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Federal Reserve Board: Merger Process Needs Guidelines for Community Reinvestment Issues

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Report Type Reports and Testimonies
Report Date Sept. 24, 1999
Report No. GGD-99-180
Subject
Summary:

This report discusses the mergers of large bank holding companies and their impact on lending in low- and moderate-income neighborhoods. In reviewing such merger applications, the Federal Reserve Board must take into account an institution's record of community credit performance. Also, the Fed must take into account the convenience and needs of the community to be served when reviewing merger applications of bank holding companies. This report analyzes (1) the Fed's legal responsibilities in assessing mergers of bank holding companies for performance under the Community Reinvestment Act of 1977; (2) the Fed's process for assessing the performance of six large bank holding company merger applicants, including how the Fed addressed the principal public concerns related to performance under the Act; and (3) the premerger and postmerger mortgage lending in poorer neighborhoods and minority communities for three larger mergers of bank holding companies.

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