GOOD EVENING. I HAVE TRAVELED TODAY FROM MENDOCJNO COUNTY 

LOCATED ABOUT 100 MLLES NORTH OF SAN FRANCISCO. MENDOCINO 

COUNTY IS A RURAL CALIFORNIA COUNTY WITH A POPULATION OF 86,000 

AND TRADITIONALLY HIGH UNEMPLOYMENT AND POVERTY RATES. 

TEN YEARS AGO, THE ORGANIZATION WHICH I DIRECT WAS FOUNDED TO 

ADDRESS ECONOMIC SELF-SUFFICIENCY AMONG LOW-INCOME PEOPLE. 

THE WEST COMPANY PROMOTES MICROENTERPRISE AS A STRATEGY TO 

INCREASE ECONOMIC SELF-SUFFICIENCY FOR PEOPLE WITH LIMITED 

ACCESS TO ECONOMIC RESOURCES. 

ONE OF THE FIRST COMMUNITY PARTNERS TO JOIN THIS ENDEAVOR WAS 

THE BANK OF AMERICA. ORIGINALLY, THE FOUNDATION CAPITALIZED 

THE MICROLOAN FUND WITH A $10,000 GRANT. TWO YEARS LATER IN 

1993, THE FOUNDATION PROVIDED A $99,000 GRANT THROUGH A 

COMPETITIVE .ECONOMIC DEVELOPMENT INITIATIVE THIS GRANT ADDED 

$60,000 TO THE LOAN FUND AND $39,000 FOR TECHNICAL ASSSISTANCE TO 

BORROWERS AND COMMUNITY CAPACITY BUILDING. DURING THE SAME 

ERA, THE LOCAL COMMERCIAL BANK OF AMERICA BRANCHES PROVIDED 

HUMAN CAPITAL TO WEST COMPANY’S BOARD OF DIRECTORS AND 

MICROLOAN FUND COMMITTEE. AS WELL, BANK OF AMERICA PAID THE 

SALARY AND PLACED A FORMER BANK OF AMERICA EMPLOYEE AT WEST 

COMPANY FOR A PERIOD OF SIX MONTHS. WE WERE ALSO ABLE TO 

OBTAJN NO COST ACCOUNTS FOR LOW-MCOME CUSTOMERS. 

THE IMPACT OF BANK OF AMERICA’S INVESTMENTS ON ONE RURAL 

CALIFORNIA COUNTY HAS BEEN IMMENSE. AMONG THE OUTCOMES, 

BANK OF AMERICA HAS: 

l HELPED TO BUILD THE CAPACITY OF A COMMUNITY-BASED 

ORGANIZATION TO BRING LOW-INCOME ENTREPRENEURS INTO THE 

MAINSTREAM 

G&a us’-/a 

l PROVIDE $197,458 IN LOANS TO 61 NONBANKABLE CUSTOMERS 

T WITH THE START-UP OF 40 BUSJNESSES AND THE EXPANSION OF 
I AM HERE TODAY TO COMMEND THESE CONTRIBUTIONS AND THE 

COMMITMENT THAT THEY DEMONSTRATE TO RURAL CALIFORNIA 

COMMUNITIES AND TO MICROENTERPRISE AS AN ECONOMIC ENGINE. I 

AM HERE TODAY TO ASK FOR RENEWED COMMITMENT TO THE RURAL 

INITIATIVE AS DEVELOPED DURING THE LAST YEAR BY BANK OF 

AMERICA AND ITS COMMUNI TY PARTNERS. I AM HERE TODAY TO ASK 

THAT THE BANK OF AMERICA FOUNDATION AND THE BANK OF AMERICA 

COMMUNITY DEVELOPMENT BANK AS THEY CURRENTLY EXIST BE 

RETAINED IN CALIFORNIA. 

THANK YOU FOR THE OPPORTUNITY TO TESTIFY AT THESE EXTREMELY 

IMPORTANT PUBLIC HEARINGS. 
FIRST NATIONS .DEVELOPMENT INSTITUTE 

The Stores Building - I 1917 Main Street * Fredericksburg, VA 2240 

(540) 371-5615 . Fax (540) 371.3505~ 

Re: Proposed acquisition of 

Federal Reserve System 

20” Street & Constitution Avenue 

Washington, D.C. 20551 

Bat&America Corp. and its 

subsidiaries by NationsBank Corp. 

Dear Secretary Johnson and Board of Governors: 

Please consider the enclosed oral and written testimony and attachments our timely 

comment on the proposed merger of NationsBank Corp. and BankAmerica Corp. The oral 

portion’was presented by Board Chairman B. Thomas Vigil at the July 9 public meeting 

condocted at the Federal Reserve Bank of San Francisco. The written portion, with attachments, 

was submitted on the same day to Federal Reserve Bank of San Francisco officials, per the 

instructions issued July 6 by’community affairs officer Joy Ho&ran Molloy. 

We appreciated our participation in the meeting. We are available to answer any 

questions. 

