American Banker, July 22, 2019: Inside BB&T-SunTrust’s community reinvestment plan
When the House Financial Services Committee discusses the proposed BB&T-SunTrust merger at a hearing Wednesday, lawmakers will likely be keenly interested in the deal’s impact on rural and low-income communities.
To that end, the two banks and the National Community Reinvestment Coalition announced a $60 billion “community benefits plan” on July 16. The pledge, which is similar to pacts other banks have inked in advance of mergers, represents how much the new bank — to be named Truist Financial — will reinvest over three years through mortgages, small-business loans and other commitments.
The $60 billion figure was calculated based on each bank’s average investments that are eligible for CRA credit made over the past three years with an additional 5% increase added on top, said Jesse Van Tol, the chief executive of the National Community Reinvestment Coalition. The 5% increase amounts to more than $1 billion a year in CRA-eligible lending above what each bank would have invested as standalone entities.
“We use and celebrate the $60 billion number because it is a way for people to understand that this is a big deal, this is significant,” Van Tol said. “But the quality is the more significant thing. Our whole process is aimed at meaningful commitments.”
