Advocates drop opposition to Jefferson Bank merger after First Mid inks a community benefits agreement
Last fall, members of the St. Louis Equal Housing and Community Reinvestment Alliance and other advocates publicly opposed plans by Illinois-based First Mid Bank & Trust to purchase Jefferson Bank & Trust, a site of major civil rights protests in 1960s St. Louis. Mortgage-lending data for First Mid Bank showed “significant and widespread redlining and fair lending concerns,” the advocacy groups said. They urged the Federal Reserve to deny the merger and open an investigation into First Mid’s practices.
But a lot can change in a few months. And on Jan. 11, the community advocates announced they had reached a community benefits agreement with First Mid. The three-year agreement includes a plan to open at least two new First Mid branches that will serve low-to-moderate-income and minority communities — one in St. Louis and the other in Champaign, Illinois — as well as target lending goals and personnel investments by the bank.
“I’m really happy with how this has evolved,” said Elisabeth Risch, the alliance’s co-chair and also assistant director of the Metropolitan St. Louis Equal Housing and Opportunity Council. “The agreement is pretty significant. It includes a lot of the commitments that our members were looking for and asking for, and I think what that represents is really the bank’s and our ongoing dialogue.”
First Mid also committed to commemorating Jefferson Bank’s prominence in the civil rights struggle in St. Louis with a $10,000 donation tothe Griot Museum of Black History, according to a release.
In a statement, First Mid Chairman and CEO Joe Dively called the dialogue with advocacy groups productive. He said the bank is “optimistic the CBA will serve as a road map for our broader engagement with the community and like-minded organizations.”
As to the promised new locations, Dively said in a statement that First Mid is “investigating opportunities to best meet the needs in these communities and [has] already begun exploring potential sites.”
“We are also open to a non ‘traditional branch’ in order to meet these needs, which could include co-locating with trusted community partners, such as libraries, churches and community centers,” Dively said.
But while Risch said the agreement represents significant progress, she said cooperation with First Mid isn’t nearly enough when it comes to larger issues within the financial sector.
“Our issue is also with the Federal Reserve and with the other banking regulators … the regulators who oversee how banks are meeting their obligations in the community and complying with fair housing and fair lending laws,” Risch said, noting that regulators gave First Mid solid ratings despite its poor record serving people of color. “And so we still see the need to really raise the standards for how those regulators are evaluating banks.”
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