMDA portion of the analysis is further divided into two parts. The first analyzes the 

aggregate HMDA data in the Rochester MSA by all financial institutions, It discusses the 

changes in the market over the last five years; examines lending in the City of Rochester; 

looks at lending to traditionally under-served populations and neighborhoods; and 

compares denial rates across racial categories. There is also a section comparing the 

HMJIA lending in Rochester to lending in Buffalo, as well as the changes in those 

markets. 

The second part looks at the individual HMDA lending patterns of the eight largest banks 

serving the Rochester MSA and focuses primarily on 1996 and 1997 data. 

The small business lending portion of the report is also divided into two parts and 

compares changes in lending between 1996 and 1997, in Monroe County.3 The part on 

aggregate lending looks at: lending in low-moderate income census tracts; loans to 

businesses with Gross Annual Revenues (GAR) <$l million; and loans in the City of 

Rochester. The section on the individual banks looks at the individual lending patterns of 

the seven largest banks serving Monroe County. 

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The report examines some of the changes in mortgage lending that have occurred since 

1992. The eight largest depository institutions no longer originate most of the HMDA 

loans in the MSA. Sub-prime lenders, credit unions and mortgage banks now account for 

’ 1996 Data for First Federal Savings and Loans of Rochester (acquired by Marine Midland) and OnBank 

(acquired by M & T ) is also included. 

’ Analysis of home mortgage loans (1994 and 1996), analysis of home mortgage denials (1995), Small 

Business loans (1997). 

3 Small business loan data is only available for these two years. 
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more than half the HMDA loans in the MSA. The report also focuses on the low 

percentage of the dollar volume of loans to business with GAR C $ 1 million in the 

Rochester MSA. 

Some of the most significant findings of the report are as follows: 

l The eight largest banks decreased their HMDA lending by 60% between 1993 and 

1997. 

l The ten largest sub-prime lenders increased their HMDA lending by 608% between 

1993 and 1997. 

l Rochester has made more significant gains than Buffalo in improving HMDA lending 

to traditionally under-served populations in the last five years. 

l Since 1992, home mortgage lending to city residents, Black and Hispanic households 

and low-moderate income people has improved. 

l In 1997, 30% of all I-IMDA loans in the MSA were originated to low-moderate 

households, down from 32% in 1995, but up from 27% in 1996. 

l In 1996, HMDA lending to Black/Hispanic households increased by 12% over 1995 

and then stayed the same in 1997. 

l The Black to White denial ratio was actually higher for upper income Black 

applicants (2.6: 1) than lower income Black applicants (1.5: 1) for I-IMDA loans in 

1997. 

l In 1997, only 25% of the dollar volume of small business loans were originated to 

businesses with GAR < $ 1 million in the Rochester MSA. Nationally, 40% of the 

dollar volume of small business loans were originated to businesses with GAR < S 1 

million. 

l In 1997 the number of small business loans increased by 9%. 

The Coalition is proud of the gains achieved over the last five years and is determined to 

carry its work with lenders in the same spirit of mutual cooperation that has served us so 

well these last five years. 

For more information about the Coalition or the report call Ruhi Maker Esq. at 716-454- 

4060 or e-mail at rmaker@wnvlc.com. 

To purchase a copy of the report please send $12 (check or money order) to the Public 

Interest Law Office of Rochester, 80 St. Paul St. Rochester, NY 14604. 

Funding to support the production of this report was partially provided by the Department 

of Community Development, City of Rochester, New York through a grant to the Public 

Interest Law Office of Rochester. Thanks are extended to Commissioner Tom Argust and 

Assistant Director for Housing Bob Barrows for their invaluable assistance. Gladys 

Gonzales Castro of PILOR spent innumerable hours on charts, tables, and graphs. Thank 

you Gladys. 

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Part 1 

A. LOANS BY ALL HMDA LENDERS IN THE MSA. 

Within this decade, there has been a significant shift in home mortgage lending in 

Rochester. The market share of the largest local banks has declined and new types of 

lenders have entered the market. This report covers HMDA loans originated by all 

financial institutions in the Rochester MSA. 4 HMDA loans include loans for home 

purchase, refinancing and home improvement. Non-occupant and multi-family loans are 

also reported in the HMDA data. 

HOW HAS THE LENDING ROLE OF THE EIGHT LARGEST DEPOSITORY 

BANKS CHANGED SINCE 1992? 

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In 1992, eleven large banks in the Rochester MSA accounted for almost 65% of the 

HMDA lending. Three of those 11 banks no longer exist, since other banks acquired 

them. In 1997, the eight remaining largest banks accounted for only 31% of the HMDA 

lending in the MSA. By the end of 1999, only seven of the original eleven banks will 

exist, with Central Trust, Columbia Savings, First Federal and First National Bank having 

been acquired by the other remaining 7 banks. 

This reflects a national trend. Nationally the number of commercial banks and savings 

associations has declined more than 40% between 1975 and 1997.5 Furthermore, 

depository institutions with branch presence are no longer the primary source of 

mortgage originations in their communities. 

In 1997,31% of the HMDA loans in the Rochester MSA were originated by the 

eight institutions included in this report. Ten mortgage banks originated another 

19% of the HMDA loans, while 10 sub-prime lenders originated 12%. The 8 largest 

credit unions generated another 10% of the HMDA loans. Over 100 smaller local 

banks, mortgage banks and smaller credit unions accounted for the remaining 28% 

of the originations.6 

4 Banks, savings and loans. credit unions with assets over S 10 million and mortgage companies that are 

owned by depository institutions or their holding companies are required to report HMDA data to the 

Federal Financial Instimtions Examimui on Council (FFIEC). Independent mortgage companies that make 

at least 100 home purchase loans a year are also required to report HMDA data. In 1997,there were over 

150 institutions that reported HMDA data in the Rochester MSA. A glossary of these terms is found at the 

end of this report. 

5 See Robert B. Avery, Raphael W. Bostic, Paul S. Calem. “Trends in Home Purchase Lending.” Federal 

Reserve Board Bulletin February 1999. 

6.The data used in this analysis was primarily obtained from HMDA data released by the FFIEC. Some 

data was obtained from reports generated by RTKNET a data service of OMB Watch. Nearly all 

commercial banks. savings and loans associations, credit unions, and mortgage banks, with assets of more 

than S 10 million and an office in an MSA are reqired to report each mortgage purchased and each loan 

application. 

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l The 10 largest banks saw their market share decline from 56% in 1993 to 31% 

in 1997. 

l The 10 largest sub-prime lenders saw their market share increase from 1% in 

1993 to 12% in 1997. 

l The 8 largest credit unions saw their market share increase from 3% in 1993 to 

11% in 1997. 

The mortgage banks have not seen as dramatic a change in their market share. This has 

important consequences for the work of the Coalition because many of the mortgage 

banks, credit unions, as well as subprime lenders, are not sub,ject to the Community 

Reinvestment Act 

At the time of the writing of this report, financial modernization legislation is making its 

way though Congress. The current bills in the House and the Senate would eliminate 

many of the distinctions between banks, insurance companies and securities tirms. 

Community advocates are lobbying hard to ensure that as more non-depository 

institutions engage in lending activities, community reinvestment obligations should be 

extended to them. Financial companies that are affiliated with banks, as well as non-bank 

financial institutions, must be sub%ject to CRA requirements. 
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SINCE 1992, LENDING RATES FOR CITY RESIDENTS, BLACK AND 

HISPANIC HOUSEHOLDS AND LOW -MODERATE INCOME PEOPLE HAVE 

IMPROVED. 

Since 1992, there has been a significant improvement in the lending rates for city 

residents, Black, Hispanic and low-to moderate-income households. 

Lending by all HMDA lenders in 1997, compared to 1992: 

l Increased in the MSA by 9%. 

l Increased in the City by 94%. 

l Increased to Black/Hispanic households by 123%. 

l Increased to low-moderate income households by 72%. 

l Increased in low-moderate income census tracts by 41%. 

l Increased in minority census tracts by 139%. 

It is important understand what role the eight largest area lenders played in these 

increases. Between 1992 and 1997, the eight largest banks with branch presence in the 

MSA (including their acquired institutions) saw: 

l a 46% decrease in their HMDA lending in the MSA; 

l a 33% decrease in their HMDA lending in the City; 

l a 38% increase in their lending to Black/Hispanic households; 

l a 5 % decrease in their lending in minority census tracts; and 

l a 19% decrease in their lending in low-moderate income census tracts. 

Overall, the number of HMDA loans has increased since 1992. However, the top 8 area 

banks made almost 7,000 fewer HMDA loans in 1997 than in 1992. The increase in 

lending was accounted for by the other financial institutions serving the marketplace. The 

slack caused by the decline in bank lending was made up by credit unions, mortgage 

banks, out-of-state banks and sub-prime lenders. 

Despite the fact that the top 8 institutions saw a decline in their HMDA lending since 

1992, a greater proportion of their lending in 1997 was in the City, to Black and Hispanic 

households, and in low moderate and minority census tracts. 

In 1997, of the total loans originated by the eight largest area banks in the Rochester 

MSA: 

l 15% were in the City, up from 12% in 1992. 

l 7% were to Black/Hispanic households, up from 3% in 1992. 

l 15% were in low-moderate income census tracts, up from 5% in 1992. 

l 4% were in minority census tracts, up from 2% in 1992. 
These changes in the marketplace are significant and raise questions that the Coalition 

will continue to pursue. 

SUB-PRIME LENDING 

To understand the changing nature of the marketplace, we need to look at the role played 

by sub-prime lending institutions. The ten largest subprime lenders increased their 

lending by 608% from 1993-1997. Their market share in the MSA increased from 

1.3% in 1993 to 1;L% in 1997.. ’ 

Although these 10 lenders do not account for all the sub-prime lending in the MS4 it 

appears that they account for a substantial majority. While these 10 lenders only had 

12% of the MSA market share, they had: 

l 26% of the Black/Hispanic household market share. 

l 17% of the low-moderate household market share. 

l 28% of the market share in low-moderate income census tracts. 

l 41% of the market share in minority census tracts. 

These 10 sub-prime lenders originated over 3,000 HMDA loans in the MSA in 1997. 

However, most of these loans were not for home purchase (FHA and conventional). Of 

the loans originated by these 10 sub-prime lenders: 

l 30% were for home purchase loans. 

l 25% were for home improvement loans 

l 45% were refinances. 

Looking at the income characteristics of the sub-prime applicants is informative. 

There is a significant possibility that many of the borrowers would have qualified for 

loans from traditional lenders. Somewhat surprisingly, more than half the loans were 

originated to households with incomes >80% of the area median. Only 41% of subprime loans were originated to low-moderate income households. _ 

Thirty-two percent of the loans originated by sub-prime lenders were in low-moderate 

income census tracts, while only 16% were in minority census tracts. The relatively 

low percentage of originations in minority census tracts may be explained, in part, by 

lower homeownership rates among minority households. Table 1 provides a graphic 

breakdown of the characteristics of these borrowers. 

’ The ten sub-prime lenders with the most number of originations in the MSA are: Greentree. Ford CF. 

Homestead Financial and Homestead Funding, The Money Store, United Companies, Alliance Mon.. 

Parkway Mon., Residential Money. First Union HEB, Equicredit Corp. Sub-prime lenders have been 

identified as such based on a list of lenders provided by HUD. Home Equity loans are not reported as 

HMDA loans; the numbers and percentages included do not capture such loans. Not ail loans by ‘subprime’ lenders will necessarily have higher interest rates or lower underwriting standards. 
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We are able to document the decline in lending by the area banks since 1992, however 

the corresponding increase in lending by sub-prime lenders can only be tracked from 

1993, as not all sub-prime lenders and mortgage bankers reported data prior to 1993. 

Sub-prime lenders typically charge higher interest rates and origination fees than 

traditional lenders. They have also been associated with lending to low income and 

minority households and applicants with poorer credit histories. However, in Rochester, 

the recipients of sub-prime loans appear to be predominantly White and upper middle 

income applicants. These applicants may either have poor credit histories or be unaware 

that they are paying more than is necessary for their credit. Alternatively, since most of 

the loans are refinance or home improvement, the applicants may be homeowners who 

have seen a decline in the value of their property. Sub-prime lenders may be more willing 

to be more generous in their appraisals or accept a higher loan to value ratio. That might 

explain the income and racial makeup of the sub-prime market in the MSA. 

Fannie Mae recently concluded that 35% of all sub-prime loans could be under-written 

using traditional guidelines. * If that percentage is true for the Rochester market, then 

there is work to be done in educating the community to shop for better interest rates. 

Arguably, sub-prime lenders have a place in the competitive market place. The cause for 

concern arises if mortgage applicants have to resort to such lenders because non-market 

factors such as racism, real or perceived, leads them to fail to apply for a traditional loan 

that they may be eligible for. Alternatively, lack of financial sophistication in an 

applicant may result in the applicant paying more in interest than he had to. Applicants 

with poor credit may also choose to obtain a higher interest rate loan, rather than 

undertake the credit counseling necessary to obtain a traditional loan. We need to study 

this issue further and work with the traditional lenders in the market to ensure that 

applicants are not resorting to expensive credit as a result of a lack of information, 

Sub-prime lenders are not subject to CRA. However, they are subject to a host of 

consumer protection laws. If a sub-prime lender is engaging in illegal, predatory 

lending practices, the consumer may need to resort to legal action to enforce his 

rights. 

* Karen Hube March 18 1998. ‘In the wild west of subprime lending borrowers have to dodge man! 

bullets” Wall Street Journal. 

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MORTGAGE BANKS 

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The ten mortgage banks with the largest number of loans in the Rochester MSA in 

1997 accounted for 19% of the total number of HMDA originations.9 

The ten mortgage banks increased their lending by 16% from 1993-1997. 

Their market share in the MSA increased from 12% in 1993 to 19% in 1997. Unlike 

the sub-prime lenders, which had a much smaller market presence in 1993, mortgage 

banks were major lenders in 1993. However, six of the mortgage banks which made the 

top ten list in 1993 saw their lending decline by more than 50% by 1997. lo On the other 

hand, five of the top ten lenders in 1997 had a much smaller or no market presence in 

1993.” 

While these 10 lenders accounted for 19% of the MSA market share, they originated: 

l 16% of the Black/Hispanic market share. 

l 18% of the market share to low-moderate income households 

l 11% of the market share in low-moderate income census tracts. 

l 9% of the market share in minority census tracts. 

