SDNY COURTHOUSE, October 30 –
EverBank and WaFd (Washington Federal) Bank announced a
reverse merger on Labor Day, proposing a combined bank in
FL, NY, AZ, CA, ID, NV, NM, OR, TX, UT and, of course,
Washington.
In that state, WaFd in 2025 made 65
mortgage loans to whites and only ONE to an African
American applicant. In Arizona it made 13 loans to whites,
NONE to African Americans.
That is disparate, and has now been raised
by Fair Finance Watch in timely comments in opposition
filed with the Federal Reserve Board and Office of the
Comptroller.
On October 14, after the Federal Reserve
has confirmed the application will go to the Board in
Washington, Inner City Press / Fair Finance Watch has
filed FOIA requests for the parts of the EverBank / WaFd
application that the banks and regulators are keeping out
of sight. The application EverBank filed with the Office
of the Comptroller of the Currency on October 3 comes in
two volumes, public and confidential, and the lawyers at
Wachtell Lipton ask that the confidential one, Exhibits A
through L, be withheld under FOIA Exemptions 4, 6 and 8,
saying it would cause “substantial and irreparable harm.â€
What is in it? The pro forma financials and capital
ratios, due diligence, the “integration approach and
timeline,†EFC’s risk management program, the disclosure
schedules to the merger agreement, the shareholders of the
privately held EverBank Financial Corp, and its directors
and officers. That is a lot to call secret, when the
combined bank would be $73.8 billion in assets, and with
WaFd Bank’s own lending record (65 loans to white
applicants in Washington in 2025, one to an African
American) under question. We have asked the OCC for all of
it, with expedited processing and a fee waiver, on the
ground that the public cannot comment on what it cannot
see.
The Federal Reserve is the other half. The
OCC application says a separate application went to the
Fed and that the parties would provide the Fed a copy of
the OCC filing. The Fed, through a FRBSF staffer, told us
it would send us the application; so far, it has not given
Fair Finance Watch any of it. (We note this because the
comment period sure is running). So we have filed a
FOIA request with the Board, based on the OCC application,
for the Fed application and for the withheld exhibits as
the Fed holds them. We will publish what we get.
From WaFd's CRA Performance Evaluation from
the FDIC:
On Phoenix-Mesa-Chandler, Arizona
MSA: "The relatively high level of community
development loans compensated for the poor geographic
distribution and very poor borrower profile performance in
this MSA... The distribution of borrowers reflects very
poor penetration among retail customers of different
income levels and business customers of different sizes.
This conclusion results from a distribution of home
mortgage borrowers that reflects very poor penetration
among retail customers of different income levels, and a
distribution of small business borrowers that reflects
poor penetration among business customers of different
sizes."
On moderate-income geographies;: "The
bank's level of lending in moderate-income geographies
lagged aggregate lenders as well as opportunities as
defined by the percentage of families considered
moderate-income in the assessment area, that performance
is considered very poor."
So why would this proposed merger be
approved? FFW has filed opposition.
On October 30 the Federal Reserve Bank of
San Francisco sent WaFd an Additional Information request
on the EverBank deal. It has 13 numbered items. Item
3 asks WaFd to list the overlapping branches that “might
be considered for closure or consolidation†and to say
which are in low- or moderate-income, majority-minority,
or distressed or underserved nonmetropolitan middle-income
tracts, and to give the criteria for choosing which branch
closes. It also asks what the “other business reasons†for
closures would be. Item 1 asks for a “more detailed
anticipated timeline†for applying EverBank’s fair lending
and UDAP-UDAAP programs to WaFd Bank, which the
application had promised would happen “over time.†Items 2
and 4 ask what WaFd’s review of the two CRA programs has
found, whether the combined bank will actually use
EverBank’s CRA program, and whether the Fresh Start
Account and secured credit card will be offered to all
customers. These are the questions Fair Finance Watch
raised in its comments on WaFd’s lending in Washington and
Arizona and its poor CRA ratings in the
Phoenix-Mesa-Chandler MSA. The Fed is now asking WaFd for
the specifics, which suggests the application did not
supply them. The rest of the letter is about
structure and risk. Item 9 asks WaFd to compare its
commercial real estate business with EverBank’s and to
explain how management would “mitigate CRE portfolio
concerns for the combined institution.†Items 10 through
13 are about the Merger Agreement dated September 6, 2026
and the form of Shareholders Agreement attached as its
Exhibit F. The Fed asks how Section 6.9(b) of the Merger
Agreement complies with section 18(k) of the FDI Act, 12
U.S.C. § 1828(k), and 12 C.F.R. part 359 (the golden
parachute rules). It says the Shareholders Agreement has
no 25-year termination, as Board precedent expects to keep
it from being treated as a “company†under the BHC Act. It
asks whether sections 4.1 and 4.3 of that agreement are
limiting contractual rights under 12 C.F.R. §
225.31(e)(5)(i)(I) and would create a presumption of
control for any investor. In other words, the Fed is
asking whether investors in the deal would end up
controlling WaFd without being treated as controlling it.
Items 5 through 8 ask about EverBank
shareholders’ business relationships with the combined
company, Mangrove Cell 79 Protected Cell and Mangrove
Insurance Solutions, PCC (including the terms of the
non-voting preferred shares EverBank Financial Corp.
holds), what WaFd Insurance Group, Inc. does and under
what authority the combined company would control it, and
a copy of the filing made to the Texas Department of
Insurance. Letter on Patreon here.
The letter sets a deadline of eight
business days, with the response to be posted to
FedEZFile #116444. The public portion of that
response must be sent “directly to the commenter,†and
confidential material must be separately bound under 12
C.F.R. § 261.17. So Fair Finance Watch will see WaFd’s
answers on branches, CRA and fair lending, but not
whatever WaFd marks confidential. That is the same
withholding at issue in our pending FOIA requests, and the
Fed’s own questions about the shareholders agreement, the
insurance cells and the Texas filing show how much of the
transaction is not in the public record. The comment
period should be extended and reopened once the public
responses arrive.
