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FEDERAL COURT / S Bronx, May 25 – Whether or not the U.S. Community Reinvestment Act will be again enforced until the new Administration and its regulators is an open question. And the proposed merger of two redlining banks, M&T and People's United, will be the litmus test, see below.

  While that still pends in the Federal Reserve, with a promised expedited FOIA response still not forthcoming, the Fed in mid May approved PNC - BBVA, with a rare abstention by Governor Lael Brainard, albeit on antitrust and not CRA or fair lending grounds. But now on May 25, Governor Brainard didn't even abstain on Huntington - TCF, despite HHI Index going over 3000 in multiple markets. Limiting antitrust concern to those with $250 billion is unwise, and arbitrary. The minimal branch divestitures are just window dressing. We'll have more on this.

  On March 27, Fair Finance Watch and Inner City Press on the FOIA filed a challenge with the Federal Reserve to the banks' application, below. We await full response to the FOIA.

 On April 12, the Federal Reserve asked M&T 32 questions, including:

"Provide People’s United’s record and experience with customer complaints and the types  of actions taken by the company to resolve these complaints. Explain the complaint  handling process, including identification, evaluation, monitoring, and resolution.  Identify the number of complaints received during each of the last two years and how the  complaints were resolved. Discuss the policies and procedures People’s United has in  place to protect customers and resolve complaints. Please also provide plans for an  integrated complaints process and any early measures to monitor consumer complaints  following consummation of the proposed transaction.

 9. Indicate any legal proceedings/investigations related to consumer protection concerns  that either M&T or People’s United may be involved in. Describe the nature of the  litigation, the progress of the litigation to date, and how management is responding or  intends to respond. Provide an evaluation of the likelihood of an unfavorable outcome  and an estimate, if possible, of the amount or range of potential loss and customer impact.  10. Provide any consumer compliance-related due diligence results of People’s United.  Provide specific results related to fair lending assessments for lending and branching in  the various geographies. 

11. Provide the most recent consumer compliance risk assessments for both M&T and  People’s United, compliance testing and compliance risk assessments for the prior two  years, as well as any corrective action taken. Also, for each institution, provide reports  used by management and the board for tracking outstanding audit and compliance issues,  minutes and materials from board and committee meetings that have occurred  surrounding such issues, as well as the proposed integrated governance structure for  MIS/Reporting. 

12. With respect to the 2019/2020 Compliance Monitoring and Testing Schedule, discuss  whether the schedule was satisfied by both institutions and what  changes/recommendations were made, if any. For both institutions, provide the 2021  monitoring and testing plan, if available. Additionally, for both institutions, provide  service level agreements for third party service providers and vendors that are listed as  owners of listed regulatory areas. 

13. Provide the following policies for both institutions: Enterprise Compliance Policy, Fair  Credit Reporting Act Policy, Fair Debt Collections Practice Act Policy, Adverse Action  Notice Policy, Customer Complaints Handling Manual, E-Sign and Electronic  Documents and Communications Policy, Fair Lending Policy, Federal Right to Financial  Privacy Policy, Servicemembers Civil Relief Act Policy, Equal Credit Opportunity Act  Policy, and UDA(A)P Policy. To the extent that any of the aforementioned policies are  embedded in an overarching policy, identify and provide the overarching policy. 

14. Provide any and all fair lending/CRA analysis conducted on anticipated branch closures  of People’s United and HMDA activity in connection with the proposed transaction, risks  identified and plans to mitigate. 

15. Discuss any plans to provide new or modified consumer products in connection with the  proposed transaction as well as the review, approval, and evaluation processes for such  consumer products and their related technology transition plans. Also provide details of  the compliance review and approvals, including controls related to new or modified  consumer products."  Full letter here.

   Inner City Press / Fair Finance Watch filed this challenge: "This is a timely first comment opposing and requesting an extension of the FRB's public comment period on the Applications by M&T Bank Corporation to acquire People's United Financial.   

   The applicant M&T in New York State in 2019 made 8,613 home loans to whites and only 629 to African Americans.  M&T in New York State in 2019 made 3.4 loans to whites for each denial to whites. It made only 1.4 loans to African Americans for every denial to African Americans.  

 This is totally unacceptable.       

  The applicant M&T in Connecticut in 2019 made 251 home loans to whites and only 27 to African Americans.  M&T in Connecticut in 2019 made 2 loans to whites for each denial to whites. It made only 1.28 loans to African Americans for every denial to African Americans.    This is unacceptable. 

        The applicant M&T in Pennsylvania in 2019 made 3565 home loans to whites and only 106 to African Americans.

 M&T in Pennsylvania in 2019 made 2.52 loans to whites for each denial to whites. It made only 1.15 loans to African Americans for every denial to African Americans. 

  This is totally unacceptable.

     Meanwhile, People's says it will close some 140 branches.   

    FFW and Inner City Press have been deeply concerned about the rush by the FRS' penchant to rubberstamp mergers by redliners, particularly during the pandemic. We note the Fed's recent website statement that a comment period has been extended to allow participation amid the Coronavirus crisis. This should be done, by the Fed's logic, on this and other applications. We timely request public hearings.  

 The hearings, and your review, should also address M&T's discrimation, see, e.g., (EEOC v. Manufacturers and Traders Trust Co., d/b/a M&T Bank., Civil Action No. 1:16-cv-03180-ELH) in U.S. District Court for the District of Maryland, Northern Division.  See also, this.

  The comment period should be extended; evidentiary hearings should be held; and on the current record, the application should not be approved.

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