In 1997 these 10 mortgage bankers originated 4,896 HMDA loans in the MSA. Unlike 

the loans originated by the sub-prime lenders, most of these loans were for home 

purchases. (FHA and conventional). Of the loans originated by these 10 mortgage 

bankers: 

l 85% were for home purchase loans. 

0 15% were refinances. 

Looking at the race and income characteristics of applicants and neighborhoods to whom 

and where these mortgage bankers originated loans are informative. Less than 10% of 

originations by mortgage banks were to Black/Hispanic households, in low-moderateincome and minority census tracts. 

l 5% were to Black! Hispanic households. 

l 27% were to low-moderate income households. 

l 8% were in low-moderate income census tracts. 

0 2% were in minority census tracts. 

The Coalition will continue to examine the role of mortgage banks in HMDA lending in 

the Rochester MSA. 

’ Nothagle. Resources BMG, Nor-west Mortgage, PHI-I, Countqwide, Source One Mortgage. First Union 

MC, GMAC. NVR Mortgage, PNC Mortgage. 

” Source one. PNC mortgage. NVR mortgage, Midcoast Mortgage, Greater Funding GE Capital 

Mortgage, Power funding. 

” Countrywide, PHH, Resources BMG, First Union MC and IMC Mortgage. 

9 
HMDA LOANS 19954997 

HOW DID BLACKS AND HISPANICS FARE? 

Lending to Black and Hispanic households in the Rochester MSA went up 12% from 

1995 to 1996, but remained unchanged between 1996 and 1997. Nationally, HMDA 

loans to Blacks and Hispanics only increased by 4% in 1997, down from the double digit 

increases posted through most of the 90’s. Buffalo, the nearest comparable market, saw a 

12% decrease in loans to Black and Hispanic applicants in 1997. 

However, there is still a lending gap for Blacks and Hispanics in Rochester. Whereas 

10% of the MSA is comprised of Black and Hispanic households, only 6% of the total 

number of loans originated were to Black and Hispanic households in 1997. A slightly 

higher percentage (7.5%) of all applicants were Black and Hispanic. 

In comparison, 82% of the total number of loans originated were to White applicants, 

even though only 72% of applicants in the MSA were White. 

Homeownership in the Black and Hispanic community continues to lag. Whereas 

nationally, 72% of White households own their homes, only 45% of Black families are 

homeowners. 

In the City of Rochester, which houses most of the minority population of the MSA, onlv 

3 1% of Black households are homeowners. Nationally, minorities contributed 42% of the 

growth in homeownership between 1994 and 1997. Rochester, with its unusual 

combination of affordable housing and high rent costs, has the potential for untapped 

marketing opportunities among minority home buyers. 

LOANS IN MINORITY CENSUS TRACTS 

I-IMDA lending in minority census tracts has increased significantly since 1992. In 1997, 

there were over 1,200 loans in census tracts where the minority population was greater 

than 50%. That represented a 21% increase over 1995. It also represents a 125% 

increase over 1992 numbers, the first year for which the Coalition identified lack of 

lending in minority census tracts as an issue. Lending in census tracts where the minority 

population is greater than 80% increased between 1992 and 1996 by 186%. This is a 

significant achievement and one that needs to be maintained. 

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ILLOANS TO LOW-MODERATE HOUSEHOLDS 

% of HMDA loans to low-moderate income households in the Rochester MSA 

1992 1995 1996 1997 

19% 32% 27% 30% 

HMDA lending to low-moderate income households in the MSA has increased 

significantly since 1992. 

Lending to low-moderate households in the MSA went down in 1996 to 27%, but went 

up in 1997 to 30%. Whereas 22 % of the MSA is comprised of low-moderate 

households, in 1997,37% of the loan applicants were low-moderate income and 30% of 

all loans in the MSA were originated to low-moderate households. This is a significant 

increase from 1992 when only 19% of HMDA loans were originated to low-moderate 

income households. 

In comparison, 63% of the applicants, in 1997, were upper income and 70% of the total 

number of loans were originated to upper income applicants. 

WHAT ACCOUNTED FOR THE CHANGE IN LENDING IN THE CITY? 

Lending in the City has increased 94% between 1992 and 1997, peaking in 1994, but 

declining since then. The decrease in lending in the City raises questions. An analysis of 

the type of loans originated in the City provides insight into the downward trend in 

lending. Changes in the reporting of home improvement loans, as well the increased 

prevalence of home equity loans, which are not reported as HMDA loans, may account 

for some of the decrease. 

In the City in 1997: 

l There was a 16% increase in FHA loans from 1995; 

l There was a 30% decrease in conventional loans from 1995; 

l There were over 1,800 home purchase (FHA and conventional) loans, a 13% 

decrease from 1995; 

l There was a 77% increase in refinance loans from 1995; and 

l There was a 35% decrease in home improvement loans from 1995. 

11 
i - 

- 

The increased prevalence of home equity loans requires us to be care&l when comparing 

HMDA loans over time. Home equity loans are increasingly used for paying for home 

improvements, but since they are also used for consumer purchases they are not reported 

under HMDA data. %rthermore, some financial institutions no longer report home 

improvement loans. 

If we include home improvement loans when comparing 1996 to 1997, HMDA lending in 

the City declined by 11%. Otherwise, lending in the City was flat. We have to recognize 

that there are some limitations to using statistical data and look at programmatic changes 

as well. The larger area banks have introduced new products and services and they are 

discussed below at page 15. 

HOME IMPROVEMENT LENDING 

The HMDA data for home improvement loans throughout the city is revealing. In 1997. 

there were 2,777 applications for home improvement loans in the city. Of that number 

31% or 873 loans were originated; 52 % (1,454) of applications were denied; and 450 

(16%) applications were approved but not accepted, withdrawn, or files closed for 

incompleteness. This is an issue that requires fi_nther exploration and study. 

l2 HMDA requires that an institution report Home Improvement @U) loans in its HMDA data if the 

institution has a specific HI product or if it tracks that the loan is for HI. If the instition does not have a 

HI product or track the loan purpose, the HI loan is not reported. Based on that rule Chase stopped 

reporting HI loans in mid -1996. 

12 
I - 

LOAN DENIALS 

- 

Examining the difference between Black, Hispanic and White denial rates is illustrative, 

Black Households had a denial rate (45%) that was almost twice the denial rate for White 

households. Hispanic households did a little better (34%). 

-_ 

In 1997: 

l Black households had a denial rate of 45%, as compared to White households, which 

had a denial rate of 24%. Blacks were denied all HMDA loans 1.9 as often as Whites. 

l However, the Black denial rate for conventional loans was 23%, 8% higher than the 

White rate of 15%. The denial ratio between Blacks and Whites for conventional 

loans was 1.5:1 

l Hispanic households had a denial rate of 34%, as compared to White households, 

which had a denial rate of 24%, resulting in a Hispanic to White denial rate of 1.4 for 

all HMDA loans. 

l The denial rate for conventional loans for Hispanic applicants was 28%, almost twice 

the White rate of 15%. 

l More than half the applications by Black applicants for refinancing and home 

improvement loans were denied (57 and 56%). 

l 30% of White applications for refinancing were denied. 

Did upper income blacks have lower black to white denial ratios than lower income 

blacks? 

Black household incomes continue to lag behind White household incomes. There is 

obviously some link between an individual’s income and their ability to access credit. 

Lower income people will often have fewer monetary resources to deal with a life crisis 

and, therefore, are more likely to have problems with their credit. However, the 

difference in denials between Black and White applicants did not decrease at higher 

income levels. 

The chart below compares the percentage of HMDA denials between Asian, Black, 

Hispanic and White applicants at different income levels. Denials ratios are compared for 

Asian, Black and Hispanic applicants with White applicants at ~80% median income - 

13 
I - 

~120% median income. J3The Black to White denial ratio was actually higher for uppel’ 

income Black applicants than lower income Black applicants for I-MDA loans in 1997. 

l 51% of Black applicants below 80% of area median income were denied I-MDA 

loans as opposed to 35% of white applicants at the same income level. The Black to 

White denial ratio at that income level is 1.5. 

l The Black to White denial ratio for black applicants at 120% of median income is 

2.635% of Black applicants above 120% of area median income were denied 

I-MDA loans, as opposed to 14% of White applicants at that income level. 

For Black applicants the Black to White denial ratio increases as their income goes 

UP. 

The Black to White denial ratio has, however, improved compared to 1993. In a report 

released by GRCRC on 1993 HMDA denials, the Black to White denial ratio was 2:l for 

applicants below 80% of median income and 3.5: 1 for applicants at 120% of median 

income. 

Hispanic applicants, on the other hand, had a lower denial ratio than Black applicants in 

1997. Hispanic applicants at 80% and 120% of median income had a 1.2 Hispanic to 

White denial ratio. Hispanic applicants at 120% of median income had a denial rate of 

only 17%. 

Asian applicants at 80 % of median income had the same rates of denials as Whites at 

that income level. They had lower denial rates than White applicants at higher income 

levels. Only 10% of Asian applicants at 120% of median income were denied. 

The Coalition recognizes that as banks reach out to the minority and low-moderate 

income community and a more diverse pool of applicants applies for loans, the denial 

rate will be affected. In 1997, Black applications for all I-MDA loans increased by 339; 

Hispanic applications increased by 40% compared to 1995. The increase in the 

applications was caused by more applications for refinances and home improvement 

loans 

I3 In 1997. median income was %37,200. 80%of Ml was $37,760 and 120% of Ml wasU6.000 

14 
Income 1 

~80% I IAsian 

/Black . . . 

en. IWhite Ratio ) 

Rochester MSA Denials 1997 

[Applications Originations Denials % D( 

110 5% 3% 35% 

1,569 605 795 51% I __a IHIspanic I 3721 1591 43%1 

-99% /Astan I 471 101 21%l 0.91 

I I 

1% IAsian I 371 -271 51 14%l n7 

I 

IOO-119-' ‘- ’ 

I 

Black 

Hispanic 

White 

>1209’ f0 IAsian - . 

IBlack 

LI. . . . I 

L 

lntspamc 1 

1 White 

lU4j 41%/ 

1 rl a__. 

2.11 

I 

-- 

.._ w. I 

255 119 _,,I .._.: 

51 35 Z/Y0 1.4 

4,020 2,226 7;; 20% 

1441 11-l 

v. I 

_ 

10,956j 8,345( 1,4841 14%/ 

IA1 n 71 

1081 181 17%1 1.21 

WHERE HAVE WE COME SINCE 1992? 

The mortgage lending market has changed dramatically in the last five years. The 8 

largest area depository institutions are no longer the major players in the marketplace. 

Mortgage bankers, sub-prime lenders and credit unions, have usurped their role. 

Unfortunately, virtually none of these non-bank entities have CRA obligations. 

The Coalition has worked with area banks to improve their HMDA lending. Area banks 

have introduced a number of programmatic changes. These changes include: 

l The institution of credit counseling programs for first-time homebuyers. 

l A Second review policy for denied HMDA loans. 

l Affordable mortgage products for first- time homebuyers. 

l Affirmative marketing of products. 

The area banks have to be given credit for maintaining or increasing the percentage of the 

loans they originated in the City, to Black/Hispanic and low-moderate households, and in 

low-moderate and minority census tracts. The market is more competitive and we must 

recognize that fact. We must also look at the presence of sub-prime lenders in our 

community and see whether some of that lending can be accomplished through more 

traditional market outlets. 

15 
HOW DID ROCHESTER COMPARE WITH OTHER COMMUNITIES? 

The National Community Reinvestment Coalition recently released an analysis of home 

mortgage lender performance in the twenty largest metropolitan areas over a four year 

time period. I4 The study found that, in most metropolitan areas, the minority loan share 

was either equal to or a little less than the minority population share. On the other hand, 

the share of loans to low-moderate households was lower than the percentage of lowmoderate households in those areas. 

- 

The trend in the twenty largest metropolitan areas was not the same as the pattern in 

Rochester. In Rochester, minority households received fewer loans and lowmoderate households received a greater number of loans than their proportionate 

share of the total population. The Coalition applauds the improvement in lending to 

low-moderate households. We need to work harder at reaching the minority community 

as well. 

HOW DID ROCHESTER COMPARE WITH BUFFALO? 

HMDA lending to traditionally under-served populations has improved more 

significantly in Rochester than in Buffalo since 1992. This is true, both in terms of the 

eight largest area banks, as well as lending by all financial institutions. 

Table 1 compares the changes in HMDA lending between Rochester and Buffalo 

between 1992 and 1997. It compares the changes in the number loans originated by all 

financial institutions (AFI), the eight largest depository institutions in Rochester (listed 

on the chart) and all other financial institutions (i.e. all those not including the eight 

largest banks). 

Looking at the lending pattern of all financial institutions between 1992 -1997: 

- 

l Lending in the MSA was up 9% in Rochester and down 3% in Buffalo. 

l Lending to Black/Hispanic Households was up 123% in Rochester and 34% in 

Buffalo. 

l Lending in minority census tracts was up 139% in Rochester and 38% in Buffalo. 

l Lending in low-moderate income census tracts was up 41% in Rochester and 3 1% in 

Buffalo. 

The eight largest banks in Rochester also have a market presence in Buffalo. Looking at 

the lending pattern of the eight largest banks: 

l In 1997, these eight banks had 31% of the market share in Rochester and 42% in 

Buffalo. 

I4 America’s Best and Worst Lenders NCRC January 1999. 

16 
Between 1992 and 1997: 

l Lending by the eight largest banks in the MSA was down 46% in Rochester and 36% 

in Buffalo. 

l Lending by the eight largest banks to Black/Hispanic households was up 38% in 

Rochester and down 25% in Buffalo. 

l Lending by the eight largest banks in minority census tracts was down 5% in 

Rochester and down 42% in Buffalo. 

l Lending by the eight largest banks in low-moderate income census tracts was down 

19% in Rochester and down 31% in Buffalo. 

However, as observed above, these eight institutions doubled the proportion of their 

total loans to Black/Hispanic and low-moderate households and in minority census tracts 

in the Rochester MSA. In comparison, the increases by these eight institutions to 

black/Hispanic and low-moderate households in the Buffalo MSA were more modest. In 

the Buffalo MSA the proportion of the total loans of the eight largest banks to 

Black/Hispanic and low-moderate households only increased by l%, and decreased by 

1% in minority census tracts in the Buffalo MSA. 

