One of the largest banks in the nation has agreed to pay $13.5 million to settle allegations of redlining, CBS News reports.
The settlement comes after the Department of Justice found the First National Bank of Pennsylvania discriminated against Black and Latino homebuyers in Charlotte and Winston-Salem, North Carolina between 2017 and 2021.
Headquartered in Pittsburgh, First National Bank of Pennsylvania bought Yadkin Bank, a regional bank in the Carolinas, in 2017. According to the DOJ, First National “closed branches in majority-minority neighborhoods, failed to provide mortgage services to Black and Latino potential borrowers, and ignored entire neighborhoods for potential lending” for at least four years, per CBS News. The DOJ further alleged that “lenders of similar size and scope to First National did two to four times as much lending to minority borrowers between 2017 and 2021 as First National.”
First National claims the issues stem from before they acquired Yadkin Bank. However, the DOJ said FNB should be held accountable for the acquired bank’s actions.
“When banks discriminate, it means hardworking people can’t buy a house, start a business, or invest in their futures,” North Carolina Attorney General Josh Stein said in a statement. “I want every person who calls North Carolina home to have a fair shot, and I’m pleased that this settlement will create better borrowing opportunities for all North Carolinians.”
FNB spokesperson Jennifer Reel said the bank was fully compliant with federal and state lending laws. Reel noted the company settled the case to put the matter behind them.
“We cooperated fully to reach an agreement in this inherited matter as a good faith effort to avoid prolonged litigation,” Reel said in a statement.
Most of the $13.5 million will toward a fund to help subsidize loans for Black and Latino borrowers in North Carolina.
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