ANHD CRA / Bank Advocacy Work OrganizeOhio! Fair Lending Conference Jaime Weisberg, Senior Campaign Analyst ANHD November 13, 2015

The Association for Neighborhood and Housing Development ANHD represents over 100 local Community Development Corporations (CDCs) and other neighborhood based organizations focused on affordable housing, equitable economic development ANHD was founded in 1974 with the mission to help low-income communities thrive and to ensure that all New Yorkers can live in decent, affordable housing and neighborhoods. ANHD members came together at a time of major disinvestment and redlining in NYC and urban communities nationwide. – ANHD was part of the movement to pass the CRA. The focus then was to “Fill in the holes” – build housing, get banks to open and lend, and bring banks to the table as partners. Over the past 30 years, ANHD has been a leading voice for affordable housing in NYC and ANHD members have built over 100,000 units of housing. ANHD Current Focus: Building and Preserving Affordable Housing, Expanding equitable economic development, and increasing the quantity and quality of Bank Reinvestment in NYC

Original Policy Research to engage ANHD members and influence policy makers and regulators Training and Capacity Building to support developers and community / tenant organizers. – Training and technical support for CDC developers – Capacity building training, policy research, and technical support for organizers – Training for the next generation of organizers and planners through apprenticeship programs, advanced organizer trainings, and graduate fellowships Grassroots Campaigns to achieve policy change – legislative, regulatory, and other The Association for Neighborhood and Housing Development

Preserving private multifamily affordable housing: * 2/3 of New Yorkers are renters; nearly half are rent-regulated * 56% renters are rent-burdened; 30% severely rent-burdened o Preserving rent-regulated buildings & units; credit for loans to purchase, refinance, and maintain multifamily housing. o Finance responsible landlords that will maintain the buildings and respect tenant rights. Banks to help transfer properties to responsible owners when the landlord does not meet that criteria. Why NYC Cares About CRA Access to Credit: affordable home loans, small business loans, education and small dollar loans; secured credit cards and loans to build/repair credit Access to Banking: branches, affordable accounts, transparent fees, language access and flexible ID requirements, hours, access Elimination of predatory products, such as payday lending and high cost credit cards, personal, and prepaid cards

o Community Development Loans, Investments and Grants: o Build and preserve real affordable housing o Create and preserve quality Jobs for underserved communities o Support small businesses o Build and maintain community facilities: community centers, healthcare, schools, access to quality food o Support community-based nonprofits: general operating support, community organizing, housing counseling, small business supports, workforce development, and more Why NYC Cares About CRA

ANHD’s CRA & Bank Work Research reports, including – Annual State of Bank Reinvestment in NYC report – Detailed research on bank reinvestment and economic development Participation at time of CRA exams Bank Merger / Acquisition advocacy Regulatory advocacy – HMDA modernization, CRA Q&A’s, and other regulatory changes Member support to engage with banks on an ongoing basis: Tenant & community organizers and developers

Annual report of CRA Activity and bank reinvestment in NYC, with detailed analysis of 25 commercial, savings, and wholesale banks operating in NYC State of Bank Reinvestment in NYC Includes Industry Trends, Analysis, and Recommendations on major areas of Bank Reinvestment: Deposits Branching Patterns & Bank Accounts Core Lending: Multifamily, 1-4 Family, and Small Business lending Community Development Activity: Staff, Community Development Lending, CRA-Qualified Investments, and Philanthropy / CRA- Eligible Grants

Bank Reinvest- ment % Chg $'s Overall Reinv. Index % Chg Index Largest Banks (Greater than $50 B assets) M&T Bank$293  7%11.00%  -2% Wells Fargo$1,181  86%8.90%  70% Capital One$696  -32%3.00%  -34% Citibank$1,319  32%2.30%  20% Bank of America$378  38%0.80%  38% HSBC$389  -25%0.70%  -28% TD Bank$78.82  -60%0.60%  -63% Santander$37.69  20%0.50%  13% Chase$1,270  22%0.30%  13% Smaller Banks (Fewer than $50 B Assets) NY Community$2,945  56%50.80%  41% Carver$46.14  34%9.40%  42% Signature$1,030  13%9.00%  -4% Dime$126  -36%6.38%  -41% Astoria$204  -49%5.56%  -48% Ridgewood$109  231%4.00%  214% Valley National$61.64  202%3.85%  202% Flushing*$32.46  -8%2.70%  -3% Popular Community$64.16  -38%2.60%  -35% Apple$114  77%1.70%  14% Emigrant$10.92  9%1.30%  310% Wholesale Morgan Stanley$123  -18%0.90%  -37% Deutsche Bank$17  16%0.60%  -11% Goldman Sachs$257  -17%0.40%  -31% BNY Mellon$261  -59%0.20%  -60% 2013 Overall Reinvestment Volume Index: Measures volume of reinvestment loans and investments to locally held deposits