Looking at the changes in lending rates to the low and moderate income and minority 

community in these two markets shows some interesting trends. Significantly greater 

gains occurred from 92-97 in Rochester in lending to Black and Hispanic households, and 

in minority and low-moderate income census tracts, both with regard to the total lending 

and with regard to the same eight largest banks. 

The City of Rochester has used a variety of mechanisms to increase community 

development lending in our community. Many not-for profit organizations have been 

provided with operational support to develop affordable housing. The City has created 

housing programs of its own and funded pre-purchase counseling, as well as programs for 

down payment assistance. 

The City has also worked closely with GRCRC to encourage the banks to ensure that 

their community development activities are a success. Rochester has an active Coalition 

that has regular ongoing discussions with seven of the eight area banks. The Coalition has 

obtained written commitments regarding a number of community reinvestment activities 

from three of the area banks. The Coalition also monitors the national lending 

commitments of two other area banks. All of these activities may account in part for the 

difference in lending patterns between Rochester and Buffalo. 

17 
Looking at the lending pattern of all the other financial institutions” (excluding the . 

eight largest banks), between 19931997: 

l Lending in the MSA was up 102% in Rochester and 171% in Buffalo. 

l Lending to Black/Hispanic households was up 253% in Rochester and 233% in 

Buffalo. 

l Lending in minority census tracts was up 447% in Rochester and 273% in 

Buffalo. 

l Lending in low-moderate income census tracts was up 116% in Rochester and 

190% in Buffalo. (However, there were more loans of this type in Rochester (2,502) 

than in Buffalo (2.018). 

Comparing the rate of HMDA loans per 1,000 households in Buffalo and Rochester is 

illustrative. The rate described below is the rate of FHA and conventional loans 0,000 

Households. 

In 1997: 

l The Rochester MSA had a rate of 68 loans /I,000 households (HH). Buffalo had a 

rate of 48 loans /l,OOO HI-T. 

l Black/Hispanic HH in Rochester had a loan rate of 40/1,000 HH, while the rate for 

Buffalo was 27/1,000 HH. 

l Low-moderate income HH in Rochester had a loan rate of Sl/l,OOO, in Buffalo the 

rate was 33/1,000 HI-I. 

1997 ROCHESTER/ BUFFALO COMPARISION 

The Rochester MSA had a significantly higher rate of loans per 1000 HH for 

Black/Hispanic and low-moderate households. The disparity between Rochester and 

Buffalo was the greatest: Rochester rates of loans per 1000 HH were 30% higher than the 

Buffalo rates per 1000 HH. 

Rochester has a stronger economy than Buffalo. Rochester also has a higher median 

household income than Buffalo. Therefore, a household classified at 80% of area median 

income will have a higher annual income in Rochester than in Buffalo. 

Is As mentioned above some mortgage bankers did not report data in 1992 and their loans were not 

included in the reported HMDA loans. 

18 
- 

- 

It is possible to calculate a homeownership affordability index based on the median house 

price in the MSA. That figure is based on the lowest possible annual income that a 

household must have to be able to become a homeowner when purchasing a median 

priced home. Based on that index, it is possible to ascertain how many households in an 

MSA can potentially qualify for a mortgage (based on income alone). Obviously, income 

alone is not used in qualifying for a mortgage. A household’s debt- to- income ratio, as 

well as credit history, are factors to be considered. Using 1990 census data, we calculated 

the percentage of Black households for whom homeownership was potentially affordable, 

based on income alone. 

40% of Black households in Rochester and Buffalo have the income qualifications for 

homeownership. If all income eligible Black households in Rochester could qualify 

for home mortgage loans on the basis of income, other debt and credit history their 

home ownership rate would increase to 40%. The current rate of homeownership 

for Black households in Rochester is 31%. Given that income levels have gone up 

since 1990 and housing prices have come down, it is conceivable that even more 

Black households can afford homeownership. 

Rents are high in Rochester. Homeownership is an affordable option for eligible 

applicants. This is one of the strongest possible arguments for ensuring that credit 

counseling is readily available to all applicants for I-IMDA loans. 

19 
I I 
I- 

- 

RECOMMENDATIONS 

- 

- 

One of the goals that the Coalition will work toward in the next few years is a regional 

financial literacy campaign. Area banks, the city, the county and community groups 

working on affordable housing could play an important role in making credit more 

accessible. Credit counseling and repair should be made available and accessible to all 

potential low and moderate income applicants who are eligible and interested, 

Information should be readily available to homebuyers about the cost of obtaining higher 

interest loans when lower cost alternatives are available when accompanied by credit 

repair. 

Such an educational initiative is in the interest of all concerned. It enables area banks to 

educate potential homeowners of the advantage of conventional loans, as opposed to 

more expensive sub-prime loans. It is also in the interest of the city and the county to 

ensure that homeowners are not accessing capital at an unnecessarily prohibitive cost. 

Expensive credit results in a higher likelihood of foreclosure. Homeowners with lower 

housing costs also have more in disposable income, which has a beneficial effect on the 

economy of the region as a whole. 

21 
- 

- 

- 

PartlB 

COMPARISION OF LENDING OF EIGHT MAJOR ROCHESTER BANKS 

This report includes an analysis of the home mortgage loans originated by the eight 

largest depository institutions serving the Rochester MSA. They are Chase Manhattan, 

Citibank, Charter One (RCSB), First National Bank, l6 Fleet, Ke 

Marine Midland Bank (HSBC) and their mortgage subsidiaries. 17 

Bank, M & T and 

Table 2 provides a 

breakdown the HMDA loans of the eight largest banks as well as marketshare 

comparisons. Table 3 compares the denial rates of these banks. 

1997, of the eight banks included in this analysis: 

HSBC had the highest number of HMDA loans in the MSA, the City of Rochester, to 

low-moderate income households and low-moderate income and minority census 

tracts. 

M & T had the highest number of HMDA loans to Black/Hispanic households in the 

MSA. 

Citibank had the fewest number of Hh4DA loans in the MSA, the City of Rochester. 

to low-moderate income and Black/Hispanic households and low-moderate income 

census tracts. 

FNB had the highest % of its total MSA loans originated in the city, to 

Black/Hispanic households and in minority census tracts. 

Key had the highest % of its total MSA loans originated to low-moderate-income 

households and low-moderate income census tracts. 

Key had the lowest % of its total MSA loans originated in the City. 

Fleet had the lowest % of its total MSA loans originated to Black/Hispanic 

households and in minority census tracts. 

Citibank had the lowest % of its total MSA loans originated to low-moderate income 

households in the MSA. 

Chase had the lowest % of its total MSA loans originated to low-moderate income 

census tracts. 

I6 M & T has a pending application to acquire FNEK 

” These 8 banks are included in the analysis because they are the eight largest Hh4DA lenders which accept 

deposits in the Rochester MSA. Other banks also originate HMDA loans in the MSA but do not have 

branch presence. 

22 
- 

- 

-.. 

The data included in the analysis was shared with each of the banks in question while still 

in draft form. Each bank was provided with the opportunity to meet with Coalition 

members in person and respond to their own data. The responses of individual banks to 

the report are included where applicable. 

23 
I I 

MSA 25,660 

City 3,779 

Black/Hispanic HH MSA 1,507 

Low-Mod HH MSA 7,583 

Lod-Mod Income CT 3,673 

Minority CT 1,203 

Non-Occupant 940 

MARKETSHARE 

MsA 

City 

Black/Hispanic HH USA 

Low-Mod HH MSA 

ILow-Mod Income CT 

~ Minority CT 

Non-Occupant 

Loans as % 

of M&A TOTAL IN: 

City 

BlacMHispanic HH MSA 

Low-Mod HH MSA 

Low-Mod Income CT 

Minority CT 

Non-Occupant 

AFI: All Financial lnstitions 

OFI: Other Financial lnstitions 

GRCRC 1999 

1 AFI 

15% 

6% 

30% 

14% 

5% 

4% 

I I 

Top 8 Banks 

Rochester, NY 

1997 HMDA Loans 

Charter One Chase I Citibank / FNB 

1,119’ 573, 372 527 

198’ 77~ 52! 124 

102 32 28/ 67 

340’ 149 781 157 

I 

I 

t/ 

1 

, 

1 

I 

, 

, 

, 

, 

, 

, 

, 

‘I 

‘i 

I 

136 

66 

16 

Charter One 

4% 

5% 

7% 

4% 

4% 

5% 

2% 

Charter One 

18% 

9% 

30% 

12% 

6% 

1% 

60 

39 

28 

Chase 

2% 

2% 

2% 

2% 

2% 

3% 

3% 

Chase 

13% 

6% 

26% 

10% 

7% 

5% 

53 84 

16 36 

4 11 

Citibank 

1% 

1% 

2% 

1% 

1% 

1% 

0% 

FNB Fleet 

2% 5% 

3% 3% 

4% 3% 

2% 4% 

2% 4% 

3% 1% 

1% 4% 

Citibank 

14% 

8% 

21% 

14% 

4% 

1% 

FNB 

24% 

13% 

30% 

16% 

7% 

2% 

r Fleet I- Key 

I 1 I I ~ 

M&T Marine 

1.179 932 1,295 1,981 

126 92 237 282 

41 49 138 110 

310 331 432 627 

154 253 175 256 

14 26 61 69 

33 14 37 81 

Key 

4% 

2% 

3% 

4% 

7% 

2% 

1% 

M&T 

5% 

6% 

9% 

6% 

SW 

5% 

4% 

1 

, 

, 

, 

, 

, 

, 

, 

, 

, 

Marine 

874 

7% 

7% 

8% 

7% 

6% 

9% 

Fleet 

11% 

3% 

26% 

13% 

1% 

3% 

Key 

10% 

5% 

36% 

27% 

3% 

2% 

M&T 

18% 

11% 

33% 

14% 

5% 

3% 

, 

, 

,I 

Marine 

14% 

6% 

32% 

13% 

3% 

4% 

/ i 

/ 

, 

, 

, 

, 

, 

I 

, 

, 

, 

, 

, 

, 

, 

i 

Top 8 / OFI 

7,978 17,682 

1,188 2,591 

567 94c 

2,424 5,15E 

1,171 2,504 

327 87E 

224 7lf 

31 6: 

31 6! 

38 6: 

32 64 

32 61 

27 6: 

24 7t 

15% 

7% 

30% 

15% 

4% 

3% 

15% 

54 

29% 

140, 

345 

45 

Tahlo 7 
e - 

BANK 

CHARTER ONE 

WHITE % 

26 

RATIO B-W 

1.7 

BLACK % RATIO H-W HlSPANtC % 

45 1.8 47 

CHASE 18 3.0 54 2.2 39 

CITIBANK 14 1.6 23 0.9 12 

FIRST NATIONAL 9 1.4 13 0.0 0 

FLEET 28 1.5 43 1.1 30 

KEY BANK 23 1.8 42 1 .o 24 

M&T 20 1.8 35 1.5 29 

MARINE MIDLAND 15 2.0 30 3.2 48 

TABLE 3 
CHASE 

- 

- 

_- 

In 1997: 

Loans in MSA: There was a 6% increase from 1995. 

Loans in City: There was a 48% decrease from 1995 (only 77 loans), 

Loans to Blacks/Hispanics: There was a 65% decrease from 1995(only 32 loans). 

Loans to Low-Moderate Households: There was a 10% increase from 1995. 

Loans in Low-Moderate Census Tracts: There was a 18% decrease from 1995 (only 60 

loans). 

ROCHESTER LOAN ORIGINATIONS’s 

l In 1997, Chase had $1.2 billion in deposits in the Rochester MSA. It was ranked 

third in terms of local deposits, Chase ranked sixth out of eight banks in the total 

number of HMDA loans originated in the MSA. 

l Chase’s assessment area covers 75% of the census tracts in the Rochester MSA, 

including Monroe County. 

I8 The HMDA numbers for Chase do not include Home Improvement loans. Chase stopped reporting Home 

Improvement loans in 19%. To ensure that the comparison was accurate Home Improvement loans were 

excluded. 

26 
- 

l In 1997, a smaller percentage of the total loans in the MSA were in the City, Black 

and Hispanic households and in low-moderate income census tracts. 

l Only 10% of total loans originated in the MSA were in low-moderate income census 

tracts, the lowest percentage of all banks compared in this report. 

l In 1996 and 1997, denial rates for Black and Hispanic applicants were higher than 

1995. In 1997, 54%of Black applicants were denied loans. Chase had the worst 

denial rate for Black applicants of all banks compared in this report. 

The Coalition raised the decline in lending with Chase. In response Chase pointed out 

that Chase had hired a community development lender to improve HMDA lending in the 

Rochester market. Preliminary 1998 numbers appear to reflect that improvement. 

27 
-. 

- 

- 

CITIBANK 

In 1997: 

Loans in MSA: There was a 34% decrease from 1995. 

Loans in City: There was a 51% decrease From 1995 (only 52 Loans). 

Loans to Blacks/Hispanics: There was a 15% decrease from 1995 (only 28 loans) 

Loans to Low-Moderate Households: There was a 51% decrease from 1995. 

Loans in Low-Moderate Census Tracts: There was a 2% decrease from 1995. 

ROCHESTER LOAN ORIGINATIONS 

l In 1997 Citibank had $481 million in deposits in the MSA, and ranked 7* in terms 

of deposits. Citibank’s assessment area only included Monroe County in the 

Rochester MSA. Citibank ranked last of all eight banks in the total number of 

loans originated in the MSA. 

l In 1997, a higher percentage of the total loans in the MSA were originated in lowmoderate-income census tracts. However, only 21% of total loans originated in the 

MSA went to low-moderate income households, the lowest percentage of all the 

banks compared in this report. 

l In 1997, denial rates for Black and Hispanic applicants were lower than in 1995. In 

1997, only 23% of Black applicants were denied loans. Hispanic applicants had a 

lower denial rate than White applicants. However, only 28 loans were originated to 

Black and Hispanic applicants. 
- 

- 

- 

CHARTER ONE 

In 1997: 

Loans in MSA: There was a 2% decrease from 1995. 

Loans in City: There was a 11% increase from 1995 

Loans to Blacks/Hispanics: There was a 2 % increase from 1995. 

Loans to Low-Moderate Households: There was a 0.3% decrease from 1995. 

Loans in Low-Moderate Census Tracts: There was a 3% increase Corn 1995 

ROCHESTER LOAN ORIGINATIONS 

In 1997, Charter One had $1.9 billion in local deposits, and ranked Znd in terms of 

deposits. Charter One ranked third of all eight banks in the total number of loans 

originated in the MSA. 

