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NCRC and New York Community Bancorp announce $28 billion community Benefits agreement to support communities of color, small businesses, and ongoing commitment to responsible multi-family lending

New York Community Bancorp, Inc. (NYCB) and the National Community Reinvestment Coalition (NCRC) announced today the company’s commitment to provide $28 billion in loans, investments and other financial support to communities and people of color, low- and moderate-income (LMI) families and communities, and small businesses. NYCB’s Community Benefits Agreement (CBA) was developed with NCRC and its members in conjunction with the company’s pending merger with Flagstar Bancorp, Inc. (Flagstar). The agreement is subject to closing of the merger with Flagstar.

The agreement includes $22 billion in community lending and affordable housing commitments and $6 billion of residential mortgage originations to underserved and LMI borrowers and in LMI and majority-minority neighborhoods over a five-year period. These significant investments will cover both communities already served by NYCB and those it will expand into through its acquisition of Flagstar, and further the positive community impact of the merger.

“We appreciate the leadership and commitment of NYCB to collaborate with us and our members to create this impactful community agreement,” said Jesse Van Tol, President and CEO of NCRC. “This plan is a significant commitment to increase investments, services and loans for low- and moderate-income communities and neighborhoods of color where these banks operate. With this agreement, we established a new product change and innovation committee that we hope will lead to significant product offerings and added a 40% increase over 5 years in community development loans and investments.”

Once the NYCB/Flagstar merger closes, the combined company will have $85 billion in assets, operate nearly 400 branches in nine states, and 84 retail loan production offices across a 28-state footprint, as well as a national mortgage origination and servicing platform.

“Over the past several months, members of both NYCB’s and Flagstar’s leadership teams have met with NCRC and nearly 80 of its member organizations and were humbled by everything they do for their communities,” said Thomas R. Cangemi, Chairman, President, and CEO of New York Community Bancorp, Inc. “This multi-year agreement reflects our commitment to provide greater economic opportunities for LMI communities and communities of color in both of our market areas and to bridge the racial wealth gap that exists today.”

Added Sandro DiNello, President and CEO of Flagstar Bancorp, Inc., “Flagstar goes into this agreement with the momentum of an outstanding CRA rating and a long history of investing in underserved communities. This is a far-reaching, substantial agreement that aims to move the needle on closing the racial wealth gap and bringing expanded CRA initiatives to the broader footprint of our pending new company. We thank the leadership of NCRC and its members for their hard work in bringing this agreement to fruition.”

Since 2016, NCRC has facilitated similar community benefits agreements with 17 bank groups worth a combined $412 billion for mortgage, small business and community development lending, investments and philanthropy in LMI and under-resourced communities. 

Community benefits agreements are a cornerstone of NCRC’s work to increase the flow of private capital into underserved and under-resourced communities and communities of color, and to end the racial wealth divide. The agreements depend on dialogue between banks, community organizations and local reinvestment coalitions to identify local priorities and strategies to address them, which continues after an agreement is established through community councils set up to advise on implementation and to monitor bank performance.

The NYCB agreement addresses several important areas of community needs identified during bank meetings with NCRC and its member organizations. These include, but are not limited to:

  • Affordable Housing and Residential Mortgage Lending: NYCB pledges to originate $5.7 billion of loans for home purchases, refinances, home improvement and home equity loans to underserved and LMI borrowers and in majority-minority communities. The company will also provide loan products or participate in affordable housing programs which address the specific needs of LMI borrowers and create a $10 million down payment assistance fund to support home ownership for LMI borrowers. 
  • The Continuation of Our Responsible Multi-Family Lending Practices: NYCB is committed to promoting fair and responsible multi-family lending practices for all multi-family loans within its portfolio. These include practices designed to prevent community harm and protect tenants’ rights, such as displacement, speculative investing, landlord vetting, lead paint abatement, and tenant outreach programs.
  • Small Business Lending: NYCB will provide $542 million in loans to small businesses with less than $1 million in revenues and in LMI and majority-minority communities. In addition to originating loans directly to small businesses, the company will also provide funding to nonprofit organizations that assist small businesses and provide grants to small businesses, including those that were impacted by COVID-19.
  • Community Development Lending and Investments: The company intends to invest $21.7 billion in community development loans and investments, including those that address the needs of LMI communities and individuals and New Markets Tax Credit and Low Income Housing Credit projects. As part of this, NYCB will invest in homeownership and affordable housing strategies with minority-led organizations in Detroit and organizations that address housing issues in minority communities. In addition, NYCB will continue to observe responsible multi-family lending practices designed to prevent tenant displacement with the aim of ensuring that tenants are treated fairly.
  • Philanthropy: NYCB will commit $16.5 million in philanthropic support to nonprofit organizations that meet the needs of LMI and majority-minority communities and individuals. This includes support for those organizations with majority-minority leadership and nonprofit organizations serving immigrant and refugee communities, housing counseling, foreclosure prevention, and workforce development.
  • Access to Banking Products and Services: As a result of the merger with Flagstar, NYCB does not plan to close any branches, including branches in LMI or majority-minority communities. In addition, the bank will seek to maintain a diverse and inclusive workforce which reflects the demographics of the communities it serves and will endeavor to maintain its practice of staffing branches by individuals who live in the same communities and who are conversant in the language spoken in their communities. NYCB will also prioritize employment opportunities within the local communities. The company will continue to offer banking products and services to financially underserved communities and individuals, including access to its Bank On certified “Simply One” product.