Attachments: Testimony, oral and written 

List of letters of support 

Survey findings 

Statement of Chester Carl, National American Indian Housing Council 

Organizational Descriptions 

cc: A. Linwood Gill III 

Assistant Vice President 

Federal Reserve Bank of Richmond 
FIRST NATIONS DEVELOPMENT INSTI~JTE 

The Smres Building . 11917 Main Street . Fredericksburg. VA 22408 

(540) 371.5615 - Fax (540) 371-3505 

Testimony of B. Thomas Vigil 

Chairman of the Board 

First Nations Development Institute 

before theSorrd of Governors, 

Federal Reserve System, 

Federal Reserve Bank of San Francisco 

July 9, 1998 

Governors and members of the Federal Reserve System, ladies and gentlemen: 

Greetings. My name is B. Thomas Vigil. I am a member of the Jicarilla Apache Tribe and 

my mother is from a tribe called Jemez, both in New Mexico. I own and operate several 

businesses, mostly on the Jicarilla Apache reservation. These businesses, including a hotel and a 

guest ranch, obviously require extensive banking relationships. It has been my experience that 

small local banks can offer very limited services for such businesses, because of their limited 

access to capital. Often we’ve had to go outside our community to establish these larger banking 

arrangements. This need for outside resources is not limited to our dealings in New Mexico.‘From 

the more national perspective of First Nations Development Institute and its many relationships 

with entrepreneurs and entrepreneurial organizations across the nation, access to larger capital 

resources is a regular business need and a critical hindrance to development. 

Today, I come before you as the Chairman of the Board of First Nations Development 

Institute. As an organization, First Nations Developmeni Institute has been assisting the culturally 

directed economic development efforts of Native American tribes and organizations for almost 20 

years. During this time, banks have bee n a steady focus,of our efforts to bring about economic 

relationships in the remote rural communities that characterize Indian Country. While First 

Nations has not specifically focused on metropolitan Native populations, we know that they too 

have often lacked access to credit. For most Native individuals in any location, banking 

relationships have not existed in the past. 

But we have seen a groundswell of banking interest in Indian Country in recent years. 

Gaming and other developments have led to an aggressive movement for banking services in 

Indian communities. Especially in the last two years, we have seen the emergence of what may 

well be a critical mass of lenders and regulators dedicated to making a difference in the provision 

of financial services to Indian people. 

As a function of our normal efforts to keep Indian communities informed of their rights 
under the Community Reinvestment Act, and since the announcement of the 

NationsBaMBankAmerica merger, First Nations has conducted a survey of banking needs in 

Indian communities, the findings of which are attached. Our survey of 177 tribal and non-profit 

organizations in the 22 states affected by the proposed merger reveals a woefully inadequate 

collective encounter with mainstream financial channels. The vast majority of tribes and Native 

organizations had not had any experience with either NationsBank or BankAmerica, nor did they 

know of any NationsBank or BankAmerica activities in the Native community. The prevailing 

view among tribes and Native organizational representatives is that big banks in particular don’t 

do business in Indian Country. And notwithstanding the accelerated banking activities of the past 

five years, only 91 home mortgages have been closed on tribal land during that same period - 91 

homes in a market with an estimated need of 200,000 (attached). 

Despite the shortcomings revealed in our survey, we remain optimistic that a critical mass 

of problem-solvers, responsible borrowers and business interests will eventually bring full-fledged 

banking and financial services to Indian communities. We are pleased that 

NationsBaMBankAmerica has agreed to be a part of this progress,following the proposed 

merger..Not only have they included a specific mention of Indian Country in their pledge of $10 

billion in lending and investments for iommunity and economic development in rural areas over 

the next 10 years; but in a meeting June 16 with First Nations and other Native American groups, 

they also agreed to work with First Nations and a Native task force on an analysis of loan 

products and financial services that would inform a Native American-specific lending goal. 

The stated commitments of the two banks will greatly mitigate our original concerns 

regarding competitive factors and the convenience and needs of Indian communities under the 

merged entity. Our concerns were based on NationsBank’s lack of experience with Native, 

Americans, due to the small number of reservations and Native urban population centers in the 

south and southeastern states where NationsBank’s holdings are concentrated. In western and 

southwestern states where BankAmerica is concentrated, on the other hand, Native Americans 

number close to 1 million (almost half of all Native Americans), including 426 tribes and 18 of the 

top 25 urban Native population centers. In brief, BankAmerica has begun to initiate progress in 

financial services for Indian people and organizations; NationsBank has not. 

But NationsBank has provided assurances that the merged bank will take a progressive 

approach to providing banking and financial services for Indian communities in its newly acquired 

service areas. And to be quite candid, we consider it a good sign that a bank with so little 

experience in Native-specific lending should come to the table with a commitment to learn how 

successful lending and financial services can be provided in Indian Country This approach 

suggests to us that the merged entity intends to do the job of community development lending 

right, rather than simply drafting Indians as window dressing with a pledge of loans that won’t 

materialize. As long as the NationsBankiBankAmerica commitment of June 16 to an executive 

task force, products and services analysis, and eventual Indian-specific lending agreement are 

honored, First Nations will support the proposed merger. 

We reached this decision based on considerable, serious thought. As you may remember, 

we are the people who have been promised more than any other group in this country, and which 
promises have seldom been kept -- i.e., I... as long as the wind shall blow, and the streams shall 

flow, and the grass shall grow . ..I We intend to hold the merged entity toits promises. And once 

this merger is approved, we trust the Federal Reserve System will actively oversee the fulfillment 

of these promises. 

We appear here today bearing letters of support from 29 tribes and nonprofit 

organizations within service areas that would be affected by then proposed merger, and in 

cooperation with the 400-plus-member National American Indian Housing Council, the 200-plusmember National Congress of American Indians, the Native American Rights Fund, and the 

Council of Energy Resource Tribes. 

Thank you for receiving our presentation.