Charter One’s assessment area includes Monroe, Ontario and Wayne counties in the 

Rochester MSA. 

In 1996 and 1997, Charter One maintained its rate of HMDA lending in the MSA, in 

the City, to Black/Hispanic households, to low-moderate income households and in 

low-moderate census tracts compared to 1995. 

In 1997, 30% of the total loans in the MSA went to low - moderate income 

households. 

In 1996 and 1997, denial rates for Black and Hispanic applicants continued to be 

over 40% and almost twice the White denial rate. 

29 
EL 

- 

FIRST NATIONAL BANK 

In 1997: 

Loans in MSA: There was a 75% increase from 1995. 

Loans in City: There was a 75% increase from 1995 

Loans to Blacks/Hispanics: There was a 103% increase Tom 1995 (still only 67 loans) 

Loans to Low-Moderate Households: There was a 83% increase from 1995. 

Loans in Low-Moderate Census Tracts: There was a 79% increase from 19% (still 

only 84 loans). 

ROCHESTER LOAN ORIGINATIONS 

l In 1997, FNB had $378 million in deposits in the MSA, and ranked 8th in terms of 

deposits. M & T acquired FNB in June 1999. 

l In 1996 and 1997, First National Bank originated more HMDA loans in the MSA, in 

the City, to Black/Hispanic households and low-moderate households than in 1995. 

Lending almost doubled in each of the markets identified above. 

l In 1997, 30% of the total loans in the MSA were originated to low- moderate income 

applicants. FNB had the highest % of its total MSA loans originated in the city and to 

Black/Hispanic Households. 

l In 1997, FNB had the lowest denial rates for White, Black and Hispanic applicants. 

It also had the lowest Black and Hispanic to White denial ratios of all eight banks. 

30 
- 

-_ 

- 

- 

- 

FLEET 

In 1997: 

Loans in MSA: There was a 20% decrease from 1995. 

Loans in City: There was a 53% decrease from 1995. 

Loans to Blacks/Hispanics: There was a 66% decrease from 1995 (only 4 1 loans). 

Loans to Low-Moderate Households: There was a 30% decrease from 1995. 

Loans in Low-Moderate Census Tracts: There was a 30% decrease from 1995. 

ROCHESTER LOAN ORIGINATIONS 

In 1997, Fleet had $936 million in deposits in the MSA, and ranked 5th in terms of 

deposits. Fleet’s assessment area includes the entire Rochester MSA. 

In 1996 and 1997, Fleet originated fewer HMDA loans in the City, to Black/Hispanic 

and low-moderate income households, and in low-moderate income census tracts 

compared to 1995. 

In 1997, only 3% of Fleet’s total loans in the MSA went to Black/Hispanic 

households, down from 8% in 1995. 

Fleet’s MSA marketshare was 5%. It’s marketshare in the city, amongst 

Black/Hispanic and low-mod income households, in low-mod income and minority 

census tracts was consistently lower than it’s MSA marketshare. It was the only bank 

amongst the eight compared in this report for which this was true. All the other banks 

marketshare in the city, amongst Black/Hispanic and low-mod income households, in 

31 
- 

low-mod income and minority census tracts was either equal to or greater than their 

MSA marketshare. 

l In 1997 denial rates for Black applicants continued to be as high as in 1995, with 

43% of Black applicants denied loans. In 1996 and 1997, Hispanic applicants had a 

much higher denial rare than in 1995. In 1997 Fleet had the highest denial rate for 

White applicants of all eight banks. 

- 

32 
- 

- 

- 

KEY 

In 1997: 

Loans in MSA: There was a 6% decrease from 1995. 

Loans in City: There was a 28% decrease from 1995 (only 92 loans). 

Loans to Blacks/Hispanics: There was a 38% decrease from 1995 (onJy 49 loans). 

Loans to Low-Moderate Households: There was a 13% increase from 1995. 

Loans in Low-Moderate Census Tracts: There was a 12% increase from 1995. 

ROCHESTER LOAN ORI 

l In 1997, Key had $508 million in deposits in the MSA, and ranked 6th in terms of 

deposits. 

l In 1996 and 1997, Key originated fewer HMDA loans in the City and to 

Black/Hispanic households compared to 1995. However, more loans were originated 

to low-moderate income households and in low-moderate census tracts than in 1996 

l In 1997, 36% of the total loans originated in the MSA were to low-moderate income 

households; and 27% of the total loans originated in the MSA were in low-moderate 

income census tracts. Key had the highest % of its total loans originated in the MSA 

in low-moderate households and census tracts of all banks compared in this report. 

Over 90% of Key’s loans were home improvement 

l In 1997, only 5% of Key’s total loans in the MSA went to Black/Hispanic 

households, down from 8% in 1995. 
- 

l In 1997, denial rates for Black applicants were higher than in 1995,with 45% of 

Black applicants denied loans. The Black denial rate was twice the White denial rate 

In 1996 and 1997, Hispanic applicants had a much higher denial rare than in 1995. 

The Coalition has raised some of these concerns with Key bank. We were advised that 

Key has introduced a program of credit counseling. 

34 
r - 

- 

M&T 

In 1997: 

Loans in MSA: There was less than a 1% increase from 1995. 

Loans in City: There was a 52% decrease from 1995 

Loans to Blacks/Hispanics: There was a 51% decrease from 1995 

Loans to Low-Moderate Households: There was a 36% decrease from 1995. 

Loans in Low-Moderate Census Tracts: There was a 50% decrease from 1995 

ROCHESTER LOAN ORIGINATIONS 

In 1997, M & T had $1.1 billion in deposits in the Rochester MSA, ranking it 4* in 

terms of deposits. M &T’s assessment area included the six county region of the 

MSA. 

In 1997, only 18% of M & T’s total loans in the MSA went to the City, down from 

38% in 1995. Only 11% of M & T’s total loans in the MSA went to Black/Hispanic 

households, down from 22% in 1995. However, of all 8 banks in this comparison, 

M & T originated the most loans to Black/Hispanic in households. (138) 

Although loans to low-moderate income applicants were down from 1995, a third 

of the loans were originated to low-moderate appticants. 

In 1997, denial rates for Black applicants were nearly double that in 1995, with 35% 

of Black applicants denied loans. In 1996 and 1997, Hispanic applicants had a denial 

rate that was 3-4 times higher than in 1995, with 29% of Hispanic applicants denied 

loans. 

35 
- 

- 

- 

HSBC (MARINE MIDLAND) 

BVHis HH MSA 4% 4% 6% 

LM HH MSA 51% 17% 32% 

LM CT MSA 16% 18% 13% 

Denials % 

White 

Black 

15 17 15 

36 37 30 

IHispanic 321 381 481 

First Federal 

1 1995 1 1996 

, 

MSA 863 1430 

City 135 215 

BI/His.HH 56 97 

LM HH MSA 229 384 

LM CT MSA 86 154 

/HSBC and I 

First Federal 1 

I 19951 1996 1997 

MSA 1 2,7881 3019 1.981 

City 424 399 282 

BI/His.HH 135 163 110 

LM HH MSA 1,209 648 627 

LM CT MSA 387 440 256_ 

36 
- 

- 

-- 

Following the acquisition of First Federal, Marine was unable to maintain the 

HMDA lending record of First Federal. 

In 1996, HSBC and First Federal jointly originated 3,000 HMDA loans in the MSA. 

In 1997, HSBC originated under 2,000 loans representing a 4% decrease in the 

market share of the merged bank. In 1996, First Federal originated over 1,400 loans 

in the MSA, the second highest number of the nine largest depository banks in the 

MSA. 

In 1996, HSBC and First Federal jointly originated almost 400 HMDA loans in the 

City. In 1997, HSBC originated under 300 loans, representing a 2% decrease in the 

market share of the merged bank. In 1996, First Federal originated over 200 loans in 

the City, the highest number of the nine largest depository banks in the MSA. 

In 1996, HSBC and First Federal jointly originated 163 HMDA loans to 

BlacWHispanic households in the MSA. In 1997, HSBC originated 110 loans, 

representing a 7% decrease in the market share ofthe merged bank. 

In 1996, HSBC and First Federal jointly originated 648 HMDA loans to lowmoderate income households in the MSA. In 1997, HSBC originated 627 loans, 

representing a 5% decrease in the market share of the merged bank. 

In 1996, HSBC and First Federal jointly originated 440 HMDA loans in lowmoderate income census tracts in the MSA. In 1997, HSBC originated 256 loans, 

representing a 5% decrease in the market share of the merged bank. 

In 1997, HSBC had $2.5 billion in deposits in the MSA, and ranked 1st in terms of 

deposits. HSBC’s assessment area includes the entire Rochester MSA. 

l In 1996, HSBC and First Federal jointly originated 116 non-occupants HMDA 

loans in the MSA. In 1997, HSBC originated 81 loans, representing a 4% decrease in 

the market share of the merged bank. In 1997, 940 HMDA loans were originated by 

all financial institutions up by 43 loans in comparison to 1996. 

l In 1996 and 1997, denial rates for Black applicants continued to be 30%, twice the 

White denial rate. 

l In 1997, the denial rate for Hispanic applicants jumped to 48%, almost three times the 

White denial rate. Of all banks compared in this report, HSBC had the worst denial 

rate for Hispanic applicants. 

37 
- 

- 

- 

Part II 

SMALL BUSINESS LOANS 

This part of the report is sub-divided into two sections. The first section looks at the 

aggregate small business lending data, that is the total number of small business loans 

originated by all financial institutions in Monroe County. 

The report looks at the individual lending pattern of these banks. Small business loans are 

defined as loans to businesses where the loan amount is under $1 million. They include 

small business credit cards, lines of credit and term loans. Only loans originated by the 

banks are included in this analysis. Loans purchased by the banks are not included in the 

analysis. 

The second part of the report compares the small business lending of the seven banks 

with the largest amount of local deposits in Monroe County. These banks are Chase 

Manhattan, Citibank, First National Bank, Fleet, Key Bank, M&T and Marine 

Midland Bank (HSBC). j9 

Data for small business loans is presented on countywide figures, rather than City and 

MSA. Data is not reported at the census tracts or at the city level for individual banks, 

Data is not available by race or gender. Only the number of loans originated is reported. 

The total number of applications, the number of loans denied or withdrawn is not 

available, because the law prohibits the collection of data for small business loans by race 

and gender. 

The Coalition asked all the banks included in this analysis to share their small business 

numbers for the City with the Coalition. All the banks provided us with the data, but on 

the condition that the data not be made public and only shared amongst Coalition 

members. We have honored that request. We have met with each bank to discuss their 

lending record in the City and made recommendations. 

I9 Charter One did not make Small business loans prior to 1998. 

38 
A. TOTAL NUMBER OF SMALL BUSINESS LOANS 

- 

- 

- 

- 

- 

- 

- 

MONROE COUNTY 

The total number and dollar amount of loans originated in Monroe County increased in 

1997. 

In 1997, in Monroe County: 

l The total number of small business loans increased by 9%. 

l The dollar volume of lending increased by 7% ($53 million). 

Small Business loans in Monroe County 

LOANS IN LOW-MODERATE INCOME CENSUS TRACTS: 

The number of small business loans originated in low-moderate income census tracts 

decreased in 1997, however the dollar volume increased. This implies that fewer loans of 

larger amounts were being originated, probably to larger businesses, since larger loans 

tend to be originated to larger businesses 

- 

l The total number of small business loans in low-moderate income census tracts, 

decreased by 13%. The dollar volume of lending increased by $5 million. 

l 16% of the loans and 24% of the dollar amount were originated in low-moderate 

income census tracts. 

- 

22% of businesses in the Rochester MSA are in low-moderate census tracts. 16% of the 

total number of loans were originated in low-moderate census tracts by all lenders. 

The top 7 lenders originated 21% of the loans in low-moderate census tracts. Citibank, 

FNB and HSBC originated less than 21 % of their loans in low-moderate census tracts. 

Chase, Fleet, Key and M & T originated more than 21 % of their loans in lowmoderate census tracts. 

39 
24% of the dollar volume of loans was originated in low-moderate census tracts by all 

financial institutions, as well as by the top seven lenders. FNB and HSBC originated less 

than 24 % of the dollar volume of loans in low-moderate census tracts. Citibank, Chase, 

Fleet, Key and M & T originated 24% or more of their dollar volume of loans in lowmoderate census tracts. 

LOANS TO BUSINESSES WITH GROSS ANNUAL REVENUES < $1 MILLION. 

- 

The Coalition’s report on 1996 small business lending raised the issue of the relatively 

low percentage of loan dollar volume originated to businesses with Gross Annual 

Revenues (GAR) < $1 million. Therefore, it is heartening to see that lending to business 

with GAR< $1 million improved in 1997. In 1997, a total of 3,172 loans totaling $174 

million were originated to businesses with GAR < % 1 M in Monroe County. The vast 

majority of small businesses in Monroe County have fewer than 9 employees and GAR < 

$ 1 million. 2o 

l The number of loans to businesses with GAR< $1 million, increased by 12%. The 

dollar amount increased by 40%. 

l The number loans to business with GAR < $1 million in low-moderate census tracts 

increased by 8%, to 550. The dollar volume of loans to Businesses with GAR < $1 

M in low-moderate census tracts increased by 40% to 535 million. 

l 40% of the loans, but only 23% of the dollar volume was originated to businesses 

with GAR <$l M. 

In 1997, of all banks compared in this report, FNB had the highest percentage of its 

total loans (54%) and dollar volume (47%) originated to businesses with GAR <$ 1 

million, HSBC had the lowest percentage of its total loans (36%) originated to 

businesses with GAR <$l million. Chase had the lowest percentage of loan dollar 

volume originated to businesses with GAR <!§l million (12%). 

We will continue to explore this issue further with the banks. 

HOW DID ROCHESTER COMPARE WITH OTHER CITIES IN LOANS TO 

BUSINESSES WITH GAR < % 1 M? 

- 

-- 

The Rochester MSA continues to lag behind the rest of the country in the percentage of 

dollar amount of loans to businesses with GAR ~$1 million. Nationally, in 1997, 80% of 

the total number of loans were originated to businesses with GAR < $ 1 million. In 

Monroe County, only 40% of loans were originated to businesses with GAR < $1 M. 

2o 76% of small businesses have GAR < $ 1 Million. 69% of small businesses have GAR < $0.5 

Million.70% have fewer than 4 employees.82% have fewer than 9 employees. 

