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COMMUNITY REINVESTMENT COALITION
1 WEST MAIN STREET, SUITE 200
ROCHESTER, NEW YORK 14614
October 12, 2021
Deborah L. Herrmann, NBE
Northeastern District, Syracuse NY Field Office
5000 Brittonfield Parkway, Suite 102B
East Syracuse, NY 13057
Via email: Deborah.Herrmann@occ.treas.gov
Re: Canandaigua NB&T CRA Performance, 2018-2020
Dear Ms. Herrmann:
We are writing to you on behalf of the Greater Rochester Community Reinvestment Coalition (GRCRC) to submit comments regarding Canandaigua National Bank & Trust’s (CNB) CRA Exam conducted by the Office of the Comptroller of the Currency (OCC) for 2018 through 2020. This letter is an update from our October 8th letter; it includes updates and input from CNB based on staff review of that letter.
The Greater Rochester Community Reinvestment Coalition (GRCRC) was launched in 1993 to generate and continue discussions about lending patterns in Rochester. GRCRC, convened by Empire Justice Center, has met with numerous banks and state and federal regulators during CRA exams and mergers, and submitted dozens of data-driven comments to the appropriate state and federal regulators who have oversight of the banks. GRCRC, Empire Justice Center, and its predecessor organization the Public Interest Law Office of Rochester, have released seventeen analyses of home mortgage lending, small business lending, and access to credit over the past 28 years. The organizations use data driven analyses to identify strengths and weaknesses in lending patterns and to generate discussions with the top financial depositories in the Rochester NY MSA.
In September, GRCRC met virtually with CNB to review its CRA-related lending, investing and services performance. Several GRCRC members shared about their work in the Rochester community and opportunities for support, and CNB touched upon some of its investments, its indirect auto lending, and how it works with customers who speak languages other than English and the Deaf and hard of hearing community. This letter incorporates much of the information shared at our meeting.
We thank the OCC for meeting with us at the end of September so we could share about the Rochester community, comments from GRCRC members, and some of our lending tables.
We shared a draft of this letter with CNB for its feedback and met with the bank to discuss clarifications and updates. The results of that meeting and the bank’s feedback are incorporated into this letter.
Canandaigua NB is very important to the Rochester metropolitan area. It is the 4th largest depository institution serving the area. As of June 30, 2020, CNB had $2.88 billion in deposits at its 25 offices in the Rochester area and almost 13 percent of the market.  (See Table 1 in Appendix.)
These comments focus on three areas:
- CNB’s HMDA/Mortgage Lending
- CNB’s CRA Small Business Lending
- CNB’s Reinvestment of Deposits into the Community, Response to Community Needs and Opportunities for Investment
CNB’S HMDA LENDING IN MSA and UNDERSERVED COMMUNITIES
Our lending analysis focuses on originated loans. We examine lending from 2017-2020 to align with the lending exam period with a baseline of 2017 before the exam period.
This section on CNB’s HMDA lending is divided into the following categories:
- Total number loans and total dollar volume mortgage lending
- Home purchase loans
- CNB’s lending compared to its peers
CNB’s Total Mortgage Lending
In 2020, CNB originated 2,643 mortgage loans (1st lien loans on owner-occupied (principal and secondary), 1-4 family site-built units) in the Rochester MSA compared to 1,175 loans in 2017, an increase of 125 percent. (See Table 2 in Appendix). Between 2019 and 2020, CNB’s total loan originations increased by 112%, so most of the increase over the exam period was between 2019 and 2020. When comparing total lending changes to home purchase lending changes (Table 4), it looks like all financial institutions in the Rochester MSA and CNB are following the national trend of 2020 as a big refinance year. “About 90 percent of the increase in closed-end site-built single-family originations in 2020 was driven by the increase in refinance loans. Refinance originations increased from 3.4 million in 2019 to 8.4 million in 2020, which is an approximately 5.0 million or 149 percent increase.”
As seen in Table 2, while there was a 125 percent increase in the total number of mortgage loans made by CNB in the Rochester NY MSA between 2017 and 2020, its lending increased at much lower rates in low-moderate income and majority nonwhite census tracts. Between 2017 and 2020, CNB’s lending:
- Increased by 80% in the city.
- Increased by 100% among Black/Latino households.
- Increased by 82% among low-moderate income households.
- Increased by 63% in low-moderate income census tracts
- Increased by 53% in majority nonwhite census tracts (50% or more nonwhite residents).
CNB’s distribution of its loans to areas and populations in the Rochester community that have been historically redlined or underserved is somewhat inconsistent (see the bottom section of Table 2). Still, while CNB’s distribution of loans to the city of Rochester declined slightly between 2017 and 2020, its distribution in 2020 matched the average for all financial institutions (AFI), and its distribution of loans in nonwhite census tracts was similar to that of AFI. When we shared our assessment with the bank, CNB explained that in a big refinance year, penetration in low-moderate income households or neighborhoods is difficult due to lower appraised values, higher loan-to-values or inability to pay closing costs (either directly or in the mortgage). Of the 2,643 loans CNB made in 2020,
- 8% were in the city, compared to 8% in 2017, and 8% for AFI
- 4% were to Black and Latinx households, compared to 4% in 2017, and 8% for AFI
- 24% were to low-moderate income households, compared to 30% in 2017, and 30% for AFI
- 7% were in low-moderate income census tracts, compared to 10% in 2017, and 10% for AFI
- 3% were in nonwhite census tracts, compared to 4% in 2017, and 4% for AFI
Total Dollar Volume Lending
In 2020, CNB originated an aggregate of $551.4 million in total mortgage lending (1st lien loans on owner-occupied (principal and secondary), 1-4 family site-built units). As seen by Table 3 in the Appendix, this was $345.5 million or 168% more than the bank’s dollar volume of lending in 2017. As with total number of loans, most of this increase occurred between 2019 and 2020, when dollar volume of lending increased by 138%, again indicating the 2020 was a big year for refinance mortgages.