Additional initiatives include financial education programs for seniors, adults, children and small businesses, supplier diversity and age-friendly banking.

“We believe that this important and groundbreaking level of commitment will benefit all of the communities we currently serve and the newer communities we plan to serve once our merger with Flagstar closes. I would also like to thank Jesse Van Tol and his team at NCRC for their leadership and guidance during this process,” Cangemi said.

NCRC Member Quotes

“ANHD and our Equitable Reinvestment Coalition applaud NYCB for making strong commitments to low- and moderate-income communities and communities of color. NYCB’s plan takes steps to meet local needs here in New York City, including new branches and products, investments in CDFIs, and additional resources to prevent harassment and displacement in multifamily buildings they finance.” Barika Williams, Association for Neighborhood and Housing Development (ANHD), New York, New York

“Ariva, Inc applauds this expanded commitment by NYCB-Flagstar which will provide critical investment in our South Bronx neighborhoods. We are particularly appreciative of the expanded branch commitment. So many of our residents are unbanked or underbanked; the branch expansion will help more of our neighbors move into the financial mainstream.” Irene Baldwin, Ariva Inc. Bronx, New York

“New Hour provides support for hundreds of women throughout Long Island and New York State facing reentry each year. We are grateful for the commitment of financial institutions whose support for women and men re-entering our community is essential to creating safer communities and stable families.” Serena Liguori, New Hour for Women & Children LI, Brentwood, New York

“”We are thankful to see the many ways that New York Community Bank will challenge itself to enhance its commitment to communities across Indiana as it grows its presence here.” Jessica Love, Prosperity Indiana, Indianapolis, Indiana 

“With 20 years as a CRA officer before becoming executive director of Ifetayo, I know the impact of a bank authentically collaborating with community-based organizations to enhance its CRA strategy. I am pleased that through our joint efforts, NYCB has recognized that community-based arts and culture is a critical part of community development and has agreed to provide annual grants for CRA qualified community development art culture initiatives. As a Black female Executive Director, I am encouraged that NYCB has agreed to start tracking and increasing how much of their philanthropy goes to organizations with Black, Latinx, and Asian leadership.” Naima Oyo, Ifetayo Cultural Arts Academy Inc., Brooklyn, New York

“NYCB and Flagstar have shown a historical commitment to moving the needle on creating equitable banking and finance options, as well as, involvement with the community in Detroit.  There is a lot more work that needs to be done, and can be done with their increased and leveraged commitment.  We hope that this merger will better position NYCB-Flagstar to affect change and bring about equitable lending and wealth creation in underserved neighborhoods.” Fikre Prince, Central Detroit Christian Community Development, Detroit, Michigan

“New Jersey Citizen Action has worked with NCRC for many years as they facilitated community benefits agreements worth a combined $412 billion in mortgage, small business, community development lending, investments, and philanthropy for low and moderate-income folks and under-served communities. This new comprehensive plan outlines specific goals for lending, investment, banking accessibility, diversity, and inclusion practices in New Jersey that  we anticipate will  deepen our  partnership with New York Community Bank.” Phyllis Salowe-Kaye, New Jersey Citizen Action, Newark New Jersey

“Devotion USA applauds this New York Community Bank – Flagstar Bank community benefits agreement.  We look forward to working with NYCB-Flagstar to bring true economic development and prosperity to low and moderate-income communities and traditionally underserved communities of color.” Michael West, Devotion USA, Inc., Brooklyn, New York“