40 
Nationally, in 1997, 40% of the total loan dollar volume was originated to businesses 

with GAR < $1 million. In Monroe County, only 23% of the total dollar volume of small 

business loans were originated to businesses with GAR < $1 million. 

Table 4 and 4A includes a list of randomly selected mid-size cites throughout the 

country, broken out by region. 

In the Northeast region there were only 3 MSA’s, out of a total of 16, where the dollar 

volume of small business loans originated to businesses with GAR <$I million exceeded 

40%. In 13 MSA’s, out of a total of 16, the dollar volume of small business loans 

originated to businesses with GAR <$I million was less than 40%. The three cities of 

Western New York (Buffalo, Syracuse and Rochester) comprised three out of five of 

the bottom five cities in the Northeast. They also came out in the bottom five in a an 

amalgamated list of the over 50 cities broken out by region. 

In the Midwest, for 12 out of 19 MSA’s, the total dollar volume of small business loans 

originated to businesses with GAR <$l million exceeded 40%. 

In the South, for 12 out of 16 MSA’s, the total dollar volume of small business loans 

originated to businesses with GAR <!§I million exceeded 40%. 

In the West, for 4 out of 14 MSA’s, the total dollar volume of small business loans 

originated to businesses with GAR <$l million exceeded 40%. 

41 
- 

Northeast/South 

Loans to Businesses with Revenues <$l Million Northeast 

I I ‘ I I 

, 

MSA 

Loans to Businesses with Revenues <$l Million South 

I I I 

Total Loans Loans to Bus. Rev. 

I 

Percentage to Bus. 

<SlMillion Rev. GiMillion 

Number /Amount Number IAmount Number IAmount 

IMillions IMillions /Millions 

t 9 5241 

I----------- , 

A $4191 7.1921 %274 1 76%l 65%1 

ii061 

_-. 

$741 67%1 .-‘- 63%1 

3981 3,391I $233) 700, 

I -,- . 

I 

I 

1.4271 -‘9&l 

I 

$881 -iii ?i4% -* ‘“I 

I _(_-. 

NI is.4771 $9081 8.8141 ‘- -- 

1Ft. Lauderdale FL 1 ld 

6431 612641 

-‘-. _ ILouisville KY I 

I 

10.3921 $7271 4.4071 ‘--- $275 i 

tFt. Worth TX 

I _,__- 

I 12.1121 $6901 

5:736, _-. -, ._ ‘“, 

1 $236 1 47%l 34%1 

Table 4 
MidwestlWest 

-. 

- 

- 

- 

St. Louis MO 

Dayton OH 

Indianapolis IN 

20,791 $1,650 9,980 $711 48% 43% 

7,207 $607 3,757 $230 52% 38% 

13,734 $1,121 6,059 $424 44% 38% 

Milwakee WI 16,287 $1,465 8,191 $532 50% 

Kansas City MO 12,704 $763 5,226 $275 41% 

Omaha NE 6,731 $492 2,719 $164 40% 

Jackson WY 7,916 $492 3,256 $155 41% 

Minneapolis-St.Paul MN 22,628 $1,673 8,642 $436 38% 

Loans to Businesses with Revenues *SlMillion West 

I I I 

Total Loans Loans to Bus. Rev. Percentage to Bus. 

I <$l Million Rev. 4lMillion 

Number iAmount Number IAmount Number iAmount 

Table 4A 
SMALL BUSINESS LOANS <%lOO,OOO: 

- 

Small business loans for amounts of less than $100,000 are another indicator of loans to 

smaller businesses. 

a. Number of originations. 

In 1997, 79% of the number of all reported small business loans originated in Monroe 

County were 4 100,000. 

Chase had the highest percentage of originations for loans < $100,000 (82%). M & T 

had the lowest percentage of the total number of originations for loans < $100,000 

(61%). With the exception of Chase, all the banks examined in this report had less than 

79% of their originated loans < $100,000. 

b. Amount of originations. 

- 

Only 21% of the total loan dollar volume of loans originated by all financial institutions 

were for amounts < $100,000. 

- 

Citibank had the highest percentage of dollar volume for loans < $100,000 (32%). M & 

T, along with Key, had the lowest percentage of the dollar volume of origination’s for 

loans < $100,000 (15%). 

The seven larger banks originated 63% of the loans and 85% of the dollar volume of 

small business loans 4100,000 in the MSA. American Express, Advanta, Canandaigua 

National Bank, National Bank of Geneva, Mountain West Financial Corp., MBNA, and 

Wells Fargo originated over 2,200 small business loans 4 100,000 totaling $20 million. 

This accounted for 85% of the Small business loans, <$lOO,OOO not originated by the 

seven largest lenders. Of the lenders listed above, American Express and Mountain West 

Financial were the top two lenders, in terms of number of loans. 

44 
- 

SMALL BUSINESS LOANS IN THE CITY OF ROCHESTER 

In 1997, there were 219 fewer small business loans in the City than in 1996. The dollar 

amount also decreased by $3 million. However, the number of loans originated to 

businesses with GAR <$ lmillion increased by 59 and the dollar amount increased by 

$16 million to $56 million. 

As indicated, small business loan data is not available at a census tract level for the 

individual bank. However, we were able to map those City census tracts, which received 

no small business loans at all. The census tracts marked in red received no small business 

loans. Map 1 shows that: 

l HSBC and M&T had the fewest number of census tracts with no small business loans 

at all. 

l Citibank, FNB, Fleet, Key and Chase did not have any small business loans at all in 

most of the census tracts in the southwest quadrant (Sector 4). 

l FNB and Key did not have any small business loans in a number of census tracts in 

the northeast quadrant of the City. (Sectors 9-10) 

l FNB, Fleet and Key did not have any small business loans in a number of census 

tracts off Lake Ave. in the northwest quadrant of the City. 

- 

We have met with the banks and urged them to improve their outreach and marketing 

efforts in those neighborhoods where no loans were originated. 

RECOMMENDATIONS 

The Coalition recognizes that improving lending to smaller businesses is a challenging 

task. Area banks have managed to make dramatic improvements in affordable home 

mortgage lending by having staff dedicated to that specific area of lending. They have 

accompanied this by tinding pre-and post purchase counseling both in-house and by 

contracting with local not-for-profits. A similar strategy is a key to success in order to 

improve access to capital for smaller businesses. Many small businesses need ongoing 

technical assistance in the first few years of their existence. Banks should have loan 

officers on staff whose only job is to make loans and provide technical assistance to 

businesses with GAR <% lM, businesses in low-mod census tracts and businesses in 

the City. The Coalition is confident that such a strategy will prove successtil. 

Preliminary data from some area banks who are moving in this direction confirms this 

45 
- 

-- 

PART II 

B. COMPARISION OF SEVEN MAJOR BANKS 

The seven largest banks included in this analysis originated 69% of the total number of 

loans and 92% of the dollar amount of small business loans in Monroe County, Table 5 

provides a breakdown of the number and dollar amount of small business loans of the 

seven largest banks along with their marketshare. In 1997, of the seven largest banks, in 

1997: 

HSBC was the largest small business lender in Monroe County in terms of the total 

number and amount of loans (1,166 /$192M), number of loans in low-moderate 

income census tracts (334), number and amount of loans to businesses with GAR <$ 

1M (68 1/$42M) and number of loans to businesses with GAR < $1 M in low - 

moderate income census tracts. 

M & T tied with HSBC in terms of the amount of small business loans in lowmoderate income census tracts ($48M) and amount of loans to businesses with GAR 

< $1 M in low -moderate-income census tracts ($8M). 

Key had the fewest number of small business loans in Monroe County in terms of the 

total number of loans, number of loans in low-moderate income census tracts and to 

businesses with GAR <$ 1M. 

FNB had the lowest amount of small business loans in Monroe County ($32M), the 

lowest number and amount of loans in low-moderate income census tracts, and the 

lowest number of loans to businesses with GAR < $1 M in low - moderate income 

census tracts. 

Chase had the lowest amount of loans to businesses with GAR <!§ 1M ($1 1M) and to 

businesses with GAR < $1 M in low - moderate income census tracts ($2M). 

- 

- 

- 

- 

- 

47 
2 I f I , 

1997 Rochester, Monroe County 

Small Business Loans 

I 

AFI Chase Citibank First National Fleet 

Total No. 

Key Marine M&T Top 7 OFI 

Total Amt. 7914 (Millions) 877 634 $763 $90 291 

$62 458 174 

$32 

1872 1166 6472 2,442 

LMCT 

$703 $60 

LMCT Amt (Millions) $184 $23 

------_ 53 127 $15 

$7 $21 

262 1149 

BusGAR <$l Million No. 

2 

$48 173 

fi- 3172 407 310 157 210 --- 

$17 

499 2,352 820 

Bus.GAR <$I M. 

LMCT No. 

$33 

Bus.GAR <$l M. LMCT Amt. 550 72 50 

$35 $2 

23 

$4 

44 24 

$3 

121 

$3 $4 

106 440 

$6 

110 

-----_---__~_ 

$8 32 J!? 

MARKET SHARE 

Total No, 

FirstNational 

Total Amt. (Millions) 

ll%------------ 8% 

12% 

4% 

8% 

6% 

4% 10% 

LMCT No. 

4% 28% 25% 92% 

16% 

8% 

LMCT Amt. (Millions) 

-_-__ 

13% 

lo%---------- 4% 10% 4% 27% 

8% 4%---------- 11% 

21% 

BUs.GAR <$l Million No. 

6% 

93% 

26% 

7% 

26% 94% 

13% 

6% 

BUSGAR <$l Million Amt. 

10% 

6% 

5% 7% 3% 21% 16% 74% 26% 

Bus.GAR <$I M. LMCP---- 

19% 87% 13% 

Bus.GAR <$i M. LMCT Amt. 

13% 

6% 

-------- 9% 4% 

11% 

8% 4% 

1% 

22% 

9% 

19% 

11% 

80% 

AFI: All Financial Institutions 

23% 23% 

20% 

84% 16% 

OFI: Other Financial Institutions 

Greater Rochesmtment Coalition lggg 

I I I 

Table 5 
CHASE 

In 1997: 

l Loans in Monroe County: There was a 25% increase in the number of loans. The 

dollar volume of lending increased by 17%. 

l Loans in Low-Moderate Census Tracts: There was no change in the number of loans. 

The dollar volume increased by 33%. 

l Loans to Businesses with GAR < % 1 M: There was a 75% increase in the number of 

loans, while, the dollar amount decreased by 8%. 

l Loans to Businesses with GAR C $ 1 M in Low -Moderate Census Tracts: There was 

a 50% increase in the number of loans, while, the dollar amount remained 

unchanged. 

In 1997: 

Chase had $1.1 billion in deposits in Monroe County, and ranked 3& in terms of 

deposits. Chase was also the third largest small business lender in Monroe County in 

number and amount of loans. 

22% of the number of loans and 26% of the dollar volume of loans was originated in 

low-moderate census tracts, 

46% of the number of loans, but only 12% of the dollar amount, was originated to 

businesses with GAR <$l M. Chase ranked third in the number of loans originated to 

such businesses. 

The amount of loans to Businesses with GAR ~$1 M in low-moderate census tracts 

was a mere $2 million, the lowest amount of all seven banks compared in this report 

However, Chase had the third highest number of loans to such businesses. 

82% of small business loans were for amounts < $100,000, the highest of the banks 

compared in this report. 

Chase has advised the Coalition that the smaller dollar amount of their loans is a 

reflection of their philosophy to meet the needs of smaller businesses. 

49 
CITIBANK 

In 1997: 

l Loans in Monroe County: There was a 50% increase in the number and amount of 

loans. 

l Loans in Low-Moderate Census Tracts: There was a 38% increase in the number of 

loans. The dollar volume of lending increased by 66%. ($15M) 

l Loans to Businesses with GAR < % 1 M: There was a 50% increase in the number of 

loans. The dollar amount increased by 90%. 

l Loans to Businesses with GAR < $ 1 M in Low-Moderate Census Tracts: There was a 

7% increase in the number of loans and a 50% increase in the amount of loans. 

(NM) 

PERCENT OF LOANS TO 

Low Mod CT BUSGAR ~$1 M. BUSGAR <$I 

M.LMCT 

Loans Amt.M. Loans Amt.M. Loans Amt.M. 

1996 22% 23% 49% 30% 17% 17% 

1997 20% 24% 49% 34% 16% 19% 

In 1997: 

Citibank had $481 million in deposits in Monroe County, and ranked 5th in terms of 

deposits. It ranked 4* in terms of the total number of small business loans originated in 

Monroe County. 

l 49% of the number of loans and 34% of the dollar volume was originated to 

businesses with GAR ~$1 M. 

l 20% of the number of loans and 24% of the dollar volume of loans was originated in 

low-moderate census tracts. 

l 77% of small business loans were for amounts < $I 00,000 which was better than the 

average of the seven largest banks (72%) 

50 
CITIBANK 

In 1997: 

l Loans in Monroe County: There was a 50% increase in the number and amount of 

loans. 

l Loans in Low-Moderate Census Tracts: There was a 38% increase in the number of 

loans. The dollar volume of lending increased by 66%. ($15M) 

l Loans to Businesses with GAR < % 1 M: There was a 50% increase in the number of 

loans. The dollar amount increased by 90%. 

l Loans to Businesses with GAR < 3 1 M in Low-Moderate Census Tracts: There was a 

7% increase in the number of loans and a 50% increase in the amount of loans. 

WM) 

C 

PERCENT OF LOANS TO 

Low Mod CT BUS.GAR ~$1 M. BUSGAR ~$1 

M.LMCT 

Loans Amt.M. Loans Amt.M. Loans Amt.M. 

1996 22% 23% 49% 30% 17% 

19971 

77% 

20% 24% 49% 34% 16% 19% 

In 1997: 

Citibank had $481 million in deposits in Monroe County, and ranked 5th in terms of 

deposits. It ranked 4* in terms of the total number of small business loans originated in 

Monroe County. 

l 49% of the number of loans and 34% of the dollar volume was originated to 

businesses with GAR <$l M. 

l 20% of the number of loans and 24% of the dollar volume of loans was originated in 

low-moderate census tracts. 

l 77% of small business loans were for amounts < $100,000 which was better than the 

average of the seven largest banks (72%) 
FIRST NATIONAL BANK 

In 1997: 

l Loans in Monroe County: There was a 20% increase in the number of loans. The 

dollar volume of lending increased by 10%. 

l Loans in Low-Moderate Census Tracts: There was a 23% increase in the number of 

loans. The dollar volume more than doubled (%7M). 

l Loans to Businesses with GAR < % 1 M: There was a 44% increase in the number of 

loans. The dollar amount more than doubled to %15M. 

l Loans to Businesses with GAR < % 1 M in Low-Moderate Census Tracts: The 

number of loans doubled and the dollar amount increased six-fold to $3 M. 