CNB’s total dollar volume of lending increased in every other category as well; however, the rate of increase for most other categories was substantially lower. Only the rate of increased lending to Black and Latinx households exceeded the increase in the Rochester MSA as a whole. Between 2017 and 2020, CNB’s dollar volume of lending increased by:
- 103% in the city
- 176% among Black and Latinx households
- 110% among low-moderate income households
- 88% in low-moderate income census tracts
- 99% in nonwhite census tracts.
Except for lending going to Black and Latinx households and to nonwhite census tracts, the proportions of CNB’s dollar volume of lending going to other areas of the Rochester community was lower in 2020 than in 2017 (see bottom section of Table 3), and they are lower than the average proportions of all financial institutions (AFI).
Of the $345.5 million CNB originated in the Rochester MSA in 2020,
- 6% went to the city, compared to 8% in 2017, and 6% for AFI
- 3% went to Black and Latinx households, compared to 3% in 2017, and 7% for AFI
- 14% went to low-moderate income households, compared to 18% in 2017, and 20% for AFI
- 5% went to low-moderate income census tracts, compared to 7% in 2017, and 6% for AFI
- 2% went to nonwhite census tracts, compared to 2% in 2017, and 2% for AFI
CNB’s Home Purchase Lending
Home Purchase Loan Originations
We also analyzed CNB’s home purchase originations (1st lien loans on owner-occupied, (principal and secondary) 1-4 family site-built units). As can be seen by Table 4 in Appendix, CNB originated 1,060 home purchase loans in the Rochester NY MSA in 2020, an increase of 19% compared to 2017.
CNB’s home purchase lending in some areas of the Rochester community increased at rates greater than the 19% increase in the MSA while increases in other areas were not as large. Between 2017 and 2020, the number of home purchase loans originated by CNB increased by:
- 13% in the city.
- 32% among Black and Latino households.
- 31% among low-moderate income households.
- 11% in low-moderate income census tracts.
- 4% in nonwhite census tracts.
Despite increasing its home purchase lending in all categories of the Rochester community, the increases were not enough in most categories (except for the city) so that CNB matched the averages of all financial institutions (AFI) in the proportion of its loans going to borrowers in those categories (see bottom section of Table 4). Of the 1,060 home purchase loans made by CNB in 2020,
- 11% were in the city, compared to 11% in 2017, and 11% for AFI
- 5% were to Black and Latinx households, compared to 5% in 2017, and 11% for AFI
- 36% were to low-moderate income households, compared to 32% in 2017, and 39% for AFI
- 11% were in low-moderate income census tracts, compared to 12% in 2017, and 14% for AFI
- 5% were in nonwhite census tracts, compared to 5% in 2017, and 6% for AFI
CNB’s Mortgage Lending Compared to Its Peers
GRCRC believes in the importance of comparing the lending of a bank to its peers. As CNB is the 4th largest bank in the Rochester area, we compare its lending to the eight largest banks in the Rochester MSA. In 2020 CNB ranked 4th in deposits in the Rochester MSA, with almost 13 percent of the market, so these might be considered benchmarks as well.
Total Mortgage Lending Compared to Peers
Our first comparison is of the total number of mortgage originations by the top 8 banks (lst lien loans on owner-occupied (principal and secondary), 1-4 family site-built units). As seen on Table 5 in Appendix, CNB originated 2,643 mortgage loans in 2020, making CNB the top lender by far among the top 8 banks. CNB’s 10% Rochester MSA mortgage loan market share is somewhat lower than its 13 percent depository market share, but the bank’s 1st place ranking among the top 8 banks is higher than its 4th place depository market share ranking.
One way a depository can demonstrate its CRA commitment to a community is by maintaining market shares in the various target communities similar to or greater than its overall MSA market share (middle part of table). CNB matched its MSA total lending market share of 10% in the city, while market shares in the other categories fell short of its MSA market share, particularly among Black and Latinx households and in nonwhite census tracts. In 2020, CNB had:
- 10% of the market in the city, and ranked 1st among the top 8 banks.
- 5% of the market among Black and Latinx households, and ranked 2nd among the top 8 banks
- 8% of the market among low-moderate income households, and ranked 1st among the top 8 banks
- 8% of the market in low-moderate income census tracts, and ranked 1st among the top 8 banks.
- 7% of the market in nonwhite census tracts, and ranked 1st among the top 8 banks.
Despite its market shares in all but one of these categories being lower than its MSA market share, CNB still ranked 1st or 2nd in each of these markets among the top 8 banks.
CNB’s distribution of its total lending to the city matched the averages for AFI and the top 8 banks, while falling below both sets of averages for the other categories (bottom part of table).
Dollar Volume Lending Compared to Peers
In 2020, CNB made $551.4 million in mortgage lending in the Rochester MSA, capturing 12% of the market and ranking first among the top 8 depositories in the Rochester MSA. (See Table 6 in Appendix.) This is almost equal to its depository market share and far above its 4th place depository market share ranking.
Among Rochester’s various markets, CNB had a dollar volume lending market share of:
- 12% in the city, and ranked 1st among the top 8 banks.
- 6% among Black and Latino households, and ranked 1st among the top 8 banks
- 9% among low-moderate income households, and ranked 1st among the top 8 banks
- 10% in low-moderate income census tracts, and ranked 1st among the top 8 banks
- 9% in nonwhite census tracts, and ranked 1st among the top 8 banks
GRCRC is pleased that CNB’s dollar volume market shares in all the various markets exceeds its depository market share ranking. Still, except for the city, the bank’s market shares in these markets fell far short of its MSA lending market share.
Again except for the city, CNB’s distribution of its dollar volume of lending among the various Rochester community categories was less than the average distribution of the area’s top 8 banks and of all financial institutions.
Home Purchase Lending Compared to Peers
CNB made 1,060 home purchase loans (lst lien loans on owner-occupied (principal and secondary), 1-4 family site-built units) in the Rochester MSA in 2020. This corresponds to 9% of the market, making CNB the top home purchase mortgage lender among the top 8 banks in the Rochester area. CNB made three times as many loans in the MSA as the next two lenders, M&T and Lyons NB (See Table 7 in Appendix). CNB’s 9% of the MSA market is somewhat less than its depository market share, but its 1st place ranking is far above its 4th place depository market share ranking.
CNB’s home purchase loan market shares in several community categories were equal or similar to its Rochester MSA market share of 9%; its market shares for Black and Latinx households and nonwhite census tracts, however, fell short. CNB had a home purchase lending market share of:
- 9% in the city, and ranked 1st among the top 8 banks
- 5% among Black and Latinx households, and ranked 4th among the top 8 banks
- 9% among low-moderate income households, and ranked 1st among the top 8 banks
- 8% in low-moderate income census tracts, and ranked 1st among the top 8 banks
- 7% in minority census tracts, and ranked 3rd among the top 8 banks
Despite CNB’s 1st place market share ranking in several areas, the bank’s distribution of its home purchase loans to the above categories fell substantially short of the top 8 average distribution in every category. Moreover, only the distribution of its loans to the city met the average for all financial institutions.
Conclusion: CNB’s Mortgage Lending
GRCRC believes that traditionally underserved families and communities benefit more when they obtain mortgages from lenders with a local depository presence than from little-regulated mortgage companies or lenders with no local CRA obligations. It benefits both the borrower and the bank when borrowers develop additional financial relationships with their mortgage lender.
This is why GRCRC is pleased to see that CNB has such a strong presence in the Rochester area mortgage lending market, and that the bank is working to recruit more staff of color. Still, as we outline in the Community Development Opportunities section below, we believe that CNB can do better in serving our historically underserved and redlined BIPOC and low-moderate communities.
CNB SMALL BUSINESS LENDING
CRA Small Business Lending
Table 8 in Appendix shows CNB’s CRA small business loans and dollar volume of lending from 2017 to 2020. Note that the bank’s Paycheck Protection Program (PPP) loans are included in the numbers it reported in 2020. According to the OCC, these will be counted as small business loans in this exam. As the FFIEC’s CRA small business lending data was not out as of the time of our data analysis, Canandaigua NB provided us with their small business lending numbers for 2020, both including (Table 8) and excluding PPP loans (Table 8a). From this, we were able to calculate the number of PPP loans CNB reported (see Table 8b).
Number of Small Business Loans
CNB made 4,976 small business loans in the Rochester MSA in 2020, of which 3,871 were PPP loans (see Table 8b). As seen by Table 8, the PPP loans increased the bank’s lending by 3,664 loans or 279% from 2017. When the PPP loans are excluded, CNB’s lending decreased by 207 loans or 16% between 2017 and 2020 (see Table 8a). CNB also dramatically increased the number of small business loans to businesses in low-moderate income census tracts, loans of $100,000 or less, and loans of $100,000 or less to businesses in low-moderate income census tracts in 2020, the vast majority of which were PPP loans. Note that lenders were not required to collect gross annual revenue data on PPP loans, which depressed the numbers for loans to businesses with gross annual revenues under $1 million.
In 2020, CNB made (including PPP loans, Table 8):
- 956 loans to businesses in low-moderate income census tracts, an increase of 251% from 2017.
- 4,151 loans of $100,000 or less, an increase of 266% from 2017
- 775 loans of $100,000 or less to businesses in low-moderate income census tracts, an increase of 246% from 2017
- 678 loans to businesses with gross annual revenues under $1 million, an increase of 8% from 2017
- 123 loans to businesses with gross annual revenues under $1 million in low-moderate income census tracts, an increase of 14% from 2017
In 2020, CNB made (excluding PPP loans, Table 8a):
- 221 loans to businesses in low-moderate income census tracts, a decrease of 19% from 2017.
- 894 loans of $100,000 or less, a decrease of 21% from 2017
- 174 loans of $100,000 or less to businesses in low-moderate income census tracts, a decrease of 22% from 2017
- 548 loans to businesses with gross annual revenues under $1 million, a decrease of 13% from 2017
- 99 loans to businesses with gross annual revenues under $1 million in low-moderate income census tracts, a decrease of 8% from 2017
CNB compared favorably to all financial institutions (AFI) in 2019 in its distribution of small business loans to the different categories. Its distribution was greater than the average for AFI to businesses in low-moderate income tracts, loans of $100,000 or less to businesses in low-moderate income tracts, to businesses with gross annual revenues under $1 million, and to businesses with gross annual revenues under $1 million in low-moderate income census tracts. Its distribution of loans of $100,000 or less was less than the average for AFI, which, along with its medium average loan size, indicates that CNB does fewer credit card loans than several of the big banks in the area.
In 2020, CNB was able to maintain its distribution rates across the various categories while doing a substantial PPP business.
Dollar Volume of Small Business Lending
In 2020, CNB did almost $365.6 million in small business lending in the Rochester MSA, including $256 million in PPP loans (Table 8b). As seen at the bottom half of Table 8, this was a 254% increase from 2017. CNB’s dollar volume of small business lending also increased dramatically for loans of $100,000 or less and such loans in low-moderate income census tracts, and slightly less dramatically to businesses in low-moderate income neighborhoods.
In 2020, CNB made (including PPP loans, Table 8):
- $80.1 million in loans to businesses in low-moderate income census tracts, an increase of 189% from 2017
- $121.9 million in loans of $100,000 or less, an increase of 263% from 2017
- $24.3 million in loans of $100,000 or less to businesses in low-moderate income census tracts, an increase of 252% from 2017
- $47.5 million in loans to businesses with gross annual revenues under $1 million, an increase of 57% from 2017
- $8.8 million in loans to businesses with gross annual revenues under $1 million in low-moderate income census tracts, an increase of 34% from 2017
In 2020, CNB made (excluding PPP loans, Table 8a):
- $22.4 million in loans to businesses in low-moderate income census tracts, a decrease of 19% from 2017
- $34.2 million in loans of $100,000 or less, an increase of 2% from 2017
- $6.6 million in loans of $100,000 or less to businesses in low-moderate income census tracts, a decrease of 5% from 2017
- $40.1 million in loans to businesses with gross annual revenues under $1 million, an increase of 33% from 2017
- $6.5 million in loans to businesses with gross annual revenues under $1 million in low-moderate income census tracts, a decrease of 1% from 2017
CNB matched or exceeded all financial institutions in 2019 in every category of lending with respect to its distribution of its dollar volume of lending.
CNB and PPP Loans
The sharp increase in small business lending between 2019 and 2020 and the PPP loan numbers in Table 8b shows that CNB was able to take advantage of at least the first round of the Paycheck Protection Program and to serve local businesses during the beginning of the pandemic. One third of the bank’s PPP dollar volume of lending was for loans of $100,000 or less, and 19% of its PPP loans were to businesses in low-moderate income tracts. According to CNB, staff accepted PPP applications from both existing and new customers. GRCRC appreciates that CNB made 3,871 loans to support businesses weathering the first part of the pandemic, of which 735 were to businesses in low-moderate income tracts.
CNB’s Small Business Lending Compared to Peers
As with the mortgage lending, we compare a bank’s small business lending to its peers, the other depositories with the greatest market shares in the Rochester NY MSA. We compare their market shares for 2019, the most recent year for the public data. Table 9 in the Appendix compares the small business loans, dollar volume lending and market shares for the Rochester MSA’s top 8 banks for 2019.
Number of Loans Market Share
In 2019, with 1,217 loans, CNB captured almost 7% of the small business loan market in the Rochester MSA, making CNB the 2nd largest small business lender among the top 8 banks after JPMorgan Chase (a big credit card lender), in terms of number of loans. (See top part of Table 9.) CNB met or exceeded its overall MSA market share of 6.6% in loans to businesses in low-moderate income tracts, in loans to businesses with gross annual revenues under $1 million, and in loans to these smaller businesses in low-moderate income tracts. In 2019, CNB had a market share of:
- 7.9% among businesses in low-moderate income census tracts, making CNB 2nd among the top 8 banks
- 6.0% in loans of $100,000 or less, making CNB 3rd among the top 8 banks
- 7.1% in loans of $100,000 or less to businesses in low-moderate income census tracts, making CNB 2nd among the top 8 banks
- 7.3% among businesses with gross annual revenues under $1 million, putting CNB 3rd among the top 8 banks
- 8.3% among businesses with gross annual revenues under $1 million in low-moderate income census tracts, putting CNB 3rd among the top 8 banks
Dollar Volume Lending Market Share
In 2019, with $102 million in lending, CNB captured 14.9% of the dollar volume of small business lending in the Rochester MSA, making it the 2nd largest dollar volume lender among the top 8 banks after M&T. (See the bottom half of Table 9.) This dollar volume market share and rank exceeds its depository market share and rank.
CNB’s market share in dollar volume of lending in low-moderate income tracts and to businesses with gross annual revenues under $1 million exceeded its overall MSA market share, while its dollar volume market share among businesses with gross annual revenues under $1 million in low-moderate income tracts fell slightly short of its MSA market share. In 2019, CNB captured:
- 15.3% of the dollar volume of lending to businesses located in low-moderate income census tracts, placing CNB 2nd among the top 8 banks
- 12.9% of the dollar volume of lending for loans of $100,000 or less, placing CNB 2nd among the top 8 banks
- 15.2% of the dollar volume of lending for loans of $100,000 or less to businesses in low-moderate income tracts, placing CNB 1st among the top 8 banks
- 15.5% of the dollar volume of lending to businesses with gross annual revenues under $1 million, placing CNB 2nd among the top 8 banks
- 14.3% of the dollar volume of lending to businesses with gross annual revenues under $1 million located in low-moderate income census tracts, placing CNB 2nd among the top 8 banks
Note that in 2019, CNB’s average small business loan size was $84,010, the 5th largest average loan size among the top 8 banks. This is CNB’s largest average loan size among the years examined, except when the PPP loans are excluded in 2020 (see Tables 8 and 8a).
With respect to the distribution of its dollar volume of lending to businesses in low-moderate income communities, to businesses with gross annual revenues under $1 million, and to such businesses located in low-moderate income tracts, the percentages for CNB were only slightly lower than the averages for the top 8 banks (bottom of Table 9).
Small Business Lending Summary
In order to stabilize the economy, create jobs and build wealth in the Rochester community, area businesses need access to affordable, responsible credit. This has been especially true during the pandemic. GRCRC is pleased that CNB is the Rochester area’s 2nd leading CRA small business lender with respect to dollar volume. We applaud the bank’s ability to pivot during the pandemic to support current and new customers needing PPP loans, and that one-in-five PPP loans supported businesses in low-moderate income tracts.
As seen below, sole proprietorships and other micro-businesses, particularly Black and Brown-owned businesses, continue to struggle as a result of the pandemic. We urge CNB and its small business team to work with GRCRC member organizations already in relationship with local micro- and Black and Brown-owned businesses to provide additional support and technical assistance and to determine whether its products can work in the current economic climate.
CNB’s Reinvestment of Deposits into the Community, Response to Community Needs and Opportunities for Investment
CNB shared information with us about its local community development investments, grants and loans for 2018 through 2020.
In addition, several GRCRC members shared information with the bank and/or us on local community development needs, how CNB has worked with their organizations to address them, and suggestions on how CNB might help address emerging and ongoing needs.
Reinvesting Deposits into the Community
CNB reinvested a total of $613.5 million in CRA-eligible loans, grants and investments in the Rochester community between 2018 and 2020, the current CRA exam period. As seen in Table 10 (Table 10a) in Appendix, this included:
- $89.9 million in community development loans and investments and CRA-eligible grants serving primarily low- and moderate-income families, individuals and communities
- $299.5 million in mortgage loans to low-moderate income households and/or in low-moderate income census tracts
- $224.2 million in CRA small business loans to businesses in low-moderate income tracts and/or to businesses with gross annual revenues under $1 million
According to the information provided by the bank, CNB reinvested:
- $66.7 million in community development lending in the Rochester NY MSA
- $22.7 million in community development investments in the Rochester MSA
- $0.47 million in CRA-eligible grants/donations (Not included here is $200,000 in FHLBNY grants; while CNB hosted the program, the bank did not use its own funds to supply the grants.)
Again, CNB invested a total of $613.5 million in the Rochester MSA during the current exam period.
During our meeting with the OCC, it was noted that many banks are holding an excess of deposits in 2020 due to COVID stimulus money paid to municipalities and individuals. Therefore, we are basing our calculations of how much of its deposits CNB is reinvesting in the community on both its 2019 and its 2020 deposits. CNB had $2.3 billion in deposits in 2019 and $2.9 billion in 2020.
No matter which year we used for deposits, CNB consistently increased the proportion of its deposits the bank reinvested in the Rochester community over the four exams for which we did calculations.  Taking the $2.3 billion on deposit in 2019, we estimate that CNB reinvested 26.2% of these deposits into the Rochester community during the entire 2021 exam period, for an annualized average of 8.7%. Using the $2.9 billion in deposits in 2020, CNB reinvested 21.3% during the 2021 exam period, for an annualized average of 7.1% (See Table 10, Table 10b.)
Table 10c shows that no matter the year used for deposits, CNB’s growth in its dollar volume of reinvestments in the Rochester community grew at a substantially higher rate than its growth in deposits. Across the four exam periods, CNB increased its reinvestments by 490% to this exam period’s $614 million, while its deposits grew by 113% through 2019 or by 162% through 2020.
Which year of deposits we use affects how well CNB’s growth in its annualized percentage of deposits reinvested in the Rochester community compares to its growth in deposits over four exam periods. When using the 2019 deposits, CNB’s annualized percentage of deposits reinvested increased by 178%, while deposits grew by 113%. When using the 2020 deposits, the rate of growth in CNB’s reinvestments is somewhat less than its growth in deposits. CNB’s annualized percentage of deposits reinvested increased by 127%, while deposits grew by 162%.
GRCRC is very pleased with CNB’s consistent increase in its dollar volume of reinvestments in the Rochester community and its annualized percentage of deposits reinvested over the four exam periods reviewed. As seen by Table 10c, CNB’s investments have grown from $104 million during the 2007 exam to $614 million during the current exam, an increase of almost 500%.
One area of concern is the level of grantmaking and donations. CNB’s $469,000 in CRA-eligible grants and donations made between 2018-2020 is less than 0.1% of the bank’s total dollar volume reinvested in the Rochester community. We believe that the Rochester area’s 4th largest bank can do better.
GRCRC asks that, as the bank continues to open new branches and expand its footprint, CNB continue to engage with coalition members and other entities in the community in order to find additional ways to continue growing its lending, investments and grants.
Specific Community Development Activities
CNB staff and GRCRC members shared with us the following community development activities that CNB is currently supporting.
Responding to the COVID-19 Pandemic
At our meeting in September, CNB shared with the coalition that, in addition to processing $526 million in Paycheck Protection Program loans to 6,864 businesses, the bank provided deferment assistance to 18% of its loan portfolio (commercial and consumer), which comprised of 6,955 accounts, the majority of which were indirect consumer loans.
CNB also noted that it had a COVID small business grant.
Abusive Auto Lending
In Rochester, working families need cars to get to work. Work schedules are not fixed and change at the last minute. Entry level jobs are in locations that don’t have reliable public transportation or affordable housing.
For individuals in rural areas, public transit is not even an option. This makes Upstate New York a haven for subprime auto lenders and unscrupulous “Buy Here Pay Here” dealers who know that most of these individuals would not be able to get an affordable loan from a bank.
Car loans have abusive and discriminatory interest rates, so that loans have high loan‐to‐value ratios ranging from 125‐175%. Long loan terms mean that the car stops running before the loan is paid. The dealer then refinances the amount of the unpaid loan into a new loan. That leads to higher and higher loan‐to‐value ratios.
Legal Assistance of Western New York (LawNY) is the primary free legal service provider in 13 of the 14 counties in the Rochester MSA and the rural counties in the Finger Lakes. LawNY turns away hundreds of callers each year seeking help with consumer legal problems. Staff members see hidden fees for the dealership, and costly, yet worthless, extended warranties added to the contracts without the consumer’s knowledge. It is not uncommon for a consumer to buy a used car with over 100,000 miles on it that was advertised at a number around $5,000. That consumer will end up with a loan that will cost them more than three times that amount by the time they are done making payments.
The pattern LawNy has observed is that most consumers are not even made aware of the terms of the loan at the time they purchase the car. The majority of documents are signed on a computer, by clicking a button that is often controlled by the salesperson. Frequently consumers leave the lot with their car but not their contract. When they finally do receive the contract, they are shocked to learn that the car they purchased will cost them more than twice what they were told by the dealer. Because there is no cooling-off period for car sales, consumers are left with no recourse to return the car after learning it is unaffordable, and dealers will often direct consumers to the company that indirectly financed their loan, even though the consumers have only ever interacted with the dealer.
All of this results in extremely high default rates–25% for subprime auto loans made at “Buy Here Pay Here” dealerships, compared to only 1% default rates for low-interest auto loans made by traditional banks. When individuals default on their auto loans, the lender will repossess the vehicle and auction it off for a fraction of the fair market value. In most instances, this leaves a large deficiency balance on the loan that the lenders will pursue in the courts by filing lawsuits against the consumers, again increasing what the loan costs by adding attorney’s fees, court costs, and post-judgement interest. Without access to legal representation, many of these lawsuits result in default judgments against the consumers, even when there are legal defenses. Consumers will then end up paying for these cars for years after they surrendered them and for thousands of dollars more than they were ever worth. This results in a cycle of subprime credit that is almost impossible to break.
Subprime used auto credit makes it virtually impossible to become a homeowner and take the first step into saving to build assets and wealth. The previous administration eroded protections for consumers, and until the new administration gets its appointees in place, we need continue to find ways to shut down predatory and abusive used car loans.
Some state regulators have acted, such as Massachusetts Attorney General suing one of the largest subprime lenders, Credit Acceptance Corp (CAC). Still an August 2020 Wall Street Journal article that describes the problems with securitized subprime auto loans suggests that the investors will not lose out.
During our two meetings, CNB explained its auto lending program. CNB utilizes Equifax Beacon 9.0 as a scoring model. Credit scores of 660 and below are considered sub-prime. The bank’s business model is such that it can carry a reasonable percentage of its monthly volume in this category, while still adhering to an appropriate level of safety and soundness. CNB understands a that reliable vehicle is pertinent to an individual’s livelihood, and recognizes that people experience challenging financial situations, which can reduce their credit score. The bank works directly with the dealers to facilitate a rate and term that is affordable and appropriate for each borrower. In all instances all dealer markup is limited to a maximum of 2.5%. GRCRC is grateful that CNB has an indirect auto loan program that assures safe and affordable loans to subprime clients via the dealer.
In addition to offering safer, affordable auto loans for consumers, we ask that CNB also consider funding LawNY and/or other legal services programs to assist borrowers deceived by predatory lenders.
CNB has been a long-time supporter of and participant in the first-time homebuyer programs of The Housing Council at PathStone.
CNB directly impacts the benefit package of Ibero-American Action League Inc. (IAAL) by servicing the agency’s 403b employer retirement account. In addition, the first round of SBA’s PPP loan program was serviced through CNB, a critical financing tool for the agency during the early stages of the pandemic. These banking services are an open door for Ibero to consider more banking services with CNB, thus impacting a diverse staff at Ibero and its subsidiaries. CNB will also start giving IAAL general operating support in 2021. We thank CNB for its past and future support of IAAL.
During our meetings, CNB shared that it has:
- Contributed $25,000 to the Venture Jobs Foundation
- Made two donations to LawNY
- Supported the credit repair work of Consumer Credit Counseling Service of Rocheter (CCCS)
- Staff on the Venture Jobs Foundation loan committee
- Staff that participated on the Commission on Racial and Structural Equity (R.A.S.E.)
- Donated to the Antiracist Curriculum Project of the PathStone Foundation
- An internal diversity, equity and inclusion committee that is trying to recruit people of color
GRCRC thanks CNB for its contributions and work on these initiatives. We are especially grateful for its support of projects and work in addressing system racism. As seen below, addressing vestiges of historical redlining is critical work that is directly related to the purpose of the Community Reinvestment Act.
Community Development Opportunities
GRCRC members share with us the needs in the Rochester community and initiatives, programs and needs of the member organizations. We then include these as opportunities in our comment letters as possible investment opportunities for the banks. We understand that each bank will not be able to invest in all these opportunities. At the least, we ask that banks consider these on-the-ground perspectives when making decisions about products, investments and contributions so they can more effectively address the needs of the Rochester community and support low-moderate income and BIPOC communities.
Structural Racial and Income Inequality in Upstate New York
The CRA was passed in 1977 to address the decades of redlining that had been happening in our communities. While the law says banks should serve the entire community in which they do business, including low- and moderate- income (LMI) communities, redlining mainly happened in, and continues to happen in and impact, Black and Brown communities. This is why banks must make decisions about their CRA-related lending, investments and grants through the lens of racial equity, as well as economic equity.
As in the rest of the nation, there is much work to be done in New York to come to terms with our history and to address the structural racial and income inequality. We need to look at the laws and economic policies that perpetuate structural racism and keep communities segregated. We also need structural change to ensure that jobs pay a living wage. New York State must develop and foster an environment where affordable housing, health care, and quality childcare are a reality for all people.
At the institutional level, banks must shift policies, practices and culture to align with racial equity, anti-oppression, and cultural humility. While we appreciate that CNB has a DEI Committee and is working to recruit people of color, the bank will not be able to retain BIPOC staff unless it does the deeper cultural change work. This includes work to:
- Become welcoming for all people particularly those who have been historically, and continue to be, marginalized
- Assure employees, from the CEO down to staff underwriting loans, and those working with the public, are doing internal and interpersonal work (including implicit bias training) to address internalized racism and other forms of oppression
- Find ways to go into the community to create ease/support for BIPOC and Black and Brown-owned businesses.
