City National Ignores Communities

City National, California’s 10th largest bank with $12 billion in deposits, made a CRA commitment to the California Reinvestment Coalition and California communities during its acquisition of Civic BanCorp of Oakland in 2000.   In the last six years, the Bank has neglected this commitment and the needs of California communities.  Therefore, CRC is opposing City National Bank’s planned purchase of Business Bank of Las Vegas and has called for hearings by the Office of the Comptroller of the Currency in Los Angeles.

City National has not honored its commitment.  For example, the Bank committed to move from 10 to 20 percent of its deposits for CRA and, after five years of the commitment, has fallen backward to 11 percent from nearly 16 percent in 2001.  It committed one percent of its net income to contributions and has fallen below that since 2002.  And the Bank’s small business lending has dropped from 2001 to 2005.
   
Its “community” lending includes the following:           
●    In California, 11 Asian Americans, five African Americans, and 14 Latinos received home mortgage  loans out of a total of 574 loans.  Only nine low or moderate income people received loans. 
●    In Los Angeles, seven Asian Americans, five African Americans, and eight Latinos received home mortgage loans out of a total of 348 loans.  Only three low or moderate income people received loans. 
●    Of the 20 SBA loans made in the 2006 federal fiscal year, none were made to African American business owners, only two were made to Latino business owners and three to Asian Americans.
●    Conventional small business lending to businesses in lower income neighborhoods in the headquarter city of Los Angeles in 2005 was far below the proportion of either small or very small businesses with great credit needs.  In CRC’s soon-to-be published report on California small business lending, City National received zero out of a possible score of three points.
●    Only six of 27 branches in the headquarter city of Los Angeles are in LMI areas.

CRC members do not see City National Bank responding to community needs in terms of lending, investments or services.  Despite the size of the Bank in California, most CRC members have had no contact with it although they are the leading community-based organizations in California.  It is unclear to CRC why the regulators would approve this acquisition with the current record of the Bank.