Bank of America Corp. does a worse job than its biggest competitors at making mortgages to minority borrowers and locating branches in mostly minority neighborhoods, according to a labor union study of six major cities, including Buffalo.
The study by the Service Employees International Union examined Bank of America's branching and lending in Buffalo, Chicago, Detroit, New York City, Philadelphia and St. Louis, which were identified by the U.S. Census Bureau as among the 10 most racially segregated cities in the country.
Four other cities were also on that list, but one is in the New York metropolitan area and the bank doesn't operate in the others.
The report found that the nation's largest branch bank is less likely to put offices in mostly minority communities than its top two competitors in each market, and ranked last among the three in locating branches in mostly black neighborhoods in four of the six cities.
The Charlotte, N.C.-based bank was also last for branching in Hispanic communities in half the cities with Hispanic populations large enough to be analyzed, the report said. And it's more likely to be the mortgage lender for white borrowers than black borrowers in all six cities.
"As the nation's largest bank with the largest branch network, Bank of America should be leading in providing access to banking," said Manny Pastreich, deputy director of the SEIU's property services division. "Instead, Bank of America has been leading in shutting minorities out of the American dream."
In Buffalo, where 9.2 percent of the population lives in mostly black ZIP codes and 11.7 percent in a mostly minority ZIP code, Bank of America branches were 15 times and 10 times more likely, respectively, to be in mostly white areas, the report said.
Bank of America, which came to Western New York in 2004 through its purchase of FleetBoston Financial Corp., has 35 branches, $820 million in deposits and $111 million in mortgages in the Buffalo area. Of the offices, 31 are in mostly white areas, while three -- 9 percent -- are in mostly minority areas.
By contrast, seven of M&T Bank Corp.'s 65 offices and seven of HSBC Bank USA's 63 offices -- 11 percent each -- are in minority areas, the report said.
Bank of America dismissed the study.
"The SEIU report is skewed, misses or ignores several important facts, is highly selective in its data and coverage, and is not representative of Bank of America's minority lending and outreach activities," said spokesman Terry Francisco.
He said that more than 30 percent of the bank's 2006 mortgage originations went to minorities, with loans to black borrowers increasing 25 percent from the prior year.
The study examined cities in which Bank of America is not the dominant lender or is new to the market. In Detroit, for example, the bank just arrived last month with its purchase of LaSalle Bank Corp. from Dutch giant ABN Amro NV.
The union said it singled out the nation's No. 2 bank by assets because it has the largest branch network and deposit base in the country, with 5,749 branches in 31 states and Washington, D.C.
The union plans to send the report to lawmakers in hopes of getting more scrutiny of the industry.