2013 Overall Reinvestment Quality Score: Measures how loans, investments, and services reach lower-income residents and neighborhoods Largest BanksSmaller Banks Capital One3.64Popular Comm.4.33 Chase3.37Carver3.89 M&T3.33NY Community3.23 Bank of America3.32Apple3.08 HSBC2.94Ridgewood2.89 Citibank2.72Signature2.5 TD Bank2.58Dime2.3 Wells Fargo2.34Astoria2.26 Santander2.27Valley National2.08 WholesaleEmigrant1.5 Deutsche Bank3.59Flushing1.37 Morgan Stanley3.19 Goldman Sachs3.14 BNY Mellon1.5

CRA Exams – Submit comments on CRA exams – Speak to regulators about community needs – Educate bank leadership on community needs Comments and advocacy at the time of mergers – Recent past mergers: BankUnited-Herald, Valley National-1 st United – Current: Goldman Sachs, NY Community Bank ANHD Believes that no merger or acquisition should be approved without a CRA Plan Participation in the CRA process

New Jersey Based bank with 31 branches in NYC In 2014, Valley National Applied to acquire Florida-based 1 st United Bank ANHD, NJ Citizens Action and NCRC contested the merger: – in 2012 only 1.5% of all Valley National home loans in NYC and Northern New Jersey went to African-American borrowers even though African-Americans make up 20.5% of the population. – In NYC, not one home purchase loan in 2012 went to an African American or Latino borrower and few of their loans overall went to LMI borrowers and neighborhoods. – Just one of their 102 NYC multifamily loans in 2011 and 2012 was in a low- or moderate-income tract. – Additionally, the bank had not made one CRA-qualified investment, including grants, in NYC in the prior 3 years. – In the bank’s 2013 CRA exam by the OCC, examiners used the word "poor" or "very poor" 47 times to describe the bank's lending performance. We submitted comment letters, spoke with regulators, and met with the bank’s CEO and senior staff Valley National Example

In late 2014, the OCC granted a “conditional approval” that required a CRA Plan that is to be public and enforced by the OCC Highlights of the plan: – Institutional Support by the CEO, board, and senior staff – First time home buyer program, with $30 million allocated in support – Small business lending unit to concentrate on smaller loans – Ambitious, measurable goals to finance multifamily apartments in LMI tracts and to reach LMI borrowers and borrowers of color with home and small business loans. – Increase in grant budget and increases in Community development lending and investments, particularly for affordable housing and economic development Valley National Example

History Based in NY. Through multiple acquisitions, it now operates in 5 states: New York, Florida, Arizona, Ohio, New Jersey Long been one of the largest multifamily lenders in NYC In the early-mid 2000’s, ANHD members raised concerns about NYCB’s lending practices: – Overleveraging: putting too much debt on the buildings – more than the buildings could sustain given the rents and expenses – Lending to unscrupulous landlords who harassed tenants and didn’t maintain the buildings in good condition – When the economy collapsed, loans defaulted, buildings fell into foreclosure, and conditions worsened – When ANHD commented to the FDIC in 2011, over 19,000 units, nearly 14% of NYCB’s portfolio, were in distress We used all tactics: protests, rallies, meetings with the bank, comments for CRA exam, meetings with regulators New York Community Bank (NYCB) Example

Organizing got results from the bank: – Came to the table and committed to improving its practices – Participates in the First Look program – a program designed by ANHD, City Council, and allies to transfer distressed buildings to preservation-minded developers NYCB was the first bank to work through the program to transfer a very distressed building in the Bronx to a community-minded developer – New York Community Bank (NYCB) Example

Current NYCB Merger #1: Internal merger of NY Community Bank and NY Commercial Bank NYCB Merger #2: NYCB to purchase Astoria Bank New York Community Bank (NYCB) Example

Current ANHD submitted comments on the internal merger and will do so for the Astoria merger NYCB remains the largest lender in the city – conditions in their buildings appear much better than they were in and we very much appreciate the responsiveness of NYCB staff since that time. – 3,991 buildings in portfolio (over 180,000 units) – only 10 “at risk” of physical and financial distress However, signs of overleveraging do not necessarily appear in these indicators, especially when a bad- actor landlord successfully moves out lower-rent paying tenants through harassment and eviction tactics. We are concerned by some of the landlords NYCB has loaned to in recent years. New York Community Bank (NYCB) Example

Current NYCB has about $49 billion in assets – the Astoria merger will push it over the $50 billion mark, making it one of the larger banks in the city. All banks, especially those of this size, must demonstrate a proactive commitment to CRA. A thoughtful comprehensive CRA plan – developed in partnership with the local communities it serves – is the best way to demonstrate this commitment: – concrete, measurable goals to benefit lower-income communities and communities of color with banking products, core lending, and CRA dollars – Dedicated, empowered staff with adequate resources – Strong partnerships with the nonprofit community and a commitment to support nonprofit developers New York Community Bank (NYCB) Example