San Francisco – In response to an announcement earlier today that the Federal Reserve and the Office of the Comptroller of the Currency (OCC) will hold a joint public hearing about the proposed bank merger of Union Bank into U.S. Bank, Chief of Legal and Strategy Kevin Stein released the following statement:
“While we are pleased to see that the Federal Reserve and the OCC have granted our request for a public hearing, we hope that this is the beginning of the end of regulatory rubber stamps for big bank mergers without any demonstration of public benefit.
“This merger, and all mergers, need to be closely scrutinized to ensure there will be a public benefit. A public hearing is an important part of that, but not the extent of it.
“CRC and our members have significant concerns about impending U.S. Bank branch closures, mortgage lending disparities, and the prospect for a new megabank to provide less support for California communities than the two banks separately.
“U.S. Bank should commit to no branch closures in neighborhoods of color and low-to-moderate income neighborhoods, special purpose credit programs to promote homeownership and small business ownership for Black, Indigenous and People of Color communities, and a substantial increase in reinvestment in affordable housing, broadband infrastructure, and other critically needed stabilization and wealth-building initiatives in our state.”
In November, CRC submitted a letter to both agencies formally opposing the merger. More than 60 California-based organizations signed on in support of the opposition letter, while several other CRC member and allied organizations submitted their own letters opposing the merger. In the letter, CRC called for U.S. Bank to enter into a strong Community Benefits Agreement — with $90-billion for California — as well as public hearings in Los Angeles, San Francisco, and Fresno.
The agencies have scheduled the public meeting virtually on March 8, 2022, at 11:00 a.m. EST.
Minneapolis-based U.S. Bank agreed to acquire Union Bank in September 2021 for approximately $8 billion. U.S. Bank currently has 469 branches in California — which accounts for roughly 20% of all of its total branches—and $51 billion in deposits in the state. Union Bank has 284 of its 305 Branches in California and $98 billion in deposits statewide. Combined, this would become the fifth-largest bank in the state.
The potential merger raised several concerns, including branch closures and staff layoffs, mortgage lending disparities, overdraft consumer fees, and decreased affordable housing lending and investment.
“If the merger is eventually approved, we’d hope to see the new bank reinvest more in local communities than the two existing banks do currently,” Stein said.