Steelworkers' Report on Wells Fargo Community Lending Practices Gets Results
Following Pressure by Steelworkers and Community Groups, Federal Reserve Schedules Public Hearing on September 17 in Minneapolis On Pending Merger Between Wells Fargo Bank & Norwest
PITTSBURGH, Sept. 4 /PRNewswire/ -- The potent combination of a report from the Steelworkers union raising doubts about Wells Fargo Bank's adequacy in meeting the credit and service needs of low and moderate income families and minority communities and pressure from dozens of community groups nationwide raising similar concerns appear to have forced the Federal Reserve to schedule a public hearing on Wells' proposed merger with Norwest Bank.
"It is gratifying that a community-labor coalition can influence the regulatory process and force two large corporations to be responsive to the needs of working families," said Steelworkers President George Becker.
In announcing the September 17 hearing in Minneapolis, the Fed cited the need to examine "the convenience and needs of the communities to be served," including "the records of performance of Norwest and Wells Fargo under the Community Reinvestment Act." The CRA encourages banks and thrift institutions to help meet the credit needs of their entire communities, including low and moderate income neighborhoods, consistent with safe and sound lending practices.
The Steelworkers' report, Shortchanging Our Neighborhoods: A Study of the Recent Community Lending Performance of Wells Fargo, was released less than two weeks before the Fed announced the public hearing. The report says Wells Fargo's performance since its 1996 merger with First Interstate Bancorp "provides troubling evidence of (a) lack of commitment to low and middle income families and minority communities." It adds that this evidence is "of particular concern" in light of the proposed merger of Wells Fargo and Norwest, which would create the country's largest originator of home mortgages and its seventh largest bank, with $191 billion in assets and branches in 21 states.
The Fed's announcement said it also must determine whether "proposed non-banking activities can reasonably be expected to produce benefits to the public that outweigh possible adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interest or unsound banking practices."
When the Steelworkers released their report, Becker called on the Fed to thoroughly investigate and hold public hearings on Wells Fargo's community lending performance, prior to approving the merger with Norwest.
In addition to its questionable lending practices, Wells is chief financial backer for Oregon Steel's war on workers at its CF&I plant in Pueblo, CO, where 1,000 Steelworkers have been unlawfully denied reinstatement to their jobs since December 30, when the union ended a three-month strike.
The Federal Reserve Board's public hearing on the Wells Fargo/Norwest merger will be September 17 at 9 a.m. CDT at the Federal Reserve Bank of Minneapolis, 90 Hennepin Ave., Minneapolis, MN.
SOURCE United Steelworkers of America
CO: United Steelworkers of America; Wells Fargo Bank; Norwest
ST: Pennsylvania, Minnesota
IN: FIN MNG
SU: EXE LBR TNM
09/04/98 12:55 EDT prnewswire.com |
