Chemical Lists 14 Branch Closings
Manufacturers Hanover Corp. and Chemical Banking Corp. said Wednesday they would close 14 of 91 branches in low- and moderate-income communities when they merge next year.
The affected New York neighborhoods will retain 77 branches of the new Chemical, significantly more than that of its main competitors, the banks said.
By quickly announcing their plans for low- and moderate-income areas, the banks are attempting to allay concerns of community groups and public officials. Though encouraged by the initial consolidation plan, these groups indicated Wednesday that they are waiting for more complete information before endorsing the merger.
70 Branch Closings Projected
In total, the new Chemical is expected to close about 70 of the two banks' 436 branches in the region. The banks will not determine which other branches to close for several months.
The Association of Community Organizations for Reform Now, known as ACORN, has said it intends to protest the banks' merger either under the Community Reinvestment Act or federal antitrust laws. A group representative could not be reached for comment.
"We're obviously concerned about already underbanked communities now potentially having even fewer tellers, longer lines, fewer check-cashing facilities, far longer walks to ATMs," said Mark Green, New York City's consumer affairs commissioner.
A Manufacturers Hanover spokesman said the 14 branches targeted for closing have an overlapping branch with the merger partner within three blocks. The new Chemical plans to invest $3 million in upgrading the remaining branches, including the installation of 12 ATMs.
Before announcing the branch closings, bank officials discussed the plan with community groups and public officials, including New York Mayor David Dinkins and Derrick Cephas, state superintendent of banks.
This cooperative approach may represent a turning point in banks' often acrimonious relations with community groups.
Allen Fishbein, director of the Washington, D.C.-based Center for Community Change, said the banks "are supersensitive about their relations with their local communities." The attention, he said, illustrates "the perceived strength of the community reinvestment movement."