PERCENT OF LOANS TO 

Low Moderate BUSGAR ~$1 M. BUS.GAR ~$1 

CT M.LMCT 

Loans Amt.M. Loans Amt.M. Loans Amt.M. 

1996 10% 10% 45% 24% 11% 7% 

1997 18% 22% 54% 47% 15% 20% 

In 1997: 

FNB had $378 million in deposits in Monroe County, and ranked 6th in terms of 

deposits. 

54% of the number of loans and 47% of the dollar volume was originated to 

businesses with GAR <$l M. Of all banks compared in this report, FNB had the 

highest percentage of its total loans originated to businesses with GAR ~$1 

million. 

18% of the number of loans and 22% of the dollar volume of loans was originated in 

low-moderate census tracts. 

73% of the loans FNES originated were under $100,000. 28% of the dollar amount 

originated was for loans under < $100,000. 

FNB originated the smallest dollar volume of small business loans in Monroe 

County 

51 
- 

_ 

FLEET 

- 

- 

- 

- 

- 

In 1997: 

l Loans in Monroe County: There was a 24% and 29% decrease in the number and 

amount of loans, respectively. 

l Loans in Low-Moderate Census Tracts: There was a 23% decrease in the number of 

loans. The dollar volume of lending decreased by 32%. 

l Loans to Businesses with GAR < $ 1 M: There was a 25% decrease in the number of 

loans. The dollar amount decreased by 36%. 

l Loans to Businesses with GAR < $ 1 M in Low-Moderate Census Tracts: There was 

a 60% decrease in the amount of loans. 

PERCENT OF LOANS TO 

ILow Moderate (BUS.GAR ~$1 M. l13us.G~~ ~$1 

Fleet had $541 million in deposits in Monroe County, and ranked 4th in terms of 

deposits. Fleet was the 5* small business lender in Monroe County (number of loans). 

having fallen behind from 4* place in 1996. 

In 1997: 

- 

- 

- 

l 22% of the total dollar volume of loans were originated to businesses with GAR ~$1 

M. 

l 28% of the number and dollar volume of loans were originated in low-moderate 

census tracts, which was higher than the average for all financial institutions 

l 64% of small business loans were for amounts < $100,000, which was lower than the 

average for all financial institutions 

- 

52 
KEY 

0 In 1997 KEY maintained its level of small business lending in Monroe County, lowmoderate income census tracts and to businesses with GM< $1 million. 

volume of lending to businesses with GAR <$I M increased by 50%. 

The dollar 

l The dollar volume of loans to businesses with GAR <$I M in low-moderate census 

tracts increased by 25%. 

PERCENT OF LOANS TO 

/Low Moderate IBUS.GAR ~$1 nk JE~uS.GAR ~$1 

Key had $204 million in deposits in Monroe County, and ranked 8th in terms of deposits 

Of the seven banks, Key had the fewest number of small business loans in Monroe 

County. 

l 30% of the number of loans was originated in low-moderate census tracts, which was 

higher than the average for all financial institutions. 

l 35% of the total dollar volume were originated to businesses with GAR <$I M 

l 68% of small business loans were for amounts < $100,000, which was lower than the 

average for all financial institutions 

53 
M&T 

- 

In 1997: 

l Loans in Monroe County: There was a 45% increase in the number of loans. The 

dollar amount of loans increased by 30%.. 

l Loans in Low-Moderate census tracts: There was a 27% increase in the number of 

loans, The dollar volume of lending increased by 8%. 

l Loans to Businesses with GAR < $ 1 M: There was a 70% increase in the number of 

loans. The dollar amount increased by 22%. 

l Loans to Businesses with GAR < $ 1 M in Low-Moderate Census Tracts: There was 

a 60% increase in the number of loans and a 14% increase in the dollar volume 

of loans. 

Year TOTAL Low Moderate BUS.GAR 41 M. BUS.GAR <$I 

CT M.LMCT 

Loans Amt.M Loans Amt.M. Loans Amt.M. Loans Amt.M. 

1996 801 $147 207 $44 293 $27 66 $7 

1997 1,166 $192 262 $48 499 $33 106 $8 

- 

- 

- 

-. In 1997, M&T was the second largest small business lender in Monroe County, both in 

terms of number and dollar volume of loans. M & T, along with Marine, had the highest 

dollar volume of loans in low-moderate census tracts. M & T had the second largest 

number and dollar volume of loans to businesses with GAR < $lM. 

22% of the loans were originated in low-moderate census tracts, which was lower 

than the average for all financial institutions. 

17% of the total dollar volume was originated to businesses with GAR 31 M, which 

was lower than the average for all financial institutions. 

61% of the loans M & T originated were under $100,000. This was the lowest 

percentage of all seven banks, Only 15% of the dollar amount originated were for 

loans under < $100,000, which was lower than the aggregate percentage for all 

financial institutions (21%). 

54 
MARINE MIDLAND/HSBC 

In 1997: 

l Loans in Monroe County: There was a 18% decrease in the number of loans. The 

dollar amount of loans remained comparable to 1996. 

l Loans in Low-Moderate Census Tracts: The number and dollar volume of loans was 

comparable to 1996. 

l Loans to businesses with GAR C $ 1 M: There was a 16% increase in the number of 

loans. The dollar volume increased by 147% to 342.M. 

l Loans to Businesses with GAR < $ 1 M in Low-Moderate Census Tracts: There was 

a 100% increase in the dollar volume of loans. 

HSBC was the largest small business lender in Monroe County, both in terms of number 

and dollar volume of loans. Marine, along with M & T, had the highest dollar volume of 

loans in low-moderate census tracts. HSBC had the largest number and volume of loans 

to businesses with GAR < $lM. 

l 18% of the loans were originated in low-moderate census tracts, which was lower 

than the average for all financial institutions. 

l 19% of the total dollar volume was originated to businesses with GAR <$I M, which 

was lower than the average for all financial institutions. 

l 74% of the loans HSBC originated were under $100,000. Only 16% of the dollar 

volume originated was for loans under < $100,000, which was lower than the 

aggregate percentage for all financial institutions 

55 
GLOSSARY 

Community Reinvestment Act of 1977 (CM) 

CRA is the federal law which defines lending obligations of federally regulated or 

insured banks, savings and loan companies and requires these institutions to serve the 

needs of the entire community in their assessment area. These financial institutions 

have an affirmative obligation to include services and lending that meet the needs of 

low-moderate neighborhoods. In 1995 new regulations strengthened CRA by 

requiring more emphasis on a financial institution’s performance evaluations. 

Conventional 

This refers to any loan other than those insured or guaranteed by the federal 

government. Private mortgage insurance is required for conventional loan borrowers 

who have loan-to-value ratios over 80 percent. 

Credit Union 

A nonprofit, member owned financial institution. Credit unions serve a defined 

“field of membership” including a particular community, group of employees, or 

members of a group or association. A person or their family member must belong 

to one the groups in the field of membership in order to join a credit union. 

Similar to banks, credit unions are federally insured depository institutions 

charted by a state or federal regulatory agency. 

Depository Institution 

These types of financial institutions maintain deposits for account holders that are 

federally insured. Federal funds created by congress, the Federal Insurance 

Deposit Corporation (FDIC) and the National Credit Union Share Insurance Fund 

(NCUSIF), insure accounts up to $100,000. 

Fannie Mae 

Fannie Mae is a private, stock-owner corporation chartered by Congress to 

provide a secondary market for mortgages by purchasing mortgages originated b> 

other financial institutions. 

Federal Housing Administration (FHA) 

FHA, a division of the federal Dept. of Housing and Urban Development, insures 

mortgage loans up to a maximum allowable amount for borrowers meeting 

specific income and debt-to-loan ratios for properties meeting FHA standards. 

Gross Annual Revenue (GAR) 

Revenues earned by a business before expenses are deducted. The GAR figure is 

relevant in analyzing community development business loans because loans to 

businesses with less than I million GAR are considered loans to small businesses 

when they are reported to regulatory agencies by financial institutions. 

56 
- 

-. 

-- 

Home Mortgage Disclosure Act of 1975 (HMDA) 

I-MDA requires each bank and, ifapplicable, its home mortgage lending subsidiary, 

to collect and report lending data to regulators and disclose certain data to the public. 

The scope of HMDA was expanded in 1990 and information now available to the 

public includes; the type of loan, location and type of property, the race, gender and 

income of the applicant. Financial institutions must also report on the status ofthe 

application, whether it was approvd, denied, withdrawn, closed for incompleteness or 

sold on the secondary market. HMDA data is used to help the public determine if a 

financial institution is meeting the investment needs of their community. 

Metropolitan Statistical Area @iSA) 

Census data is reported at the individual household level as well as for geographic 

regions. The MSA refers to a defined urbanized area with one large population 

nucleus, together with adjacent communities that have a high degree of economic 

and social integration. The Rochester MSA includes the City of Rochester and 

the surrounding communities in Monroe, Wayne, Ontario, Livingston, Orleans 

and Genesee counties. 

- 

Low-moderate income household 

The U.S. Department of Housing and Urban Development classifies households 

based on a formula tied to median family income for particular communities. 

Low -moderate income households are those with annual income of 80 percent or 

less of the area family median income. Low-income households earn 50 percent 

or less of area family median income. 

Low-moderate income census tract 

Census tracts are classified as low-moderate income based on the percentage of lowmoderate income households in comparison to the total number of households. 

HMDA data classifies census tracts as low-mod if they have a low-moderate income 

population in excess of 50 percent. 

Mortgage bank 

A non-depository financial institution whose primary purpose is to provide mortgage 

loans, refinancing and home equity lines of credit to homeowners. 

Minority census tract 

A census tract with a minority population in excess of 50 percent. 

Sub-prime lender 

Financial institutions whose interest rate for lending is higher than the prime 

market rate for similar loans made by other financial institutions, Sub-prime 

lenders specialize in lending to borrowers who do not meet the loan underwriting 

criteria of retail banks and generally incur higher costs for using more flexible 

underwriting standards and assuming greater risk. 

57 
GREATER ROCHESTER 

COWbWNITY REINVESTiL1ENT COALITION 

P.O. BOX 39541 

ROCHESTER, NEW YORK 14604 

July 6’h 1999 

Jonathan Fine 

Federal Reserve Bank of Boston 

PO Box 2076 

Boston, MA 02 106 

Re: Fleet/BankBoston merger 

Dear Mr. Fine, 

I am writing to you on behalf of the Greater Rochester Community Reinvestment 

Coalition (GRCRC) to submit comments on the Fleet/Bar&Boston merger. 

GRCRC was convened in 1993 to generate discussion about the lending patterns in 

Rochester. Since then, the Coalition has released four analyses of home mortgage and 

small business lending data. We have used the analyses to identify strengths and 

weaknesses in lending patterns and to generate ongoing discussion with the banks in 

question. The Coalition also submits comments, based on the data, to the appropriate 

Federal regulators who have oversight of the banks. 

GRCRC has a membership of over 30 locally based not-for profits and individuals. 

GRCRC has ongoing written commitments from M&T Bank, HSBC (Marine Midland) 

and Charter One about their community reinvestment obligations. GRCRC also 

continues to monitor unilateral pledges made by Chase and Citibank. 

FLEET’S HMDA LOANS 

Fleet’s HMDA lending has declined dramatically in the last three years. GRCRC has 

released a report on HMDA and small business lending. I have included some excerpts 

from the report where it pertain to Fleet. I have also included a brief analysis of the 

aggregate lending pattern in Rochester to place Fleet’s lending in context. A market share 

chart of the 8 largest banks, for the Rochester MSA, is attached. 

In 1997, Fleet had $936 million in deposits in the Rochester MSA and ranked 5th in 

terms of deposits. Fleet’s assessment area includes the entire Rochester MSA. 
In 1997: 

Loans in MSA: There was a 20% decrease from 1995. 

Loans in City: There was a 53% decrease from 1995. 

Loans to Blacks/Hispanics: There was a 66% decrease from 1995 (only 41 loans). 

Loans to Low-Moderate Households: There was a 30% decrease from 1995. 

Loans in Low-Moderate Census Tracts: There was a 30% decrease from 1995. 

This information is presented in Table format below. 

195-97 195-97 I 

1995 

MSA market share 7.4% 

MSA 1.482 

1996 

5.5% 

1.380 

1997 Difference Decrease 

4.6% -2.8% 

1.179 -303 -20% 

City ‘266 ‘167 ‘126 -140 -53% 

BVHis HH MSA 122 71 41 -81 -66% 

LM HH MSA 446 317 310 -136 -30% 

LM CT MSA 220 216 154 -66 -30% 

Non-occupant 47 46 33 -14 -30% 

I%f loans in: I I I I I 

city 1 18%1 12%1 II%1 

BVHis HH 1 /ISA 1 8%1 5%1 3%\ 

LM HH MSA 30%1 23%1 26%1 1 

LM CT MSA 15%1 16%1 13%1 1 

In 1997, 

l In 1996 and 1997, Fleet originated fewer HMDA loans in the City, to Black/Hispanic 

and low-moderate income households, and in low-moderate income census tracts 

compared to 1995. 

l In 1997, only 3% of Fleet’s total loans in the MSA went to Black/Hispanic 

households, down from 8% in 1995. 

In 1997 denial rates for Black applicants continued to be as high as in 1995, with 43% 

of Black applicants denied loans. Hispanic applicants were had a 30% denial rate. In 

1997 Fleet had the highest denial rate for White applicants of all eight banks (28%) 

A chart comparing the 1997 HMDA denials of the eight largest banks is attached and 

should be incorporated into these comments. 

2 
FLEETS HMDA LENDING COMPARED TO AREA PEERS 

Obviously the changes in Fleet HMDA lending need to be placed in context of market 

changes. 

Since 1992, there has been a significant improvement in HMDA lending for city 

residents, Black, Hispanic and low-to moderate-income households. 

Lending by all I-I&IDA lenders in 1997, compared to 1992: 

l Increased in the MSA by 9%. 

l Increased in the City by 94%. 

l Increased to Black/Hispanic households by 123%. 

l Increased to low-moderate income households by 72%. 

l Increased in low-moderate income census tracts by 41%. 

l Increased in minority census tracts by 139%. 

