Saturday, September 5, 2015

Pa. bank's NY deal at risk as US checks bias

Can Jay Sidhu's Customers Bank complete its Community Bank deal while facing a Justice Dept. fair-housing review?

Pa. bank's NY deal at risk as US checks bias

0 comments
Customers Bank
Customers Bank

Do Philly-area banks discriminate against black and poor people who want to borrow money to buy homes?

Customers Bancorp Inc. faces a Justice Department review of possible violations of the Fair Housing Act and other mortgage discrimination rules after an initial Federal Reserve Bank of Philadelphia review found potential violations of loan discrimination laws.

That means former Sovereign Bank boss Jay Sidhu's fast-growing, Wyomissing-based lender will run up "higher legal costs" and will "spend more time addressing the issue" instead of "growing the bank;" also "Customers' pending acquisition of CMS Bancorp Inc., (White Plains, N.Y.) is in jeopardy of not receiving regulatory approval, and falling through," warns analyst Matthew Schultheis, of Boenning & Scattergood, West Conshohocken, in a report to clients.

Customers last week announced a loan office in largely African American North Philly, as if to prove it will lend to anyone with good credit. Sidhu previously pledged to target working-class neighborhoods -- West Philly, Germantown, Northeast Philly -- which he says have been left behind by American banks' rush to finance wealthy people's projects.

Beneficial Bank, the largest bank still based in Phlladelphia, faces a similar review that may have the effect of preventing the bank from being acquired and giving it time to prepare for renewed growth, as it works out its damaged loans.

0 comments
We encourage respectful comments but reserve the right to delete anything that doesn't contribute to an engaging dialogue.
Help us moderate this thread by flagging comments that violate our guidelines.

Comment policy:

Philly.com comments are intended to be civil, friendly conversations. Please treat other participants with respect and in a way that you would want to be treated. You are responsible for what you say. And please, stay on topic. If you see an objectionable post, please report it to us using the "Report Abuse" option.

Please note that comments are monitored by Philly.com staff. We reserve the right at all times to remove any information or materials that are unlawful, threatening, abusive, libelous, defamatory, obscene, vulgar, pornographic, profane, indecent or otherwise objectionable. Personal attacks, especially on other participants, are not permitted. We reserve the right to permanently block any user who violates these terms and conditions.

Additionally comments that are long, have multiple paragraph breaks, include code, or include hyperlinks may not be posted.

Read 0 comments
 
comments powered by Disqus
About this blog

PhillyDeals posts drafts, transcripts and updates of Joseph N. DiStefano's columns and stories about Philly-area business, which he's been writing since 1989.

DiStefano studied economics, history and a little engineering at Penn and taught writing at St. Joseph's. He has written thousands of columns and articles for the Inquirer, Bloomberg and other media, wrote the book Comcasted, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com, distefano251@gmail.com, 215.854.5194 or 302.652.2004.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
Also on Philly.com:
letter icon Newsletter