Federal regulators granted a public hearing next month on the proposed acquisition of MUFG Union Bank by US Bancorp, a victory for community activists who have pushed for a chance to weigh in on the $8 billion deal.
The hearing will be held virtually on March 8, the Federal Reserve and the Office of the Comptroller of the Currency announced Monday. Anyone wishing to make a public comment at the meeting must register by March 1.
It will be the first public meeting regulators have called for a bank merger since 2019, when two meetings were held for the BB&T-SunTrust Banks deal that formed the $541 billion asset Truist Financial.
The hearing comes at a time when federal banking agencies are under pressure to take a closer look at consolidation within the industry.
Last year, President Biden signed a decree pushing the Department of Justice and federal regulators to review their process for reviewing bank merger and acquisition applications. At the time, the White House was concerned about how these deals have been shown to reduce small business lending and branch availability and lead to higher borrowing costs for people of color.
House Financial Services Chair Maxine Waters, D-California, urged federal banking regulators at a Sept. 29 hearing to grant more public hearings on the M&A deals and allow defenders to publicly raise their concerns with bank executives.
Meanwhile, Martin Gruenberg, who took over as interim chairman of the Federal Deposit Insurance Corp. monday after Jelena McWilliams resignedsaid he intended to continue the changes the agency’s bank merger review policies.
“In light of the significant implications of bank mergers for competition, safety and soundness, financial stability, and meeting the financial service needs of communities, careful interagency review of the bank merger process is warranted,” the Commission said. FDIC in a statement.
Community groups in California have raised concerns about the U.S. bank’s lending practices of $573 billion in assets and the effect that the loss of San Francisco-based Union Bank to the biggest business could have for many quarters. In one letter sent to regulators last year Calling for a public hearing on the merger, the California Reinvestment Coalition said the U.S. bank’s mortgage lending to low-income areas and to borrowers of color lags its peers.
US Bank said expanding its presence in California with the acquisition of the $133 billion asset-based Union Bank would benefit customers as the added scale would help it better compete with Wells. Fargo and JPMorgan Chase.
American bank executives said in january that they still expect the deal to close in the first half of this year.
A US Bank spokesperson said in a statement Monday that “listening to community leaders and stakeholders has always been a priority.”
“We welcome the continued opportunity to hear from stakeholders and members of the communities we serve about how we can ensure this combination provides customers with the banking services they need and promotes competition,” said the spokesperson.
The bank met with community groups like the National Community Reinvestment Coalition during the process.
“It is good that regulators are reviewing bank mergers to ensure they will benefit the communities affected by such transactions,” NCRC chief executive Jess Van Tol said Monday. “We are pleased that this public hearing gives these communities the opportunity to share their thoughts on the proposed agreement.”