ATLANTA — Dozens of groups involved in community development lending on Friday praised the potential benefits of the pending merger of BB&T and SunTrust Banks, but a small number of leaders raised concerns about potential job losses in certain communities.
At the second public hearing for the deal, hosted by the Federal Reserve Bank of Atlanta, about 70 groups were scheduled to offer their views on the combination. Most of the scheduled speakers led or worked for organizations that foster lending and redevelopment in low-income communities or promote financial literacy.
John Hope Bryant, founder and CEO of Operation Hope, admitted that when he first heard about the merger, he did not like it. But after speaking with executives at both banks, he decided that the new organization’s greater size would allow it to do even more to help consumers.
“It was not in my personal interest for these institutions to merge, because everything was just fine” with Operation Hope’s relations with both banks, Bryant said during the public hearing.
“But I like it now,” Bryant said. “We are getting banks out of the ‘no’ business and back into the ‘yes’ business so people can have access to capital.”
The combination would create the nation’s sixth-largest bank, with about $441 billion in assets, and the headquarters would be in Charlotte, N.C. It is the biggest banking M&A deal since the financial crisis, and it is being watched closely as a test of evolving attitudes about consolidation among regulators and lawmakers.
In two daylong hearings held by the Federal Reserve System — the one in SunTrust's hometown of Atlanta on Friday, and another in Charlotte last week — the banks seemed to receive a relatively balanced amount of support and skepticism from witnesses. Nothing at the hearings suggested the momentum behind the deal had slowed.
Still, plenty of hurdles remain. Top congressional Democrats have questioned the deal, saying that deregulation enacted during the Trump administration could result in bigger banks and fewer retail options for the communities now served by the two institutions.
“The proposed merger raises many questions and deserves serious scrutiny from banking regulators, Congress and the public to determine its impact and whether it would create a public benefit for consumers,” House Financial Services Committee Chairwoman Maxine Waters said in February after the deal was announced.
In a letter that same month to Fed Chairman Jerome Powell, Sen. Elizabeth Warren, D-Mass., cast doubt on the resolve of regulators evaluating the deal.
“The [Fed] board's record of summarily approving mergers raises doubts about whether it will serve as a meaningful check on this consolidation that creates a new too big to fail bank and has the potential to hurt consumers,” Warren wrote in the letter.
The impact on everyday people was a primary focus of the hearing Friday.
Branch and office closings stemming from the merger may spell bad news for local communities, said John Rogers, a private real estate investor with Rogers Development in Gainesville, Ga.
“I see a lot of closed branches and a lot of laid off people,” Rogers said. “There are a lot of good people there who are going to need another chance.”
If the merger is approved, BB&T and SunTrust will have a responsibility to address the rising wealth gap in the country, said John Taylor, president of the National Community Reinvestment Coalition.
“BB&T and SunTrust have offered what appears to be sincere commitments to community credit needs,” Taylor said. “But we will see what’s in writing at the end of the day.”
Taylor, who said that he neither supported nor opposed the merger, said he agreed with Sen. Sherrod Brown, D-Ohio, that
“The full board needs to look at the magnitude of this merger,” Taylor said.
Representatives from the Federal Reserve, the Federal Deposit Insurance Corp. and the Georgia and North Carolina state banking agencies sat nearby, listening to the presentations made by Taylor, Bryant and others, but they offered no responses. Kelly King, the head of BB&T, and Bill Rogers, the leader of SunTrust, gave prepared statements that echoed much of the same language as their remarks during the
“There is … much work to be done when it comes to the inequities that still exist in our communities,” King said. “Bill and I can both assure you that we will continue our commitment to serving all our constituents fairly and equally when providing loans, investments and services. Everyone deserves to be treated with dignity and respect.”
The companies will hold shareholder votes early in the third quarter, with the closing expected by the fourth quarter.
Other community organizers on Friday spoke of the extensive financial support they have received over the years from the two banks. BB&T has provided loans to the Alliance of DeKalb County in Decatur, Ga., a
“BB&T brought ideas to the table and partners to the table,” Walker said. “BB&T has stepped up to help us improve and streamline our operations.”
BB&T has provided a total of $30 billion over the past decade to support affordable housing, according to the company. SunTrust provided $600 million in financing in 2018 for affordable-housing units.
Last month, the two banks
The executives said Friday that they plan to spend an extra $100 million annually on innovation and technology to create simple and secure digital experiences for clients. They also vowed to be thoughtful while evaluating branch closures.
Rogers noted during his remarks that the banks will soon offer a plan for community investments like their recent $5 million pledge to the Westside Future Fund, which is backing revitalization efforts in Atlanta’s Westside community.
The two banks have helped local groups with education and counseling for consumers, according to several presenters.
Michelle Jones, executive director of the Atlanta credit counseling agency Clearpoint, said SunTrust has helped her organization counsel consumers on their housing needs.
“I have seen SunTrust repeatedly and reliably step up to the plate,” Jones said. “We believe this merger has the potential to reach even more individuals.”
Hannah Lang and Paul Davis contributed to this article.