“Long Island Housing Services is thankful for the National Community Reinvestment Coalition’s successful work in organizing local stakeholders to help New York Community Bank (NYCB) better serve our communities including providing increased access to mortgages for historically underserved areas. This partnership is particularly satisfying to me as I was their employee in the late 1980s and have been a customer for nearly 40 years.” Ian Wilder, Long Island Housing Services, Inc., Bohemia, New York

Organizations Supporting the Community Benefits Agreement

Ariva, Inc

Asian Americans For Equality

Association for Neighborhood and Housing Development (ANHD)

BOC Capital Corp.

Bridging Communities, Inc.

CEDAM

Central Detroit Christian Community Development

Chicanos Por La Causa

Community Reinvestment Alliance of South Florida

Cooper Square Committee

Devotion USA, Inc.

Famicos Foundation

Ifetayo Cultural Arts Academy Inc.

LINC UP Nonprofit Housing Corporation

Long Island Housing Services, Inc.

Metropolitan Milwaukee Fair Housing Council

Neighborhood Housing Services of Queens CDC

New Jersey Citizen Action

New York City’s Equitable Reinvestment Coalition

New Hope Community Development

New Hour for Women & Children LI

Perfecting is Heart to Heart Ministries

Prosperity Indiana

Renaissance Economic Development Corp.

Southwest Economic Solutions

SunRaise Consulting, LLC

The Greenlining Institute

U-SNAP-BAC

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About the National Community Reinvestment CoalitionThe National Community Reinvestment Coalition and its grassroots member organizations create opportunities for people to build wealth.  We work with community leaders, policymakers, and financial institutions to champion fairness in banking, housing, and business.  NCRC was formed in 1990 by national, regional, and local organizations to increase the flow of private capital into traditionally underserved communities.  NCRC has grown into an association of more than 6oo community-based organizations in 42 states that promote access to basic banking services, affordable housing, entrepreneurship, job creation, and vibrant communities for America’s working families.  More can be found at: www.ncrc.org.

About New York Community Bancorp, Inc.

Based in Hicksville, NY, New York Community Bancorp, Inc. is a leading producer of multi-family loans on non-luxury, rent-regulated apartment buildings in New York City, and the parent of New York Community Bank. At September 30, 2021, the Company reported assets of $57.9 billion, loans of $43.7 billion, deposits of $34.6 billion, and stockholders’ equity of $7.0 billion. 

Reflecting our growth through a series of acquisitions, the Company operates 236 branches through eight local divisions, each with a history of service and strength: Queens County Savings Bank, Roslyn Savings Bank, Richmond County Savings Bank, Roosevelt Savings Bank, and Atlantic Bank in New York; Garden State Community Bank in New Jersey; Ohio Savings Bank in Ohio; and AmTrust Bank in Florida and Arizona.

Media contacts:

Alyssa Wiltse
NCRC
awiltse@ncrc.org

Sal DiMartio
NYCB
salvatore.dimartino@mynycb.com

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Summary Of The Community Benefits Agreement Between The National Community Reinvestment Coalition and New York Community Bank

New York Community Bank (NYCB) will lend or invest $28 billion to underserved borrowers and communities over a five-year period.

Mortgage Lending to the Underserved
Commitment: Over $5.7 billion in home purchase, home improvement and home equity, and refinance lending to underserved borrowers and communities over 5 years

NYCB commits to separate and specific mortgage goals for Black borrowers, Latinx Borrowers, Asian Borrowers, and borrowers with low-and-moderate incomes. Lending goals for each state and for each type of mortgage lending ensure that each underserved group will experience an increase of at least 55% over the next five years. To achieve NYCB’s mortgage goals, NYCB will create a targeted down payment assistance fund of $10 million and take into account non-traditional income sources in NYCB’s underwriting such as rental and utility payments. NYCB will also develop and deploy additional affordable home loan products for homes that cost under $150,000 and first generation homebuyers, both with special affordability features such as waived PMI, alternative forms of credit, reasonable DTI, down payment assistance, and connection to HUD-certified counselors.

