LA Community Leaders Gather at OneWest Bank HQ to Denounce Multi-Billion FDIC Subsidy


December 16, 2014- Pasadena, CA: At a press conference today, LA community leaders will release new data that has not previously been shared with the public about the amount of money the FDIC has paid to OneWestBank under two controversial shared loss agreements. OneWest is part of a proposed, Too Big To Fail bank merger with CIT Group, a merger that over fifty organizations are opposing.

After the CEO of the bank refused to disclose how much money the bank received from the FDIC, the California Reinvestment Coalition (CRC) filed a Freedom of Information Act (FOIA) request with the FDIC. According to data provided to CRC, the FDIC has already paid out over one billion dollars ($1,028,404,397) to OneWest Bank. The FDIC estimates it will pay out an additional $1.4 billion to OneWest Bank before 2019. A CRC Fact sheet about the shared loss agreements is available here: OneWest Bank Shared Loss Fact Sheet.

Community leaders from a diverse group of organizations as well as affected homeowners will speak and rally tomorrow in front of OneWest’s headquarters. They will announce the new figures, call on bank regulators to hold public hearings about the proposed merger, and urge the bank leadership to implement a moratorium on foreclosing on widowed homeowners.

Kevin Stein, associate director of the California Reinvestment Coalition, comments: “Now we know why the bank CEOs refused to tell us how much they’ve received from the FDIC. This is an embarrassing amount of subsidy for the FDIC to give to the billionaire owners of this bank, especially when the bank leadership refuses to create a strong community reinvestment plan. Given this new information, the Federal Reserve must hold public hearings in Los Angeles. The community deserves an opportunity to give input on the outsized corporate subsidies, the ongoing enrichment of billionaire investors, and the lack of public benefit with this proposed merger.”

Sandy Jolley, a reverse mortgage consumer advocate who has worked with senior homeowners and their families who have been harmed by reverse mortgages, including some whose mortgages were serviced by Financial Freedom, a OneWest subsidiary. She is speaking at the press conference and adds: “It’s been a busy holiday season for OneWest Bank, with at least three different cases of the bank moving to foreclose on seniors and widows, including a 103-year-old. Today, we’re calling on the bank CEOs to stop playing Grinch and to implement a moratorium on foreclosing on widowed homeowners.”

Paulina Gonzalez, executive director at the California Reinvestment Coalition explains: “An estimated 35,000California families have been hurt by OneWest foreclosing on them during the past six years. As these middle class and working class families lose their homes, the FDIC has been writing checks to the billionaire investors who own OneWest. Is this really how it’s supposed to work?”

“The last thing California needs is yet another too-big-to-fail bank for the one percent, but that’s exactly what we’re going to get if this merger goes through as planned. Our diverse state deserves better” comments Orson Aguilar, executive director of the Greenlining Institute.

Additional Background: Representatives from the following organizations will attend the press conference and rally tomorrow:

The California Reinvestment Coalition,
Valley Economic Development Center (VEDC),
East LA Community Corporation (ELACC),
Montebello Housing Development Corporation,
Greenlining Institute,
Affordable Housing Services,
Occupy Our Homes, and
The Multi-Cultural Real Estate Alliance for Urban Change

A CIT Group/OneWest Proposed Merger Resource Page on the California Reinvestment Coalition website includes additional information about the proposed merger and why over fifty organizations are currently opposing the merger, urging the Federal Reserve and Office of the Comptroller of the Currency to hold hearings,and calling on the bank to stop foreclosing on widowed homeowners