Orders Issued Under Bank Merger Act

Federal Reserve Bulletin, July, 2001 by Robert Dev. Frierson

(14.) The commenter also criticized OKB's record of hiring, promoting, and compensating African Americans, and alleged that African Americans were underrepresented at OKB among lending officials, loan underwriters, and senior officers. The Board has noted previously that the racial composition of a company's workforce and a company's compensation of members of racial groups are not among the factors that the Board is authorized to consider among convenience and needs factors. See Deutsche Bank AG, 85 Federal Reserve Bulletin 509 (1999).

(15.) This review included an examination of the fair lending policy statement adopted by the board of directors of Old Kent and OKB in June 2000; OKB's fair lending plans that govern its consumer and business lending operations; OKB's consumer compliance guide and training materials; OKB's consumer loan guidelines; and various underwriting standards and training materials.

(16.) OKMC participated in programs sponsored by the Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, Federal Housing Administration, U.S. Department of Housing and Urban Development ("HUD"), Veterans Administration, the State of Illinois, and the City of Chicago.

(17.) The commenter alleged that OKB staff has directed African Americans away from the Historic Chicago Bungalow Initiative ("Bungalow Initiative"), a city-sponsored program that encourages the restoration of bungalow-style homes in Chicago and provides special opportunities and incentives to LMI families. Fifth Third noted that OKMC began to participate in the Bungalow Initiative in late 2000, and that data on borrowers are not available.

(18.) The aggregate represents the cumulative lending to borrowers for all institutions that have reported small business lending data in counties that are included, in whole or in part, in OKB's Chicago assessment area. Aggregate data for 2000 is not yet available.

(19.) In this context, "small business loans" means loans in amounts of less than $1 million.

(20.) In this context, "loans to small businesses" means loans to businesses with gross annual revenues of $1 million or less.

(21.) All other home equity loan applications are originated by OKB through its branches and by telephone at its Direct Banking Center in Grand Rapids, Michigan. These applications, unlike those received by OKMC, are sent electronically to OKB's central underwriting department in Grand Rapids for underwriting. The central underwriting department also performs a second review when requested by the originating OKB branch. Senior officers in the bank's Chicago assessment area may approve home equity loan applications that are not approved by underwriters in Grand Rapids.

(22.) The commenter requested that the Board hold a public meeting or hearing on the proposal. The Bank Merger Act does not require the Board to hold a public meeting or hearing on an application. Under its rules, the Board may, in its discretion, hold a public meeting or hearing on an application to acquire a bank if a meeting or hearing is necessary or appropriate to clarify factual issues related to the application and to provide an opportunity for testimony. 12 C.F.R. 262.25(d). The Board has considered carefully commenter's requests in light of all the facts of record. In the Board's view, commenter has had ample opportunity to submit his views, and his submitted written comments have, been considered carefully by the Board in acting on the proposal. The commenter's request fails to demonstrate why his written comments do not present his evidence adequately and fails to identify disputed issues of fact that are material to the Board's decision that would be clarified by a public meeting or hearing. For these reasons, and based on all the facts of record, the Board has determined that a public meeting or hearing is not required or warranted in this case. Accordingly, the request for a public meeting or hearing on the proposal is denied.