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The Color of Money

Follow-ups and reaction

Black legislators seek to probe
loan pattern with state bank chief

By Bill Dedman, The Atlanta Journal-Constitution

Published May 6, 1988, Page A1

Copyright 1988, The Atlanta Journal-Constitution

Black legislators called Thursday for a meeting with the state banking commissioner to discuss unequal lending patterns of banks and savings and loans.

"I'm not accusing the lending institutions of being racist, but I'm saying there are unmistakable differences out there," said state Sen. Gene Walker of DeKalb County, the only black member of the Senate Banking and Finance Committee. "We're going to ask the commissioner to look into these matters. We're going to do everything we can to get to the bottom of this."

The suggestion to meet with Commissioner Jack Dunn was made jointly with Sen. Arthur Langford, chairman of the Senate Consumer Affairs Committee. Langford attended the Atlanta City Council's special meeting with bank executives Wednesday.

"The banks are basically admitting that there is a problem. So now we're all up to speed. Blacks have known for years that there was a problem," Langford said. "Now we have to come up with some clear-cut, definite solutions."

The lending patterns were described this week in a series of articles in The Atlanta Journal-Constitution. Lenders' reports to the federal government showed that banks and savings and loans in metro Atlanta made five times as many home loans in white areas as in black areas of the same income and housing growth.

In other responses:

The Southern Christian Leadership Conference has asked its attorney to research the possibility of a class-action suit against banks and savings and loans. The president, the Rev. Joseph Lowery, also urged blacks to open accounts at black-owned institutions.

"We knew it was a problem. We're just glad to see it documented," Lowery said. "We're going to definitely do something."

The Atlanta Urban League president, Lyndon Wade, urged lenders to take the articles as an opportunity for improvement.

"I think it's a sad commentary, if these facts cannot be refuted. And I don't see anyone standing up to refute this," Wade said. "This could be a major blemish on Atlanta's image, but more than that it's a terrible, crippling blow to black people. But the banks have done a lot of good things in the community. It is time for the institutions to pull themselves together."

Henry Garmon, chairman and chief executive officer of Fulton Federal Savings and Loan Association, agreed to serve as chairman of the City Council's special committee on the lending problem. City Council President Marvin Arrington said he would name other members today from political, business and community circles.

Mayor Andrew Young said, "The newspaper made a strong case. There has been enough of a public indictment so that we will probably get a better response from the banking community than we ever had before."

The call for a meeting with the banking commissioner was endorsed by five Atlanta legislators: Sens. David Scott and Hildred Shumake, and Reps. Betty Clark, Grace Davis and Mable Thomas.

"There are some nice people at the banks, but it's a whole process of discrimination," Scott said. "The only thing they would respond to is if we had a hammer over their heads."


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Reprinted with permission from The Atlanta Journal and The Atlanta Constitution. Further reproduction, retransmission or distribution of these materials without the prior written consent of The Atlanta Journal and The Atlanta Constitution, and any copyright holder identified in the material's copyright notice, is prohibited.


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