by Matthew R. Lee, Patreon Substack
SOUTH BRONX / SDNY, Oct 11 – When First Republic Bank failed / was given to JP Morgan Chase, a small list of other regional banks came into focus as in danger. Among them was UMB - a bank whose lending Inner City Press and Fair Finance Watch had been scrutinizing, and now challenge.
UMB is asking its regulators to allow it to expand, buying Denver-based Heartland. The application, Fair Finance Watch on June 21 formally told the Fed, should not be approved. In 2022, the most recent year for which Federal data is available, UMB Bank, N.A. made over 2000 mortgage loans to whites, and only 117 loans to African Americans.
For every denial to an African American, it made only 2.02 loans. But for whites, for every denial it made 3.45 loans. It should be referred to DOJ.
There is litigation, there is also this, reported at the time of Silicon Valley Bank's failure: "UMB Bank, a regional bank headquartered in Kansas City, Missouri, and with branches across the Midwest, Southwest, and Western United States, has total assets of $38 billion and deposits totaling $32 billion, according to the FDIC. However, only 16% of deposits fall under the $250,000 FDIC insurance threshold, leaving 74.11% (equivalent to $28.36 billion) vulnerable to potential losses."
Why would regulators even consider approving its expansion? On June 21, Fair Finance Watch filed a formal Community Reinvestment Act challenge to UMB's application to the Federal Reserve, adding state by state data:
UMB Bank in 2022 in Missouri made 842 mortgage loans to whites, and only 76 loans to African Americans. Meanwhile it denied 41 applications from African Americans, and only 257 from whites.
UMB Bank in Colorado - in which it seeks to expand - in 2022 made 378 mortgage loans to whites, and only 13 loans to African Americans. Meanwhile it denied six applications from African Americans, and only 107 from whites.
UMB Bank in 2022 in Texas made 78 mortgage loans to whites, and only six loans to African Americans. Meanwhile it denied two applications from African Americans, and only 27 from whites.
These disparities cry out for a referral to DOJ, and public hearings on, and denial of, UMB's major expansion application.
On October 11 UMB's outside counsel Davis Polk sent the Fed a response but withheld branch closing, subsidiary, fintech and crypto information from Fair Finance Watch - so Inner City Press cc-ed them on a FOIA request for:
This is a formal FOIA request for the withheld exhibits to UMB's October 11 submission to the Federal Reserve in connection with its protested application to acquire Heartland Financial, in particular "Confidential" Exhibits A and B, including about fintech and branch closings and all activities engaged in by corporate subsidiaries. This is presumptively public; if any is withheld, all reasonably segregable portions should be provided.
UMB recites and responds: 1. Provide a description of the activities conducted by the following UMB subsidiaries: a. UMBCDC, Inc., Kansas City, Missouri; b. UMB Financial Services, Inc., Kansas City, Missouri; c. UMB Management Equity Holdings Inc., Kansas City, Missouri; d. UMB Merchant LLC, Kansas City, Missouri; and e. UMB Asset Management, LLC, Kansas City, Missouri The requested information is included in AIR Confidential Exhibit A. Convenience and Needs 2. Provide an update on UMB Bank’s branch consolidation analysis and confirm whether any of the branches listed in Public Exhibit 3 of the Additional Information Response, dated August 5, 2024 (“August AI Response”) would be consolidated, following consummation of the proposed transaction. The requested information is included in AIR Confidential Exhibit B. Discuss any plans to engage in crypto-asset-related activities or fintech partnerships. The requested information is included in AIR Confidential Exhibit A.
Again, this is both important for the public to know and is presumptively public; if any is withheld, all reasonably segregable portions should be provided.
Watch this site.
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