LOS ANGELES (July 22, 2014) — Community leaders are gathering at a Los Angeles Banco Popular branch to speak out against the proposed sale of 20 Banco Popular branches.
On July 11, the California Reinvestment Coalition wrote to the Office of the Comptroller of the Currency, (the bank regulator that would approve the acquisition of the branches), opposing Banc of California’s acquisition and citing concerns that the proposed notice was only posted in the New York Times and Orange County Register where community members may not have seen it. As a result, on July 17, the OCC instructed Banc of California to file a second notice of the proposed acquisition in the Los Angeles Times and La Opinión.
The OCC also extended the comment period by 30 days, giving the community until August 19 to provide input. According to Fortune, the largest banks in the U.S. have increased in size 37% since 2008.
Leaders are concerned about the impact on the community if the acquisition is approved by the Office of the Comptroller of the Currency, (OCC) a bank regulator. Banc of California, headquartered in Irvine, is trying to acquire the 20 branches, (located in Los Angeles and Orange Counties), but refuses to provide information to the bank regulator or local community about the bank’s plan for the branches or how the bank will meet requirements under the federal Community Reinvestment Act. Leaders are calling on the OCC to deny the acquisition until the bank provides a public community reinvestment plan that outlines the bank’s goals related to philanthropy, small business lending, community development, consumer accounts, and more.
“We’re speaking out today because we’re worried about what will happen to the customers and communities who currently rely on these twenty branches,” said Hyepin Im, president and CEO of Korean Churches for Community Development. The OCC should either postpone or not approve this acquisition because right now it doesn’t have enough information to evaluate whether or not there’s a community benefit to this acquisition.”
“The customers who rely on Banco Popular deserve answers from Banc of California before any transaction moves forward,” said Maria Cabildo, president of the East LA Community Corporation. “Banc of California has traditionally focused on affluent customers in Orange County, so this is a new market for them. To build trust with new customers, the bank needs to be transparent in its plans.”
“We’re here today because we all work with consumers and small businesses where these branches are located,” said Michael Banner, president and CEO of the LA Local Development Corporation. “Communities thrive when there is access to small business loans, philanthropy, and community development investments by banks. Unfortunately, the bank won’t tell us its plans in any of these areas, so we’re asking the OCC to step in.”
Bishop Juan Carlos Mendez of CLUE- LA and founder of Churches for Action highlights the need for creating trust.
“Our neighborhoods have suffered greatly thanks to the Wall Street created recession,” said Juan Carlos. “People have legitimate concerns when they hear that their local branch is being bought by a bank in Irvine. If the bank truly values these customers then it should start meeting with the community and be transparent with its plans.”
Paulina Gonzalez, executive director of the California Reinvestment Coalition, an umbrella organization with over 300 organizational members throughout the state, explains: “The CEO of Banc of California, Steve Sugarman, has decided that the Community Reinvestment Act doesn’t apply to him or his bank. While other large banks develop their CRA plans with input from the community, Banc of California won’t. And while other large banks make their community reinvestment goals public, Banc of California won’t. The FDIC and the Federal Reserve have both required this type of transparency in recent bank mergers and acquisitions, and we expect no less from the Office of the Comptroller of the Currency.”