AN OPEN LETTER 

The Board of Governors of the Federal Reserve 

FEDERAL RESERVE BANK OF NEW YORK 

New York, NY 10045-0001 

Dear Sirs: 

The recent survey conducted by The New York Christian Times and the Community News 

and Information Service (CNIS) is cause for great concern. We write to direct your attention to the findings and ask that you -the regulators-offer an immediate response to what, Good 

by all accounts, are some very disturbing discoveries. 

The 6.month study was developed and implemented in cooperation with many of New 

York’s major banks, and it fielded 1,000 respondents, representing more than 480 Black 

churches. It is perplexingly clear that although Citibank and other major lending institutions brag about their outreach and home-buyer education programs, most members New 

York’s Black community continue to grope in darkness and lack the very basic information 

regarding the obtaining of a mortgage and the most elementary steps towards home ownership. 

News 

for 

a 

Change! 

We invite you to conduct a similar study by polling the general Black population of New 

York, and we remain confident that your results will not differ significantly from ours. 

If you ask me, it is a down-right disgrace that in a city where the IO top banks and the 5 

major thrifts have assets of over I trillion dollars, one third of the population lacks the basic 

information on how to obtain a mortgage. The one thousand people were asked, “Do you 

know of any organizations that can help you get your first home?” While 830 respondents 

said no, only 170 said yes, and of that number, I I of them listed The New York Christian 

Times, a newspaper, as such an organization. 

1061 

Atlantic 

Avenue 

We draw your attention to the full results of the study (attached), which polled a broad 

cross-section of Blacks at various socio-economic levels, and ask that you move expeditiously to help ensure that Blacks gain fair access to information and mortgages in their own 

communities. 

Brooklyn, 

New York 

11238 

Racism and discrimination in its most subtle form continues to exist in the loan rooms of 

Citibank and other New York banking institutions. It is abundantly clear that the global 

business interests-looking to advance technology and make big profits in Asia, Europe and 

North America - have better and greater access to the more than $1 I billon that Blacks 

deposit in Citibank and the more than $38 billion that Blacks deposit in the I4 other top 

banking institutions than Blacks themselves. 

(718) 

638 

NEWS 

Dollars trickle in Black communities at a slower rate than a slow dripping faucet while 

millions of dollars flow into other communities like a watermain break. In the Sunday, 

April 20. 1997 edition of the New York Daily News, a report stated that the loan rejection 

rate for Blacks was more than double that of Whites. “Even worse, studies revealed that 

Blacks with identical credit backgrounds to that of Whites would often get turned down 

FAX 

(718) 

638 

1810 
while the Whites were accepted,” the article stated. 

The imagery that our major banks are projecting is but a facade similar to the false pretenses that children present to 

their parents at the end of the school day-only to discover on open school night that the picture is not as pretty as 

the one that the student has painted. 

The Christian Times has documented and catalogued information with corresponding material published by Citibank 

and the other major banks and thrifts showing them as “good, caring neighbors”, supposedly working and reinvesting in the community-only to discover that the facts contradict the statements. My grandmother has always said 

that the proof is in the pudding, and she’s right. There is no tangible proof of a pipeline of Blacks getting mortgages 

and commercial loans from Citibank or any of the major banks that enjoy our community’s deposits, and even the 

most recent data will show that many smaller banks and mortgage banks sell more mortgages to our community than 

the area’s banking giants. 

We are not suggesting that banks should not work to further their economic interest and enjoy good business in this 

“free enterprise society”. However, we are very concerned that this is being done at the expense of our race, 

although they manage to cloak the “nothing” that they do in a few community corporate responsibility activities and 

market maintenance advertising. 

It occurs to me that Citibank and others are playing Tickle-Me-Elm0 with regulators. They seem to rush out when 

necessary and drop a few loans in our community to satisfy their CRA requirements and make a few people happy, 

if but for a quick second. Anything to win a merger-then it’s back to business as usual. 

In view of this report, we call upon you, the enforcement community, to tighten the laws and its enforcement. The 

Citibank - Travelers merger must be blocked if we are to protect local communities. But more so, our community 

needs your help in ensuring that we have, at the very least, the same access to our deposits as people of other 

communities have to these dollars. Only last year, an executive at Citibank told me that Citibank’s interest is in the 

global market. That means using local deposits for g/oba/ investments. And as far as Citibank is concerned, the 

BlacWLatino communities here in New York can go to take a hike. 

