Las Vegas community groups released an extensive and highly damaging report last week charging the city's largest banks with redlining.
"The report shows that Las Vegas banks have cordoned off the West Side and imposed a financial curfew on its largely African-American residents," said state Sen. Joseph M. Neal.
The banks cited in the report all denied the allegations.
Not Far from The Strip
The mostly minority, low-income community, racked by violence since the Los Angeles riots last month, got only 59 of the more than 10,000 home loans made in Las Vegas in 1990, according to the report.
The report was based on data made available under the 1990 Home Mortgage Disclosure Act.
Of the four biggest Las Vegas lenders, First Interstate Bank, PriMerit Bank, and Citibank, each made only three loans in West Side neighborhoods in 1990, according to the report. Valley Bank, which has since been acquired by BankAmerica Corp., made 12.
Rejection Rates Compared
First Interstate Bank rejected middle-income blacks six times more often than whites with the same incomes, the study said. Valley Bank's two West Side offices had $96 million in deposits in 1990, but invested only $564,000 in home loans in the area, the report said. First Interstate's two branches had $94 million in deposits but invested only $59,000 in home loans in the area, the study showed.
"Valley Bank never has and never will redline or discriminate," said Paul Stowell, director of public relations. Valley has an "outstanding" CRA rating.
Conducted Own Review
First Interstate, which has a "satisfactory" rating, said a review of rejected mortgage applications found "no indication of any kind of bias," said Andrew Studdert, who oversees First Interstate's southern Nevada operations. The bank is a unit of Los Angeles-based First Interstate Bancorp.
PriMerit Bank "just had a compliance exam, and there is certainly no evidence of discriminatory lending here," said Chuck Dixon, executive vice president. The thrift has a satisfactory CRA rating.
Citibank of Nevada, which has a satisfactory CRA rating, is still studying the report. But Barbara Mulholland, director of external affairs, said deposit figures for the bank were vastly overstated.
For example, she said, the Citicorp unit has $212 million in deposits in Las Vegas, not $900 million as in the report.
The report was prepared by the Las Vegas Alliance for Fair Banking, which includes representatives of the NAACP, Culinary Local 226, and community groups, churches, homeowner associations, and elected officials.