It is important understand what role the eight largest area banks ’ played in these 

increases. Between 1992 and 1997, the eight largest banks with branch presence in the 

MSA (including their acquired institutions) saw: 

l a 46% decrease in their HMDA lending in the MSA; 

l a 33% decrease in their HMDA lending in the City; 

l a 38% increase in their lending to Black/Hispanic households; 

l a 5 % decrease in their lending in minority census tracts; and 

l a 19% decrease in their lending in low-moderate income census tracts. 

Overall, the number of HMDA loans has increased since 1992. However, the top 8 area 

banks made almost 7,000 fewer HMDA loans in 1997 than in 1992. The increase in 

lending was accounted for by the other financial institutions serving the marketplace. The 

slack caused by the decline in bank lending was made up by credit unions, mortgage 

banks, out-of-state banks and sub-prime lenders. 

Despite the fact that the top 8 institutions saw a decline in their HMDA lending since 

1992, a greater proportion of their lending in 1997 was in the City, to Black and Hispanic 

households, and in low moderate and minority census tracts. 

’ Charter One, Chase, Citibank, First National Bank of Rochester, Fleet, Key, ML% T, HSBC (Marine 

Midland) 

3 
In 1997, of the total loans originated by the eight largest area banks in the Rochester 

MSA: 

l 15% were in the City, up from 12% in 1992. 

l 7% were to Black/Hispanic households, up from 3% in 1992. 

l 15% were in low-moderate income census tracts, up from 5% in 1992. 

0 4% were in minority census tracts, up from 2% in 1992. 

When we compare Fleet’s HMDA lending with its local bank peers it is apparent that 

Fleet only had: 

11% of it’s Rochester MSA loans in the city compared to the 15% of the top 8 area 

bank average. 

3% of it’s Rochester MSA loans to Black/Hispanic households in the MSA compared 

to 7% of the top 8 area bank average. 

26% of it’s Rochester MSA loans to low moderate income households in the MSA 

compared to 30% of the top 8 area bank average. 

13% of it’s Rochester MSA loans in low moderate income census tracts in the MSA 

compared to 15% of the top 8 area bank average. 

1% of it’s Rochester MSA loans in minority census tracts in the MSA compared to 

4% of the top 8 area bank average. 

We recognize that the marketplace has changed hut a number of the other area 

banks have improved their HMDA lending to traditionally underserved 

communities. The data shows that Fleet is lagging in this regard. 
FLEET SMALL BUSINESS LOANS 

In 1997: 

l Loans in Monroe County: There was a 24% and 29% decrease in the number and 

amount of loans, respectively. 

l Loans in Low-Moderate Census Tracts: There was a 23% decrease in the number of 

loans. The dollar volume of lending decreased by 32%. 

l Loans to Businesses with GAR < $ 1 M: There was a 25% decrease in the number of 

loans. The dollar amount decreased by 36%. 

l Loans to Businesses with GAR < $ 1 M in Low-Moderate Census Tracts (LMCT): 

There was a 60% decrease in the amount of loans. 

Year TOTAL Low Mod BUS.GAR <$I M. BUS.GAR ~$1 

Census Tracts M.LMCT 

Loans Amt.M Loans Amt.M. Loans Amt.M. Loans Amt.M. 

1996 602 $ 107 164 29 280 25 62 5 

In 1997: 

l 22% of the total dollar volume of loans were originated to businesses with GAR <$l 

M. 

l 28% of the number and dollar volume of loans were originated in low-moderate 

census tracts, which was higher than the average for all financial institutions. 

l 64% of small business loans were for amounts < $100,000, which was lower than the 

average for all financial institutions 

A marketshare chart of 1997 small business lending in Monroe County by the 7 largest 

area banks is included with these comments. 

The GRCRC is committed to fostering partnerships with all financial institutions in the 

belief that the goal of meeting the credit needs of traditionally underserved communities 

is compatible with safe and sound lending practices. 

5 
GRCRC has met with Fleet twice in the last 6 months. We have asked Fleet to provide 

the Coalition in writing their plans for a meeting the community reinvestment needs in 

our community. We are concerned that Fleet is not willing to do that. 

We are not in a position to comment on the draft “pledge” that has been released to some 

community groups. We asked Fleet to share the pledge with the Coalition but were 

advised that that was not possible. We have only been privy to an unofficial version and 

from what we have seen it appears to us that the numbers are not broken down by 

assessment areas within states or even by state. 

Furthermore, since 1998 HMDA data is not yet publicly available we are unable to 

ascertain whether the “pledge” represents an increase or decrease of Fleet’s current 

lending. 

We are formally requesting that the Federal Reserve Bank of Boston condition the 

approval of this merger on Fleet providing very specific details about their HMDA, 

small business and community development lending in each of their markets. We do 

not believe that regional or even statewide commitments are adequate. The current 

mechanisms for monitoring multi year, multi-state commitments are at best 

inadequate and at worst non-existent. 

Fleet must provide greater specificity in terms of demonstrating how the pledge 

reflects an increase in their community development lending. In addition, Fleet must 

provide greater details about their proposed lending by category in each assessment 

area. In the event that Fleet fails to do so the Federal Reserve Bank should not 

approve this merger. 

We are also requesting that in the event Fleet releases a “community commitment “ 

the Federal Reserve Bank extend the comment period to two weeks after the date of 

release of such a commitment. 

If you have any questions please feel free to contact me. I can be reached at 716-454- 

4060. 

Yours truly, 

Ruhi Maker Esq. 

Mosie Hanna Fleet Bank 

6 
Top 8 Banks 

Rochester, NY 

1997 HMDA Loans / 

1 AFI 1 Charter One 1 Chase 1 Citibank 1 FNB 1 Fleet I Key 1 M&T I Marine I Top 6 1 OFI 

MSA 25,660 1,119 573 372 527 1,179 932 1,295 1,981 7,978 17,682 

City 3,779 198 77 52 124 126 92 237 282 1,188 2,591 

Black/Hispanic HH MSA 1,507 102 32 28 67 41 49 138 110 567 940 

1 n\r.r_Mnri I-II-I MSA 7 !im T?ACI lAB 78 I.57 310 331 432 627 2,424 5,159 

L”““-,.I”U Lod-Mod Income I mm I I.IV_ CT 3,673 * (VW- _ 136 . . “- 60 53 ‘84 ,54 175 ?)EC 1,171, 2,502, 

Minority CT 1,203 66 39 16 36 14 

Non-Occunant 940 16 28 4 11 33 

I I I I 

MARKETSHARE 

I _,,l,.1, w.... _..__.s , _.tibank FNB Fleet Key M&T Marine 

I AOLI 3OL I 1 % 3Q/!. 4% A% 5% OOI ? 1 OL coo/, 

v,ry 

Black/Hispanic HH MSA 

Low-Mod HH MSA 

I ow-Mod Income CT 

Jinority CT 

Non-Occupant 

IL 

IiG 

“I” _ ,Y I I” _I” - ,- -,_ I I” u I I” vu ro 

7% 2% 2% 4% 3% 3% 9; 7% 38% 62% 

4% 2% 1% 2% 4% 4% 6% 8% 32% 68% 

4% 2% 1% 2% 4% 7% 5% 7% 32% 68% 

5% 3% 1% 3% 1% 2% 5% 6% 27% 73% 

2% 3% 0% 1% 4% 1% 4% 9% 24% 76% 

Loans as % 

of MSA TOTAL IN: 

City 

Black/Hispanic HH MSA 

Low-Mod HH MSA 

Low-Mod Income CT 

Minority CT 

Non-Occupant 

AFI: All Financial lnstitions 

OFI: Other Financial lnstitions 

GRCRC 1999 

I 

Charter One Chase Citibank FNB Fleet Key M&T Marine 

15% 18% 13% 14% 24% 11% 10% 18% 14% 15% 15% 

6% 9% 6% 8% 13% 3% 5% 11% 6% 7% 5% 

30% 30% 26% 21% 30% 26% 36% 33% 32% 30% 29% 

14% 12% 10% 14% 16% 13% 27% 14% 13% 15% 14% 

5% 6% 7% 4% 7% 1% 3% 5% 3% 4% 34% 

4% 1% 5% 1% 2% 3% 2% 3% 4% 3% 4% 

‘\’ 
Top 7 Banks 

1997 Rochester, Monroe County 

Small Business Loans 

Total No. 

Tofat Amt. (Millions) 

LM,CT No. 

Bus.GAR ~$1 Million’ No., 

Bu+GAR <$I Million Am!. (M) 

Bus.GAR c$l M. LMCT No. 

@us.GAR ~$1 M. LMCT Amt. 

(Millibns) 

AFI Chase Citibank First National Fleet Key Marine M&T Top 7 OFI 

7914 877 634 291 458 174 1872 1166 5472 2,442 

$763 $90 $62 $32 $76 $34 $217 $192 $703 $60, 

1237 194 126 5; 127 

$23215 $21 sz 

334 262 1149 

_ __ $48 $48 173 $Y 

3172 407 310 157 210 $7: 681 499 2,352 820 

$174 $11 $21 $15 $17 $42 $33 151 $23, 

550 72 50 23 44 24 121 106 440 110 

$35 $2 $4 $3 $3 $4 $8 $8 32 $3 

h/lARKET SiiARS 

Chase Citibank First National Fleet Key Marine M&T Top 7 OFI 

‘j-ofal No. 11% 8% 4% 6% 2% 24% 15% 69% 31% 

Tptal Amt. (Millions)’ 12% 8% 4% 10% 4% 28% 25% 92% 8% 

LM,CT No. 16% 10% 4% 10% 4% 27% 21% 93% 7% 

l_M.CT Amt. (Millions) , , , 13% 8% 4% 11% 6% 26% 26% 94% 6% 

Bu,s.GAR ~$1 Million’ No., 13% 10% 5% 7% 3% 21% 16% 74% 26% 

Bus.GAR c$l Million Amt. 6% 12% 9% 10% 7% 24% 19% 87% 13% 

Bu,s.GA,R c$j M. LMCT No. 13% 9% 4% 8% 4% 22% 19% 80% 20% 

Bus.GAR ~$1 M. LfVjCT Amt. 6% 11% 1% 9% 11% 23% 23% 84% 16% 

AFI: At~financinl-(n~it6tidns 

OFI: Other Financial Institutions 

Greater Rochester Community Reivestment Coalition 1999 

I I I 
07/07/l 999 08: 33 3026545046 

, -____ DCRAC INC PAGE 01 

__- 

- 1 

Fax 

To: Mr. Robert Brady 

of: Fed, Res. Bank ofBoston 

Fax: 617-973-3219 

Pages: 5, including this cover sheet. 

. 

Date: July 7, 1999 

From the desk of... 

RASHMI RANGAN 

DELAWARE COMMUNITY REINVESTMENT ACTION COUNCIL, INC. (DCRAC) 

601 N. CHURCH STREET 

WILMINGTON, DE 19801 

302-654~5024/877-825-0750 

Fax: 302-654-5046 
, 0?/07/1999 08:33 3026545046 DCRAC INC PAGE 02 1 

Delaware Community 

Reinvestment Action Council, Inc. 

801 N. C?tmrchStreet, w-on, DE 19801 

TeJe@oF: 30% 65X-5024 or toll free 87?-82&0750 F&sin&: 302- @j&j@+6 

VIA Fucs~tnlle: 617-973-3219 e-mail: rashmi$bellatlantic_mt 

July 7, 199c) 

Mr. Robert M. Brady 

Vice President 

Federal Reserve Bank of Boston 

600 Atlantic Avenue 

Boston, Massachusetts 02106 

RF.: PETITTON TO DENY THE APPLitiATLONS OF FLEET FINANCIAL 

GHOl!P, INC. TO ACQUlRE BANKBOSTON CORP. AND ITS SlJBSIDIARlES 

Dear Mr. Brady: 

On behaif of the Delaware Community Reinvestment Action Council, Inc. (DCRAC), I write to 

apologize for my inability to travel to ‘Boston today to testify on the panel at I 1:45 am. My threepage comments are included with this communication. I am requesting that someone read my 

comments during the time allocated for my testimony. In the alternative, my testimony be f%lly 

entered into the record of the public hearing. 

1 thank you for your accommodation of my request. 

Sincerely, 

R-A_* 

5 Rashmi Rangan - 

Executive Director 

Our mission is “to ewe egual access to credit and capital 

for the under sed populations and communities throughout Delaware 

through Education, Advocacy, and L,egislation” 
0i/07/1999 08: 33 3026545046 DCRAC INC 

. PAGE 03 I 

Delaware Comxnunity 

Reinvestment Action Council, Inc. 

f3OlN.ChnrchStreet,Wilmiragtcm,DE 19801 

Telephcme: 302 854-5024 or toll free 877-8!XX750 F’amimile: 30% 854-5048 

wnail: rashmi@bellatlantic.mt 

TESTIMONY OF RASHMI RANCAN, 

DELAWARE COMMUNITY FWNVESTMENT ACTION COUNCIL, 

OPPOSING THE MERGER APPLICATIONS OF 

FLEET FINANCIAL AND BANKBOSTON’CORP. 

JULY 7,1999 

My name is Rashmi Rangan. I am the executive director of the Delaware Community 

Reinvestment Action Council,, or DCRAC. For over twelve years, our organization has 

advocated for fair and equal access to credit and capital for the underserved Delawareans. 

We are opposed to the merger proposal of Fleet Financial Group, (,Fleet) and HankBoston Corp. 

(BankBoston). This application should be denied. The merger proposal does not serve the 

convenience and needs of the community. Nor, does the merger proposal have a positive market 

impact. 

I. THIS MERGER’S ANTI-COMPETITIVE IMPACT CALLS FOR A DENIAL. 

The FRB cannot approve any proposal under $3 of the BHC which would substantially lessen 

competition in any hiinking market, unless the anti-competitive effects are clearly outweighed in 

the public interest by the convenience and needs of the community. I2 U.S.C.;1842(c). This 

proposed merger is anti-competitive. Public convenience and needs are not served through this 

merger. The Federal Reserve Board (FRB) should deny this application. By reference, DCRAC 

introduces the June 6. I999 commems of Inner City Press/Community on the Move (ICP) and its 

analysis ot’ the anti-competitive effects of this merger. 

II. FIXET’S TROUBLING FATR LENDING RECORD CALLS FOR DENIAL. 

Again. IXRAC submits, by reference, ICP’s analysis on this issue. 