Secondly, we draw to your attention the fact that mortgage and house buying information is not reaching our community with any degree of effectiveness. The level of ignorance is disturbing and the real slap in the face is that 

these banks invest millions of dollars in an effort to educate and counsel potential home buyers through organizations that are foreign to our community. 

These organizations, although heavily funded by mega-banks, remain “best kept secrets” in New York’s Black 

community. as the survey reveals, while hard-working organizations that are indigenous and popular among its 

people struggle to educate and inform potential home buyers with little to no support from the banking community. 

One may need to question the seriousness of Citibank and these other banking institutions and the motive behind 

their involvement in our community. Are they driven by a desire to sell mortgages and make a profit in doing so or 

are they more concerned about getting our deposits for their global enterprise and then issuing a few mortgages to 

make it look good? 

They themselves admit that there is not a pipeline of Blacks rushing to get loans-but considering the past history of 

redlining, the present lack of education and the convenient passage of misinformation. Black New Yorkers are 

suffering from the once bitten, twice shy syndrome. WE SEEK YOUR INTERVENTION! 

merely, / , , 
Citibank & Others 

Discriminate Against Blacks 

Reprintedjrom The New York Christian Times, October I-IS, 1997 

A recent report made public by the office of Congressman Charles Schumer reveals that 

racial discrimination is alive and well at the city’s banks and savings and loan institutions. The 

city’s three largest banks still issue mortgages and other loans along racial lines, the study reveals. 

But according to Rev. Dennis Dillon, publisher of the Christian Times and a leading advocate for bank consumers, banks doing business in New York’s Black community have always had 

and maintain a pattern of discrimination against Blacks. “If these banks, namely Chase, Citi and 

Fleet, have such a pitiful record when it comes to mortgage loans to our community, imagine how 

bad the numbers must look when it comes to business loans,” Dillon said in a recent statement 

released following the report. “While the government monitors the banks’ activities relative to 

home mortgages and mandates that banks disclose their mortgage applications and rejections by 

race through the Home Mortgage Disclosure Act (HMDA data), no such requirements is in place 

for commercial loans,” he explained. 

Despite a near Black majority in New York City, Chase Manhattan received 57,500 White 

applicants for mortgages compared with 3,900 Black applicants and 5,200 Hispanic. While Fleet 

has received 25,000 applications from the White community and 2400 from the Hispanic, only 

1,600 were taken from the Black community. Citibank received 8,000 White applicants compared 

with 2,000 Hispanics and 665 Black applicants; Dime had 2,600 White applicants compared to 220 

Black applicants. 

‘It is criminal that the 4 leading banks for Black depositors in New York took 93:lOO 

mortgages from White applicants, 10,000 from Hispanics and only 5,385 from Blacks, and on top 

ofthat. Blacks with the same credit circumstances as Whites were rejected almost 3 times as often.” 

said Dillon. “How do you take the city’s most powerful consumer group that makes the most 

significant deposits and then give them the least amount of loans after you have taken the least 

amount of applications from them. This is evil.” he contends. 
2 1st Century Partnership 

BankWatch 

THURSDAY, June 25, 1998, NEW YORH 

CITIBANR TRAVELERS MERGER DRAWS CO MMUNITY CONCERNS 

NEW YORK GROUP SAYS CITICORP/TRAVELERS MERGER NEEDS A CLOSER LOOK 

Date: June 25th. 1998 

To: Members of the CitlBank/Travelers Hearing Panel 

From: Rev. James H. Daniel. Jr. 

Ladies and Gentfeman. unfortunately because of a prior commitment to 

a “Faith Based” community devezopment conference in upstate New York 

I’m unabZe to personally present testamony on the CitiBank/TraveZers 

merger, however the young man before you is more than capable of 

presenting our thoughts succinctly . 

First let me state that the biggest merger In American History Should Be 

Closely Scrutinized Before Being Passed. 

We of the 21st Century Partnership have had a relationship with CitiBank 

for over 10 years and believe that they mean well in their efforts to meet 

the credit needs of their service area, however, meaning well and doing 

well are distinctly different. The banks CRA rating needs to improve 

Because the merging financial institutions have not at this point given 

any indication of how this proposed merger will serve the public interest 

and more particularily low to moderate income communities: the 

investment alliance believess consideration for appproving the merger 

should be considered based upon a definative community re-investment 

plan with a deflnative action plan and timeline created in consultation 

with community organizations and elected officials from the impacted 

communities. 

