| FirstSun Bid
for First Foundation Challenge
to Fed Now Brags about Evading
Lax State CRAs
by
Matthew Russell Lee, Patreon Book
Substack
SOUTH
BRONX/Federal
Court,
Feb 11 – A proposed
acquisition by FirstSun, whose
merger bid failed, of First
Foundation has given risen to
a challenge under the
Community Reinvestment Act.
On
December 5 Fair Finance Watch,
reviewing Home Mortgage
Disclosure Act data of 2022
and 2024, filed a CRA
challenge to the merger with
the Federal Reserve Board:
This is
opposition the Applications of
FirstSun Capital Bancorp,
Denver, CO (& Dallas TX)
to merge with First
Foundation, Inc., Irving,
Texas, and thereby indirectly
acquire First Foundation
Bank.
FirstSun's flagship Sunflower
Bank, in Texas in 2024, made
401 mortgage loans to whites,
and only 46 to African
Americans. Meanwhile it denied
12 applications from African
Americans, and only 36 from
whites.
This is
disparate, and more disparate
both than the aggregate in
Texas.
Nationwide in 2022, Sunflower
Bank made 2248 mortgage loans
to whites, and only 104 to
African Americans. Meanwhile
it denied 24 applications from
African Americans, and only
162 from whites.
FirstSun's record has grown
even worse than in 2022, which
Fair Finance Watch analyzed in
commenting against FirstSun's
ill-fated Home Street
proposal. Now, First
Foundation is not only
"unloved" - it has had massive
CRE and other
problems.
For the
record, on managerial
resources and otherwise, note
that this proposal involved a
complex restructuring,
including a $3.4 billion
downsizing plan, which is said
to carry not only community
harm but also execution risk.
The price paid for First
Foundation has also raised
concerns among some
analysts. As with Fifth
Third / Comerica, there has
been a legal inquiry launched
by a class action firm
regarding the merger with
First Foundation.
The Federal
Reserve Bank of Kansas
including about state CRA
laws. On February 11, this
response: "Should any state
reinvestment laws apply to the
proposal, please discuss
FirstSun’s and the proposal’s
compliance with those laws.
Response: None of the
jurisdictions in which First
Foundation Bank operates
branches has community
reinvestment laws that apply
to this transaction. We note
that the state of Nevada has a
requirement that financial
institutions notify the Nevada
Commissioner of Financial
Institutions of the public
availability of the financial
institution’s current CRA
rating as soon as such rating
becomes publicly available and
conduct CRA training sessions
for persons and organizations
that operate within the
community served by the
financial institution.1
Sunflower Bank will comply
with this state requirement
subsequent to the Merger,
subject to its operation as a
national bank under the
National Bank Act. One of the
jurisdictions in which
Sunflower Bank operates
branches, Washington, has
community reinvestment laws.2
However, the state community
reinvestment laws of
Washington only apply to
Washington state-chartered
banks, and thus do not apply
to this transaction."
And see, e.g.,
Sept 10, 2025: https://www.americanbanker.com/opinion/the-fdic-is-undercutting-a-key-element-of-the-cra
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