WASHINGTON - Add another challenger to First Union Corp.'s deal to buy Wachovia Corp.
On Monday, the same day SunTrust Banks Inc. made a hostile bid for Wachovia, Inner City Press/Community on the Move, an activist group in New York's Bronx borough, said that it had asked the Federal Reserve Board for public hearings on the First Union-Wachovia merger.
Inner City Press cited First Union's acquisition of Money Store, a consumer finance operation the Charlotte, N.C., company shut down last year because of poor performance. It says First Union continues to be involved in subprime lending and that it would have an "anticompetitive" share in more than six markets.
A First Union spokeswoman on Tuesday said her company and Wachovia, of Winston-Salem, N.C., "have outstanding Community Reinvestment Act ratings and are proud of our record."
First Union has proposed shedding 250 to 300 branches to allay antitrust concerns. The spokeswoman said branch overlap would occur in a "handful of markets" and the combined company, in an attempt to prevent neglect of low-income neighborhoods, would spend two to three years deciding which branches would remain.
Matthew Lee, executive director of Inner City Press/Community on the Move, said on Tuesday that the group will oppose a SunTrust-Wachovia combination on similar grounds.