Small Business Lending
Commitment: $542 million over 5 years

NYCB commits to separate and specific small business lending goals for each state in NYCB’s footprint that all represent increases over the previous small business lending of NYCB or Flagstar. To accomplish this, NYCB will develop partnerships and/or referral programs with local CDFIs including a second look/referral program to refer declined borrowers to local CDFIs for access to credit and technical assistance. NYCB will also provide equity equivalent investments to CDFIs to promote small business lending, explore the feasibility of a “CRA small business loan” with flexible underwriting, access to technical support, and financial assistance for small businesses, and will assess the feasibility of gap/bridge financing for businesses that have received contracts from public agencies.

Community Development Lending and Investment (CDLI)
Commitment: $21.6 billion over 5 years

NYCB commits that each state in its branch footprint will receive an increase in community development from the previous levels of either NYCB or Flagstar, and that NYCB will report on their progress at achieving this on an annual basis. Included in this, NYCB will provide EQ2 funding and other loans and investments to CDFIs and grants to organizations that provide financing to land banks and land trusts, and support shared equity forms of affordable housing and community efforts to acquire and preserve distressed assets.

CRA Focused Philanthropy
Commitment:  $16.5 million over 5 years

NYCB commits that each state in its branch footprint will receive an increase in CRA eligible philanthropy from the previous levels of either NYCB or Flagstar. Included in this, NYCB will increase philanthropic support for; organizations led by people of color; tenant organizing; services that help people gain employment and get job training; successful post-incarceration reentry and lasting reintegration initiatives; and provide annual grants for CRA qualified community development art and culture initiatives.

Supplier Diversity

NYCB will ensure that 20% of its total branch, non-banking system expenditures are with suppliers and/or subcontractors that are minority- and/or women-owned businesses by the end of 2024. NYCB will also increase its number of diverse suppliers by at least 20% by the end of 2024. To accomplish this, NYCB will conduct outreach to media outlets and marketing firms owned by people of color, and partner with community organizations to help meaningfully increase the diversity of its supplier base and branch workforce.

Responsible Lending Practices

NYCB will commit to observing responsible multifamily mortgage lending practices for all multifamily loans within the bank’s portfolio, including loans not submitted for CRA credit. These practices are designed to prevent displacement and ensure that tenants in multifamily buildings are treated fairly and with respect. Agreed to practices include details on vetting of landlords, lead paint abatement, submitting loans for CRA credit and reporting, tenant outreach, and participation in New York City’s First Look program.

Product Innovation Committee

NYCB will create a product change and innovation committee to discuss changes to NYCB’s products. In addition to key bank personnel, the committee will include NCRC, the Association for Neighborhood & Housing Development, and at least three other NCRC members. This committee will report and meet with NYCB executive management to discuss and consider product changes. It is expected that there will be at least two significant product-offering changes during the Plan Period, including the possibility of offering an ITIN mortgage pilot program, a home purchase and repair product, and exploring ways to best target BIPOC borrowers as part of a special purpose credit program.

Strategic Planning & Implementation

NYCB will meet with community organizations to implement the terms of the agreement in each of its CRA assessment areas. NYCB will work with NCRC’s members and local coalitions to come up with specific plans for how the agreement will be implemented in their markets. This will include establishing agreed upon reporting at a local level, and collective meetings with local coalitions to discuss progress and opportunities at least twice a year. NYCB will encourage its staff to volunteer with community-based organizations, serve on boards, act as a point of contact for such organizations, and relay feedback from communities.

Agreement Governance and Report Outs

NYCB will expand the existing Flagstar Community Advisory Committee to include organizations and representatives from across the new footprint of the bank. NYCB will include NCRC on the council and will consult with NCRC to name new representatives. NYCB will provide annual progress reports on its performance under this Agreement, using a format mutually agreed upon with NCRC. NYCB will work with NCRC to release this report by the end of the second quarter of each year of the Agreement, the first report will be available by the end of June 2023. This report will be made available to the public and will include data on mortgage lending, staff diversity at NYCB, community development activity and partnerships, philanthropic support for organizations led by people of color, and minority and women owned business supplier diversity spend and percentage, as well as state level breakdowns of the implementation of the Agreement. NYCB also commits to having its CEO and other top executives take part in two annual meetings during the third quarter of each year of the Plan Period to discuss the Annual Report for the prior plan year, and to gather community input on implementation issues, or new community priorities that arise. NYCB will also take part in a meeting during the third quarter of the first year of the Plan Period (2022) to discuss initial progress in implementing the Agreement. NYCB will work with NCRC on the guest list and agenda for these annual meetings.

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

Complete the form to download the full report: