With the announcement of Fifth Third Bank closing its Swayne Field branch on Monroe Street near Detroit Avenue, community members are concerned about the negative impact it may have on its low- and moderate-income residents.
Organizations such as Toledo Community Coalition and the Fair Housing Center think the closure on March 30 will create a barrier for those families in need of in-person services such as financial consultation as well as home loans and credit loans.
“If you’re low to moderate income, you’re more likely to need that in-person contact for banking needs that require you to go into the physical branch, either with your check or if you need to talk to someone,” George Thomas, CEO and general counsel for the Fair Housing Center in Toledo, said.
Mr. Thomas said a resident’s inability to access those services physically could be “devastating” to the community and should trigger concern.
The alternative for some of the affected residents could be financial services with expensive premiums including payday loans, cash checking, and money order services, he said.
The Fair Housing Center, with the support of Toledo Community Coalition, sent a letter Thursday to the Office of the Comptroller of the Currency regarding the closure. They are seeking a meeting for further discussions.
Mr. Thomas and the secretary of the coalition, Juanita Greene, said the community wasn’t given a timely notice of the closure given it’s in a community that has a historically low-income population.
Laura Passerallo, vice president and director of marketing at Fifth Third Bank, said on Wednesday that’s not the case.
“We always let our customers know at least 90 days in advance of an office closing,” Ms. Passerallo said in an email. “We let them know where the closest financial center is and we informed some community members at the same time.”
Ms. Passerallo said the Office of the Comptroller of the Currency was also notified of the closure. That along with the 90-day notice are two of the requirements under the Federal Deposit Insurance Act, she said.
Fifth Third Bank is directing people to its Lagrange branch, which is two miles away from the central Toledo Swayne Field branch, Ms. Passerallo said.
The letter from the Fair Housing Center, though, argues that while some people will be able to make the drive, other residents might have to walk to the new branch.
The letter also suggests Fifth Third Bank is leaving the area based on profit and the closure supports a trend of the bank leaving Black and minority communities.
“They [residents] deserve the same services as everyone else,” Mrs. Greene said.
“If profit loss is driving the decision to close this branch, then Fifth Third Bank is leaving this area where the minority residents lack the wealth to significantly contribute to the profits of Fifth Third, when redlining practices by similar banks 80 and 90 years ago are largely to blame for the loss of opportunity to create and pass on generational wealth by those residents,” the letter reads.
The reason for the closure, Ms. Passerallo said, is a trend of the bank’s customers transitioning to online banking as well as accessing services online.
“We evaluate our branch network on an ongoing basis,” Ms. Passerallo said via email Thursday. “The key driver is looking at consumer preferences and how they want to bank. The analysis includes a matrix of dozens of variables when assessing any branch or potential location. Consumer banking behaviors are a significant consideration, as we strive to meet their needs in the time, place, and channel they desire.”
Mrs. Greene and Mr. Thomas expressed frustration that their respective organizations weren’t consulted, stating the FDIA requires banks in low-income neighborhoods to hold a public meeting before a closure.
The FDIA, however, doesn’t require this, according to the Office of the Comptroller.
The law does provide a process for convening a public meeting if an interstate bank proposes to close a branch in a low- or moderate-income area and does so if certain criteria are met. That includes a written letter from an affected resident, a statement of specific reasons for the request, including a discussion of the closing’s adverse effect on the availability of banking services in the area affected by the branch closing, and the OCC concludes that the request is not frivolous.
The Federal Reserve Board has the same standard for national banks, which is what Fifth Third Bank is classified as.
When all of these criteria are met, the OCC consults with community leaders in the area affected by the closing, Office of the Comptroller of Currency spokesman Stephanie Collins said in an email on Wednesday. Also convened is a meeting of OCC representatives of depository institution regulatory agencies and community leaders in the affected area, she said.
“The meeting’s purpose is to explore the feasibility of obtaining adequate alternate services for the affected area following the closing of the branch,” Ms. Collins said.
First Published February 16, 2023, 11:01 p.m.