A Brookings’ paper shares how private sector leaders can significantly move the needle towards racial equity and an equitable economy via a 3-part framework:
- Adopt internal changes within individual companies to promote diversity, equity, and inclusion.
- Act collectively with other CEOs to make regionwide progress on racial equity and equitable growth, including improving key regional performance indicators.
- Encourage business-led civic organizations to adopt their own changes toward equity and inclusive economic growth.
The paper also includes links to data metrics to measure progress at the MSA level. We urge CNB’s leaders to continue its work with other local private sector leaders and groups from the RASE Commission by bringing them together to implement this or a similar framework in the Rochester community.
In addition to this internal and collaborative racial equity work and the bank’s support of community racial justice initiatives, CNB can take other constructive actions to support BIPOC people, businesses, and communities. CNB can:
- Start tracking how much of its CRA related activities and support (lending, philanthropy, and community development loans and investments) goes to BIPOC people, businesses and organizations led by people of color, and BIPOC communities, and create specific goals to increase these levels of support over time.
- Partner with and/or support BIPOC-led organizations, particularly smaller/micro organizations, that CNB has not worked with in the past, including through investments, grants, and hiring local BIPOC-led vendors for supplies and services.
- Learn about the history of redlining in the Rochester area and work with the Black and Brown residents of the impacted neighborhoods to address the vestiges of redlining and to build wealth and equity in ways that do not push-out lower income residents.
New research from the University of Houston highlights the intersections of race and advertising. The results underscore the power of advertising and access on behavior. We hope CNB will find this research helpful as the bank continues its work in Black and Brown communities.
Responding to the COVID-19 Pandemic
Upstate New York had still not fully recovered from the financial crisis of 2008 when COVID-19 struck. It is now clear that Black and Brown and lower-income communities are disproportionately suffering from the pandemic and its economic impacts. Empire Justice published an article last fall showing that systemic racism, of which redlining is just one manifestation, created the conditions that lead to today’s racial inequities in health outcomes, including the higher rates of COVID-19 cases and deaths of African-American and Latinx people and in Black and Brown communities.
It is also clear as we come out of this pandemic that homeowners, renters and small businesses will continue to be negatively impacted from the economic fallout of pandemic shutdowns, unemployment and reopening restrictions.
On January 15, 2022, the New York State eviction moratorium will come to an end. This will be followed by a wave of evictions, in which a large percentage of people who rent may become homeless or lose their housing stability. Evictions have been on hold for months during the COVID-19 pandemic, but rental payments have not.
An average of more than 8,000 evictions are filed in Rochester each year – six times the national rate. Historically, fewer than 10% of tenants have access to an attorney during disputes with their landlords, but the horizon is more hopeful today than it was earlier in the pandemic. The NYS Legislature recently approved a $3.5 million tenant defense fund for upstate cities, of which over $800,000 will be for the Tenant Defense Project, jointly run by Rochester’s legal services community in the Telesca Center for Justice to provide tenants free access to attorneys in eviction cases. We ask CNB to work with Tenant Defense Project to determine how the bank might best support the project to keep tenants in safe, affordable housing.
Debt collection activities and cases are on the rise. While the composition of debt over the years has generally stayed the same, overall debt has increased. Mortgage debt has increased each year since 2015, as have auto loan, credit card and student loan debt, which are the largest sources of debt. Debt collection judgments have long-term negative impacts on credit and wealth building.
In addition to helping consumers with predatory auto loans (see above), LawNY also handles debt collection cases. The organization is averaging 13 new collection lawsuit intakes a week, which is more than double what is typically seen. LawNY is also getting more and more calls from people the organization has had to turn away for help because they are a few hundred dollars over the income limits. LawNY needs more unrestricted funding sources, so it can represent more individuals in these cases. We urge CNB to also consider supporting this work of LawNY.
Economic Development and Work Force Development
Ibero-American Investors Corporation DBA Ibero Business Center (IBC), a subsidiary of IAAL, has been around since 1979 providing micro-loans to minority and women owned enterprises. Today IBC manages offices in Buffalo and Geneva providing business courses and technical assistance for start-ups and businesses seeking to go on to the next level of their enterprises. In Rochester, IBC handles a pool of available loan money for micro financing in economically depressed regions such as the North Clinton Ave Corridor. La Avenida, as it is often referred by the Latino(a) population, is home to the La Marketa at the International Plaza. IBC currently supports vendors in this small marketplace with financing and technical assistance to increase the chances of success and eventual growth even outside of La Marketa. CNB can partner with IBC in providing financing (through low interest loans or grants) for helping start-up businesses in La Marketa.
IBC also partners with the main Spanish speaking radio station, Poder 97.1, a division of IAAL, by providing radio ad space and promoting new businesses to a Spanish speaking audience. CNB can partner with IAAL in providing funding to expand the Poder 97.1 radio signal to reach Latinos(as) outside of the City of Rochester and into the suburbs of Rochester.
CNB can also partner with the City of Rochester and Ibero-American Development Corp, a subsidiary of IAAL, in providing funding for expansion of La Marketa renovations to include more spaces for vendors for the coming season of La Marketa starting in April 2022. GRCRC urges CNB to consider these opportunities to invest in small business development with these subsidiaries of Ibero.
The Southwest Quadrant Street Liaison Office of the 19th Ward Community Association has been promoting COVID-19 financial assistance programs since the beginning of the pandemic to small businesses in southwest Rochester, most of which are Black and Brown. The SW Street Liaison Office is deeply connected to, is trusted by, and understands the small business community in this neighborhood. Staff know that working with Black and Brown-owned businesses is more than altruism; it is about building relationships and acting from the perspective of opportunity. The office has relationships with about 400 small businesses in the neighborhood, very few of which have closed permanently due to the pandemic.