We call upon the government bank regulators, members of the U.S. 

Congress and Senate to look more carefully at biggest merger in history: 

This merger at face value does very little to expand credit and other 

needed t%mncial services in inner city communities right now it only 

increases the value of Citibank and Travelers stock. It is important to 

note that Citicorp has a less than exemplary CRA record among the 

major banks. Salomon Brothers and Smith Barney have never developed 

any community investment plans and Travelers Insurance is a redllner 

with little presence ln the miniorlty community. While Citibank does have 

some presence in low income communities one can only hope that lf this 

merger goes through that before it does there will have been a plan 

developed in cooperation with the- broader community that succintly 

details how the bankwill do better than it presently does. 
, Our concerns with these findings and CitiRanks lack of substanative 

involvement in support of community programs the members of the 

Alliances BankWatch Community Leaders and Financial Services 

Committee believes that if government regulators were to earnestly 

assess CitiRank re-investment records they would rate them with a “Need 

To Improve” and stipulate such that before any merger is approved there 

rating must substantially increase. 

I at this time would like to raise another point this country already has 

enough crime and in a number of circles it is believed the merger is illegal. 

This illegality stems from a notion that Alan Greenspan the Federal 

Reserve Chairman, in a closed door weekend meeting with Citicorp, 

tentatively agreed to give Citicorp an exemption from the law without 

approval from Congress one can only trust that such allegations are just 

allegations. 

. When we hen; that the Chairman of Travlers made over 208 million dollars on 

the day the merger was announced, just from the announcement of the merger, and 

that this amount is more than his company contributed to minorities over its entire 

history we hope that such enormozrs amounts of m,oney can somehow find it’s way 

into areas where poverty still reigns. 

According to research conducted by the Greenlining Institute of California The CEO 

of Citicorp, John reed made more onthe day of themerger ($62 million) than 

Citicorp contributed to low income groups over the last three years. 

. Prince AIwaleed of Saudi Arabia, a major shareholder, made 1.5 billion dollars 

on the same day from the announced merger; he has no known U.S. chairitable 

program aimed at inner cities or or inner city residents 

. One other interesting note is that the combined company will be largest financial 

institution in the world with 160,000 employees providing they don’t have a mass 

lay off because bf the merger, they will have 70 billion dollars in revenue, and seven 

billion in earnings. 
These are the Issues as we now see them 

Alan Greenspan and/or Secretary of the Treasury Robert Rubin can delay or stop 

this merger if they want and they should if as is alleged that under present law the 

merger is ILLEGAL and if we accept that as a fact then something that starts out 

illegally is more than likely to end up the same. 

Let us consider the following, if the merger deal is successful, Merrill Lynch and 

Wells Fargo would most likely disappear as seperate enities. Chase manhattan 

Bank could consider purchasing Mm-ill Lynch and even Bank of America could be a 

thing of the past if this proposed merger is approved, and after that why not Fleet 

Bank and Amer+can Express or Allstate 

We have laws against monopolies and with this merger leading the way can 

America afford a monopolized banking industry, under the guize of more efficent 

and low cost financial services and if the answer is yes what assurances will low 

income communities have that they will be better served because of these mergers 

and will any of the alleged cost savings reach underserved communities through 

greater access to credit?; 

While we would like to believe so we however, without a definative plan as to 

how, believe that any approval of this merger should be associated with a definative 

plan worked out in consort with the affected communities in advance of any 

approval of the applications. While the 21st Century Partnership has enjoyed the 

support of CitiBank and would welcome the expansion of our relationship; we call 

upon them to act in a more responsible and accountable manner than what is 

ehibited in their present efforts around this merger and more particulerly to 

commit to getting a n”Outstanding CRA rating. 

There must be a direct correlation between what CitiBankJTravelrs puts on paper 

and what they invest in commuities through lending and philanthropy and 

presently we don’t see that in this present merger. In closing we choose to believe 

that CITIBANK and Travelers want to do the right thing and if the merger is 

approved as is or in a modified state we will work with them to the degree that it 

becomes possible to assure that the delivery of quality financial products and 

e under-banked and people in general is a reality . We call 

s and elected representatives to help them do just that for