by Matthew R. Lee, Patreon Substack
SOUTH BRONX / SDNY, Dec 13 – When First Republic Bank failed / was given to JP Morgan Chase, a small list of other regional banks came into focus as in danger, banks whose lending Inner City Press and Fair Finance Watch had been scrutinizing, even more so that the 2023 data is out.
This week Inner City Press filed with the Fed, a timely first comment on, the Applications of SouthState Corporation to merge with Independent Bank Group, Inc., and Independent Bank.
SouthState in South Carolina in 2023 - data not yet included in any CRA exam - made 5013 mortgage loans to whites, and only 228 loans to African Americans. Meanwhile it denied only 670 applications from whites, and fully 195 from African Americans. SouthState should be referred to DOJ.
SouthState in North Carolina in 2023 - data not yet included in any CRA exam - made 1334 mortgage loans to whites, and only FIFTY SEVEN loans to African Americans. Meanwhile it denied only 173 applications from whites, and fully 20 from African Americans.
SouthState in Georgia in 2023 - data not yet included in any CRA exam - made 1176 mortgage loans to whites, and only 318 loans to African Americans. Meanwhile it denied only 304 applications from whites, and fully 88 from African Americans.
Nationwide in 2023, SouthState made 7798 mortgage loans to whites, and only 947 loans to African Americans. Meanwhile it denied only 2491 applications from whites, and fully 558 from African Americans.
Why would regulators even consider approving its expansion?
On August 9, SouthState submitted to the Fed a response - that deals only with Independent Bank.
On September 18, the Fed asked SouthState questions including "Confirm that no consumer products or community development programs or services offered by either organization will be discontinued by the combined organization as a result of the proposed transaction, other than those identified in Confidential Exhibit 18 to the application."
Inner City Press has submitted a FOIA request with the Fed for that obviously CRA-material Exhibits.
No thanks to the Fed, Inner City Press got the exhibit - SouthState just withdrew its request for confidential treatment, of this: "CONFIDENTIAL SouthState Bank, N.A. Independent Bank Discontinued Independent Bank Products and Services June 2024 SSC and IBTX currently plan on discontinuing Independent Bank’s mortgage warehouse program and selling its Shared National Credits (SNC) portfolio. Almost all purchased SNCs are in Independent Bank’s commercial loan portfolio, with the largest single industry concentration in energy."
But there is more being withheld. SouthState filed on September 30: "Please see Confidential Exhibit 1 to the Confidential Appendix for additional information on branch actions SouthState may plan to take that are unrelated to the proposed transaction."
On December 13 the Fed rubber stamped the deal, even as it admitted it is order poor performance in South Carolina and poor geographic distribution of SouthState's loans in North Carolina. This is today's Fed.
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