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By Matthew Russell Lee, Patreon
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FEDERAL COURT / S Bronx, April 9 – Whether or not the U.S. Community Reinvestment Act will be again enforced until the new Administration and its regulators is an open questions.

  On the 10th day of the new Administration, Fair Finance Watch with Inner City Press on the FOIA filed comments with the post-Brooks Office of the Comptroller of the Currency and with the Federal Reserve on a proposal by VeraBank of Texas to acquire Panola National Bank.

 The issues include that the applicant VeraBank in Texas in 2019 made 465 home loans to whites and only NINE to African Americans. Its denial rate for African Americans was more than FOUR TIMES than for whites.   

   That is to say, VeraBank in Texas in 2019 made 3.7 loans to whites for each denial to whites. It made less than one - 0.81 - loans to African Americans for every denial to African Americans.

   There is also this: "'In the second round we have seen about half the number of requests that we did in the first round,' said Brad Tidwell, president and CEO of Henderson-based VeraBank."

  To the OCC, the rubber-stamping of mergers by redliners under Brian Brooks and Joseph Otting has been explicitly noted.

  And typical of the OCC, without any notice or explanation, it quietly in its Weekly Bulletin listed the application as "Withdrawn" - "Details WITHDRAWN 3/1/2021 BUSINESS COMBINATIONS 2021- SO COMBINATION 319599 VERABANK, NA PANOLA NATIONAL BANK 1510 WEST PANOLA CARTHAGE TX PANOLA."

The OCC should have, and still should, email Inner City Press and Fair Finance Watch and explain.

But now, in a footnote in the Federal Reserve Board Order rubber-stamping the Bank Holding Company Act application without any Additional Information letter, the Fed says the applicant "would continue to operate Panola Bank as a separate standalone bank. VBI has represented that it intends to merge Panola Bank with and into VeraBank at some time after the first merger is consummated. The bank mergers would be subject to approval by the Office of Comptroller of the Currency (“OCC”) under section 18(c) of the Federal Deposit Insurance Act, 12 U.S.C. § 1828(c)."

So VeraBank withdraw the OCC application, and replied on the Federal Reserve rubber stamping, which the Fed has now done, while long delaying FOIA requests about branch closings and now, WireCard. We'll have more on this.

  VeraBank CEO Brad Tidwell earlier responded to the Federal Reserve - but sent it only by regular mail, and not email. Now we have it, and it says among other things: "We take the issues that Mr. Lee raised in comment seriously, and we know that VeraBank, like all banks, can improve in extending credit to minority borrowers." Yes. It goes on: "relevant data for the 2019 HMDA reporting period: VeraBank had a 42% denial percentage for African American applicants and a 14% denial percentage for white applicants."

Is this acceptable?

The Fed has asked: "Page 16 of the Y-3 application describes the applicant’s plan to consolidate VeraBank’s branch located at 1708 East End Blvd North, Marshall, TX 75670 into the existing Panola National Bank branch located at 2203 Victory Drive, Marshall, TX 75672. VeraBank’s branch is currently located in a moderate-income/majority-minority census tract (0203.02) and Panola National Bank’s existing branch is currently located in an upper-income/non-majority minority census tract (0203.01). Please provide further information about the applicant’s rationale for consolidating VeraBank’s branch into Panola National Bank’s branch, and VeraBank’s plans to mitigate the impact of the consolidation on the bank’s community in the location to be closed. 2. Please provide an update on VeraBank’s Community Reinvestment Act efforts since the April 27, 2020, Community Reinvestment Act Performance Evaluation."

  The interim response, by email, is not from CEO Tidwell, but rather outside counsel, and says, "Please direct all future correspondence on this application to me."

These are litmus tests. And they are being failed. Watch this site.

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