Fleet acquired Shawmut in 1995, and NatWest in 1996. 

Fleet’s combined entities’ lending volume declined 70% between 1995 and 1997 

The decline is greater in lending to minorities and in LMI census tracts. 

Fleet’s past mergers have not only hurt entire communities, but (an adverse factor under the 

CRA). they have disproportionately harmed low and moderate income communities. 

Our mission is “to ensure equal access to credit imd capital 

for the under served populations and cmmmnities throughout Delaware 

through Education, Advocacy, and Legislation” 
PAGE 64 

!I 

07/07/1999 08:33 3026545046 DCRAC INC . 

1'dOE TWO 

111. FLEET’S PREDATORY LENDING ABUSES CALL FOR A DENlAl.. 

In May 1996, Fleet settled discrimination charges with the U.S. Department of Justice. Charges 

that it sys.tematically overcharged minorities from its two New York City-area mortgage offices. 

In 1999, Fleet continues abusive lending practices. 

By reference, I enter the Boston Globe article, “B 

m co-,” by Patricia Wen and Bruce Mohl, June, 6, 1999. The article reports that 

Fleet’s “fast-loan check” program delivered an easy-to-cash check of $10,000 to a 74-year-old 

mentally impaired man whose sole residence and mailing address in the past 18 years was a 

veterans’ hospital in Bedford, Fleet sees no shame in it. 

IV. FLEET’S POOR RECORD OF SERVlNG THE CONVENTENCE It NEEDS OF THE 

COMMUNXTY CALLS FOR A DENIAL. 

A Bank which treats its long-term customers the way Fleet treats its elderly, says much about the 

bank’s efl’orts at not meeting the convenience and needs of its community. By reference, I. enter 

the Providence Journal article of May 29, 1999, “A r’ee 

a,,” by Bob Kerr who reports that the elderly customer, slapped with fines for insufficient finds 

“was told he could get $25 back, but only ifhe purchased yearly overdraft protection, for $24. 

Then he was told he could get $37.50 back, but only if he purchased overdraft protection and 

signed up for direct deposit of his Social Security checks.” 

V. FLEET IN DELAWARE 

It has been our practice to approach Delaware’s non-profit service providing community such as 

small business lenders and counselors and home ownership counseling agencies to learn about a 

bank’s direct involvement in our community. Consistently, each agency maintained that with 

Fleet’s acquisition of NatWest in 1996, Fleet has done nothing in Defaware. They do not even 

have a CRA Officer! Vindicating charges of Fleet’s poor performance after each of its past 

acquisiiions. 

VI. FLEET’S HMDA ANALYSIS FOR DELAWARE 

In 1997, the following Fleet entities conducted mortgage lending business: Fleet Real Estate 

Funding Corporation & Fleet Home Equity USA. Between the two, they received 63 applications 

for mortgage, home improvement, and refinance loans. 

l Flee\ did not collect data by race for 40 of these applications, or 63.49%. This is a violation of 

the Home Mortgage Disclosure Act (HMDA). HMDA was enacted with the goal of 

(asssessing who is and who is not having access to the credit system. By eliminating fi~lly 64% 

of data from review, Fleet violates the intent and spirit of the law. 

l Fleet’s approval rate for whites was 65% compared with 50% for: African Americans 

l Fleet’s denial rate for Whites was 23% compared with 25% for Af+ican Americans. 

l Fleet received 18 applications from white applicants and 3 from African Americans. 

Relative to applicant incomes, 

From applicants with median incomes below 50%, Fleet received 2 applications and denied 

both, a denial rate of 100%. 

From appIicants with median incomes 50-79%, Fleet received 17 applications and denied 6, a 

denial rate of 35%. 

From applicants with median incomes 80-99%, Fleet received 10 appljcations and denied 3, a 

denial rate of 30% 

From applicants with median incomes 99-l 19%, Fleet received 1 i‘ applications and denied 4. a 

denial rate of 36%. 
07/07/1999 08: 33 3026545046 DCRAC INC PAGE 

l From applicants with median incomes >120%, Fleet received 24 applications and denied 4. a 

denial rate of 16.6%. 

Despite Fleet’s relatively small market penetration in the Wilmin@on and Dover MSA of the State 

of Delaware, Fleet’s performance raises enough red flags. Fleet’s application should be denied. 

CONCLUSION 

Fleet h’as a record of not serving the convenience and needs of its community after it acquires 

another financial institution. For example, after Fleet acquired NatWest, Fleet even took away its 

CRA officer for Delaware. Based on Fleet’s record of ignoring the convenience and needs of the 

community, this merger should be denied. 

The Federal Reserve Board is urged to conduct an on sight evaluation of Fleet’s predatory 

lending abuses. Fleet’s predatory lending abusive practices are indicative of Fleet’s poor record 

of meeting the community’s convenience and needs. Thus, the application must be denied. 

ICP’s analysis indicates that Fleet’s mega pledge is, .jn fact, lower than each entity’s performance 

individually thus far. We urge the Federal Reserve Board to not be awayed by this unenforceable 

pledge. Fleet’s pledge is laughable in light of Fleet’s prior record of abandoning the communities 

after each acquisition. 

This proposed merger is anti-competitive. Public convenience and needs are not served through 

this merger. The Federal Reserve Board (FRB) should deny this application. 

For the reasons set forth above, the FREI should deny this proposal. 

Respectfully submitted, 

05 

Rashmi Rangan / 

Executive Director 

De. CRA Council. Inc. 
. 

President 

Joan Wallace-Benjamin, Ph.D. 

Chairman 

George A. Russell, Jr. 

Senior Vice President 

Community Affairs 

State Street Corporation 

Vice Chairman 

Samuel J. Gerson 

Chairman & CEO 

Filene’s Basement. Inc. 

Members 

Rev. Gerald E. Bell 

Martha Buchanan-Forte 

Pamela D. Everhart, Esq., CPA 

Emil Frei 

Amy A. Geogan 

Ken Granderson 

Edward E. Guillet 

Paula E. Groves 

Lance A. Hartford 

John Henesey 

Harold W. Horton 

Darcy L. lmmerman 

Nancy K. Kaufman 

Binyah C. Kesselly 

Richard J. Leslie 

Donna Harris-Lewis 

Vincent G. Loporchio 

Tamara Olsen 

Joseph G. Parham, Jr. 

Jack Rossin 

Jonathan Ruelas 

Adrienne Foster Williams 

Brent Williams 

William Julius Wilson, Ph.D. 

Christine Wood 

Tony Wray 

Edward E. Zuker 

Urban League Guild 

Beverly Gibson 

President 

Chairman Emeritus 

The Honorable 

Joyce London Alexander 

THISAGEMCYIS 

SUPPORTEDBY 

United Way 

Of Massachusetts Bay 

0 -URBAN 

- LEAGUE 

OFEASTERNMASSACHUSETTSIN

We put people to Work 

Proposed Merger Fleet Financial Group, Inc. And Bank Boston Corp 

Testimony presented by Dr. Joan Wallace-Benjamin, 

President/CEO, Urban League of Eastern Massachusetts 

July 7, 1999 

Good Morning. My name is Joan Wallace-Benjamin. I am the president 

and CEO of the Urban League of Eastern Mass. The Urban League of Eastern 

hlassachusetts is an 82 year old Civil Rights, direct service, and advocacy 

organization in the City of Boston. We are part of a large national organization of 

114 Urban League affiliates across the country. On behalf of the Urban League 

and the communities we serve, I am here to express our concerns about the 

proposed merger and the accompanying bank branch divestiture. I am also here to 

speak to Fleet Boston’s proposed “Community Investment Plan” as well as its 

likely negative impact, if care is not taken, on minority, low and moderate income 

people, small businesses, and community development programs. 

Before I begin my comments, I would like to take a moment to thank you 

for granting me this opportunity to come before you on the matter of the proposed 

Fleet Financial Group, Inc./Bank Boston Corp. merger. 

The proposed merger is a clear example that the “big are getting bigger”. 

Currently, Fleet and Bank Boston are the number one and number two largest 

banks in New England. If they are allowed to merge, the newly combined Fleet 

Boston Bank will not only be the dominant lender in the New England region, it 

will be the eighth largest bank in the United States. In other words, Fleet Boston 

is about to become a Mega-Bank. 

As we enter the new millennium, banks should be expanding access to 

I 

88 Warren Street 

Roxbury, Massachusetts 02119 

PHONE: (617) 442-4519 

FAX: (617) 442-0562 
credit/capital and affordable investment opportunities to minorities and women 

and in low and moderate-income communities. We are not asking Fleet Boston to 

do this alone. We are asking, however, as a leading lending institution, and \ 

increasingly powerful bank, that it do it’s reasonable and fair share; this includes, 

at the very least, maintaining its pre-merger lending level. Such an institution 

would have a widely disseminated community investment strategy, with 

accountability features built in, that incorporates specific written standards to 

document and measure progress and success. 

Under the circumstances, Fleet Boston’s proposed community commitment and 

set aside of $14.6 billion, over five (5) years, for low-income borrowers, small 

businesses, and community development programs is woefully inadequate. No 

community investment plan with measurable and verifiable indices of progress and 

success has been disseminated for review and/or comment. 

$14.6 billion sounds like a lot of money, however, a closer look clearly demonstrates that 

it is not so much. In fact, this amount is significantly less than Fleet and Bank Boston’s 

pre-merger combined lending in the small business, affordable housing/mortgages to low 

and moderate income borrowers, and the community development investment categories. 

More specifically, the analysis of Fleet Boston’s proposed commitments, regarding 

Fleet’s and Bank Boston’s current lending levels, by Inner City Press [the analysis was 

submitted by Inner City Press to the Federal Reserve Bank as part of it’s June 7 protest], 

using Fleet’s proposed methodology [reduced Fleet and Bank Boston’s 1998 lending 

volume by 20% to take into account the divestiture Fleet has proposed] shows large 

shortfalls in the aforementioned Small Business, Affordable Housing/Mortgages to low 

and moderate income borrowers, and the community development lending/investment 

categories. 

Fleet’s Proposed $14.6 Billion CRA Pledge is Less Than What Fleet and Bank 

Boston Currently Do--even reduced by 20% for divestitures 

5 Year Amount 

2 
\ . . 

Small Business Lending $7.5B 

Affordable Housing/Mortgages to LMI Borrowers $4.OB 

Community Development Lending/Investment S2.OB 

Compare to Fleet’s and Bank Boston’s 1998 volumes, x 5 (for 5 yrs.) and x 0.8 (divest): 

Fleet BKB Total x5 X0.8 Fleet Pledge 

Short-Fall 

-- 

Small 1.5B 588MM 2.1B 10.5B 8.4B 7.5B 12% 

Business 

Lending 

.- 

con-m. 486MM 245MM 731MM 3.66B 2.92B 2B 46% 

Develop. 

Afford- 35.46B * 1.74B * 37.2B * 29.76 ** 29.76B ** 4.OB Laughabl 

able e 

Housing. 

* Fleet’s CRA memo gave these [Fleet’s and Bank Boston’s mortgage loan] figures to the feds. 

It did not, however, give a break down as to the % of those loans that were LMI. **S29.76 

results from $37.2 x 5 x 0.8. 

Rather than creating a lending shortfall, we believe that, at the very least, the 

overall volume of business currently done by the banks should also be maintained after 

the merger. 

The banks do business in eight states. The Community Investment plan, as 

currently designed, is to be dispersed in those states. The fairness or the unfairness of the 

proposed set aside cannot adequately be judged because the banks have failed to provide 

3 
sufficient or detailed information as to how they came up with this $14.6 billion figure or 

how it will be dispersed among or between the eight states in which it will operate. 

Simple mathematical averaging, however, demonstrates that $14.6 billion spread over six 

categories: 

Small Business Lending $7SB, 

Affordable Housing/Mortgages to LMI Borrowers $4.OB, 

Community Development Lending/Investment $2.OB, 

Consumer Lending in LMI Areas $1 .OB, 

Equity Investments $1 OOMM, and 

Technical Assistance and Support $15MM, 

divided by eight (8) over a five (5) year period won’t go very far. 

C)n the issue of the 250-bank branch divestiture, we are opposed to one or more 

large banks being allowed to purchase all of the divested bank branches. Fair competition 

and community service concerns demand that small to mid-sized community and 

minority banks should be allowed to purchase the divested branches. In fact, we strongly 

suggest that, as a minority owned and managed community bank in the City of Boston; 

the only bank that is a Community Development Financial Institution (CDFI) in New 

England, the Boston Bank of Commerce receive a sufficient base of branches to secure its 

position as a primary lender and major minority business. 

No divestiture of a bank branch, in a low income or minority community, should 

be made to a bank that does not intend to keep the bank branches’ doors open. People 

who live or work in these communities should not have to travel long distances or be 

forced to go in to unfamiliar or unwelcoming communities to meet banking needs. 

It is a well-known fact that low income and minority communities are over run with 

4 
check cashing businesses. When bank branches close, people in these communities often 

have to use these check-cashing services. They are easy prey for the criminal element 

. 

who know that no banking deposit privileges are available at these facilities and that the 

check cashing customers, therefore, have no recourse but to keep all of their cash on their 

person. No one should have to risk their safety to have access to their own money. 

We need banks that will aggressively market their products in low and moderate and 

minority communities. This reality is compounded by the fact that past and present 

patterns of discrimination have created an environment where members of these 

communities have not been well served. We need to ensure that women, low and 

moderate income and minority communities are not left, post-merger, with less access to 

fulfill individual and community specialized banking needs. We contend, therefore, that 

we need community and minority banks that will provide quality services and products, 

spur community wide economic and social development, while competing for fair market 

share. 

In our view, in spite of the fact that Fleet/Bank Boston representatives have 

indicated their CEO’s goal of having the new “big” divestiture,buyer(s) pick up the 20% 

share of community investment obligations that Fleet Boston plans to relinquish, we want 

to ensure that this buyer(s) is obligated to meet CRA goals. However, we know that the 

Fleet Boston divestiture plan is not altruistic. It is being done to make the bank more 

profitable and increase shareholder and senior officer wealth. Therefore, as stated earlier, 

they must, as a combined entity, maintain the investment level each bank has currently 

achieved. Knowing that they will be successful, as their asset size grows, a proportionate 

share of those increases must be committed to the community into the future; and make 

achieving these goals a part of their CRA rating. 

We employ you to carefully consider the concerns and recommendations that 

have been cited here before any Fleet Boston merger plans are approved. 

5