After OceanFirst Flushing Hit by Fair Finance Watch Fed Withholds Warburg Pincus Rubber Stamps

After OceanFirst Flushing Hit by Fair Finance Watch Fed Withholds Warburg Pincus Rubber Stamps by Matthew Russell Lee, Patreon Book Substack FEDERAL COURT, April 24 – How automatic do bank now think merger approvals are? On December 29, OceanFirst, which settled charges of redlining earlier this decade, announced it will apply to buy Flushing Bank in New York.    Fair Finance Watch has opposed it, in comments filed January 2 with the Office of teh Comptroller of the Currency, and with the Federal Reserve Board which recently allowed a $7 billion mega-merger to proceed with no Fed review. OceanFirst's record should preclude this. and this proposed deal.    In 2024 OceanFirst made 1399 loans to whites - and only 94 to African Americans. In Connecticut, for example, it made loans only to whites, none to African Americans.    In Pennsylvania its ratio of loans to whites to loans to African Americans was 4.5 to 1. In New York, it was 7 to 1. This proposal is being opposed along with the OCC's moves to exclude the public, and to withhold documents under FOIA from Inner City Press and others until comment periods close. On February 17 the Fed asked OceanFirst 17 questions, including   "Discuss in greater detail the due diligence conducted by OceanFirst related to Flushing Bank’s Community Reinvestment Act (“CRA”) program and how OceanFirst will ensure compliance with Community Reinvestment Act requirements post-acquisition.Todd Schell of Warburg Pincus (“WP”) needs to submit an IBFR for purposes of processing the instant application" - filing on Patreon here On March 5, the FRB of Philly, not the bank, sent out OceanFirst's response - and it was heavily redacted, including response on CRA. So, an immediate FOIA request, for response / responsive documents within the comment period. On March 19, with still no documents despite the Fed granting "expedited" processing, the Fed asked OceanFirst: "1. OceanFirst notes that certain funds associated with Warburg Pincus would invest $225 million of cash capital in OceanFirst in exchange for newly issued shares of voting common shares, non-voting common equivalent shares, and warrants. Provide evidence of the $225 million in hand or in escrow or similar account. 2. OceanFirst notes that Warburg Pincus funds currently have investment in the following bank holding companies (“BHCs”): Banc of California, Inc., Los Angeles, California; EverBank Financial Corp, Jacksonville, Florida; and Varo Money, Inc., San Francisco, California. Indicate whether Warburg Pincus funds hold five percent or more in these BHCs or other entities. If so, provide the ownership percentage in each of these entities." But on March 27 OceanFirst through counsel wrote in, "Confidential information regarding the ownership percentages of the WP Investor in the identified institutions is provided at Volume K, Exhibit 40." Inner City Press immediately submitted a FOIA request to the Fed. On April 3, still with no substantive response from the Fed, the FRB of Philadelphia forwarded its third Additional Information letter to OceanFirst - with all of the questions withheld. A FOIA request was immediately filed. And on April 13 the Board said it granted Inner City Press' challenge to the Reserve Bank's wrongful withholding of its own question But on April 24, the Board rubber stamped the redlining deal, now dismissing comments on Warburg Pincus while withhold info: "One of the adverse comments the Board received on the proposal, discussed further below, observed that certain funds controlled by Warburg Pincus LLC (“Warburg”), New York, New York, would make investments in OceanFirst as part of the proposal. The commenter asserted, without offering support or analysis, that (i) the Board should take into account Warburg’s involvement in the proposal, and (ii) Warburg should be required to file applications with the Board under section 3 of the BHC Act in connection with the transaction. Wholly unsubstantiated claims generally are not considered to be substantive comments and, thus generally are not considered by the Board in its evaluation of the statutory factors governing the transaction.... Regardless, the Board considered the impact of the investments by the funds controlled by Warburg as part of the proposed transaction when considering the financial and managerial resources and future prospects factors under the BHC Act." This new "substantive" language, with the Fed applies even to the CFPB complaint database is called by some the "Bowmanization" of the Fed. Sullivan & Cromwell gleefully uses it, even as it uses AI. And so it goes...   Note: the above was written and published before the Board's 4:45 pm phone call -- Inner City Press answered and said it knew the script. Strange system: the Board bounced / did not accept comments by email, but insists on phone call notice, hours after announcing the approval to the market. The changes at the Fed, the shrill language about "substantive," is a step back. Watch this site. *** Your support means a lot. As little as $5 a month helps keep us going and grants you access to exclusive bonus material on our Patreon page. Click here to become a patron. Feedback: Editorial [at] innercitypress.com SDNY Press Room 500 Pearl Street, NY NY 10007 USA Mail: Box 130222, Chinatown Station, NY NY 10013 Reporter's mobile (and weekends): 718-716-3540 Other, earlier Inner City Press are listed here, and some are available in the ProQuest service, and now on Lexis-Nexis.  Copyright 2006-2026 Inner City Press, Inc. 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