Two federal agencies have required Union Planters Corp. to identify all the branches it would close after it bought a Memphis thrift.
Community activists and banking lawyers said the decision by the Office of Thrift Supervision and the Federal Reserve Board to require the disclosure could affect future merger applications.
"This is groundbreaking," said Francis Grady, a partner at the Washington law firm of Grady & Associates in Cleveland. "It is the first time a regulatory agency is saying, 'Report to us all of the branches you plan to close within the next 12 months.' This is a seminal development."
But Warren Traiger, a New York lawyer who specializes in Community Reinvestment Act issues, said it's too early to tell whether regulators will routinely require branch-closing data.
"It's not earth-shattering," Mr. Traiger said.
Community activists have tried for years to learn before a merger is approved which branches will be closed. They hope to use this information to prove the bank does not meet the convenience and needs of its community. The agencies, however, have largely rebuffed their pleas.
For example, community activists tried last winter to learn which branches Wells Fargo & Co. planned to close before the Fed approved its merger with First Interstate Bancorp. But the agency did not require the bank to turn over that information.
Activists also sought a list last fall of all the branches that would be closed after Chase Manhattan Corp. and Chemical Banking Corp. merged. This spring the Fed accidentally disclosed the data, forcing it to seek a court order requiring the community group to return the list.
But OTS' Chicago office told Union Planters in a June 12 letter that it wanted the locations of all branches to be closed. The Fed also requested the branch closing information in a June 25 letter. Union Planters publicly released its branch closing information on June 28.
OTS officials downplayed the significance of the disclosure. The agency's regional offices have the discretion to ask for a variety of information during the application process, said Larry Clark, the agency's manager of compliance and trust programs.
Union Planters officials said they were going to make the information public anyway. Fed officials declined to comment.
But community activists were thrilled.
"To my knowledge this has not happened before anywhere in the country," said Hubert Van Tol, executive director, Mid-South Peace and Justice Center, and one of the activists who asked the OTS for more information about the pending merger.
"The OTS got the ball rolling," said Matthew Lee, executive director of Inner City Press/Community on the Move, a community group based in the Bronx. He speculated that the OTS' action may have spurred the Fed to act.
Mr. Lee said he was surprised that OTS specifically asked for the exact branches that would be closed. A more vaguely phrased question, one that assumed that the bank might not know where it would be closing branches, may have elicited far less information, he said.
