The Greenlining Institute filed a protest Friday with the Office of Thrift Supervision against Glendale Federal Bank's proposed merger with Cenfed Bank.

Robert L. Gnaizda, general counsel for the community activist group, said Glendale Federal is not lending enough to minorities.

"We still think a thrift charter means you have to originate home loans," he said, claiming Glendale Federal booked just seven loans to African-Americans earning under $35,000 in California during 1996.

Separately, Mr. Gnaizda said Greenlining opposes the offer Glendale Federal made the government Thursday to settle a goodwill case. Glendale Federal said it would use the $1.5 billion to fund low- and moderate-income lending. According to Mr. Gnaizda, Glendale Federal is asking the government to pay for the thrift's Community Reinvestment Act compliance.

"We oppose the government giving them money to do what they are already obliged to do," he said. "We thought this would be in addition to all their CRA responsibilities. Instead, this is a substitute for what's required of them any way."

Glendale Federal is one of more than 100 thrifts that sued the government after Congress in 1989 reneged on a deal and required fast writeoffs of supervisory goodwill.

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