The great majority of businesses in the SW Quadrant are surviving the pandemic financial stress due to a combination of grants administered by the City of Rochester, grants administered by nonprofits, and Paycheck Protection Program (PPP) loans from a few banks that were fully compensated for their administrative costs. More recently a few entities, including Monroe County Fast-Forward and ESL FCU, have stepped up with grants for businesses that showed a 20 to 25% reduction in revenue for 2020 vs 2019.
GRCRC urges CNB to partner with the SW Street Liaison Office to find out how best to support its work and the businesses in the area, particularly Black and Brown-owned businesses, and the area’s smallest businesses.
The PathStone Enterprise Center, Inc. (PECI) is a non-profit, 501(c)(3) regional Community Development Corporation organized in 1997 and certified as a Community Development Financial Institution (CDFI) in 1998. PECI is the economic development and lending arm of PathStone Corporation with a service area that includes upstate New York between Buffalo and Syracuse and the western half of Puerto Rico.
PECI has made an aggregate of 1,348 loans totaling $30.6 million, while leveraging an additional $26.2 million in private funding, and PECI currently has assets of approximately $13,000,000. The small business loan segment of the portfolio has resulted in over 2,600 jobs created or retained in New York and Puerto Rico. PECI services all of its own loans and PECI’s current small business portfolio includes over 175 loans with outstanding balances totaling over $7,200,000.
PECI is capitalized by a variety of government and private funds. PECI is a Micro Lender for the SBA and USDA. PECI has received loan and grant capital from New York’s Empire State Development that it uses for relending. In addition, PECI has received Program Related Investments (long term low interest loans or grants) from six financial institutions and three foundations for the purpose of making loans that they are unable to make in their service areas. These capital funds in the form of long-term, low interest rate loans as well as operating grants are critical for CDFIs that are providing loans and technical assistance to businesses that are unable to get funded through traditional lenders. In addition to its support of The Housing Council at PathStone and the PathStone Foundation, GRCRC asks that CNB consider providing such loans or grants to PECI, another arm of the PathStone Corporation.
The mission of the Urban League of Rochester, Inc. (ULR) is to enable African Americans, Latinos, the poor and other disadvantaged to secure economic self-reliance, parity and power, and civil rights. ULR has been providing workforce development programs since 1967 and serves individuals with intersectional needs who face multiple barriers to employment and self-sufficiency such as substance abuse, involvement with the criminal justice system, low literacy levels, absence of a high school diploma, lack of adequate child care and transportation, and other issues associated with systemic and concentrated urban poverty. Many of these challenges disproportionately affect people of color and low-income individuals due to historical inequities and racial discrimination such as but not limited to, racial profiling, poor distribution of resources and capital investment, and redlining and housing segregation. These disparities affect the individuals in ULR’s workforce development programs and emphasize the importance of basic needs being met as well as service provision including direct assistance, referrals, and connection to resources, that is also intersectional.
ULR currently has four workforce development programs. YouthBuild provides comprehensive services to disadvantaged youth ages 18-24. The program is recognized by the NYS Department of Labor as a Direct Entry Provider for apprenticeship programs. It provides hands-on construction and advanced manufacturing training using the Pre-Apprentice Certificate Training (PACT), Certified Production Technician Training, TASC (high school equivalency) preparation, case management, job readiness training, job placement, personal development, and follow-up activities. ULR’s Navigator program provides disconnected youth aged 17-21 with support and advocacy services to help them successfully attain a high school degree or equivalent, improve educational and occupational skills, and transition to post-secondary education or employment. In addition, ULR operates two U.S. Department of Labor funded programs – Project BEAM, a reentry program for adults aged 25 and older and Project Steps to Success, a reentry program for justice system involved young adults aged 18 to 24. Both programs help individuals successfully re-enter society by addressing their barriers and helping them attain the employment skills required to enter current in-demand occupations. GRCRC asks CNB to work with ULR to find the most effective ways to support its workforce development programs.
Over 5.7 million people living in New York speak a language other than English. Of these, 2.5 million speak English less than well (i.e., they have Limited English Proficiency (“LEP”)). Monroe County has a population of 741,770, of which 103,800 or 14% speak a language other than English at home (US Census Population Estimate, 2015-2019). This includes many Spanish-speaking American citizens who relocated from Puerto Rico to Monroe County after Hurricane Maria in 2017. Rochester also has a significant population of refugees who speak Arabic, Nepali, Somali, and Swahili. And Rochester has the largest concentration of Deaf and hard of hearing residents in the country.
The need for language access for bank customers in our community is great, including the need for in-language access to products such as mortgages and consumer loans, as well as language access for consumers with mortgage delinquencies and facing foreclosure who need forbearances or loan modifications. Perhaps no population faces greater challenges in obtaining information about available mortgage relief than LEP borrowers. Without access to better banking options, individuals in the LEP and the Deaf or hard of hearing communities also are at greater risk of predatory lending.
Since the last recession Empire Justice Center has represented homeowners with foreclosure prevention and supported not-for-profit organizations throughout New York State. Based on its statewide and national work, Empire Justice identified patterns where foreclosure support organizations took advantage of unsophisticated homeowners in default. Many LEP borrowers who spoke no English and were new Americans were vulnerable to organizations that targeted them. Banks must serve LEP borrowers in-language to help them protect their scarce assets and wealth.
At our September meeting with CNB, the bank shared that it now uses TransPerfect translation services for those needing language translation or ASL interpretation at its branches or call-in center. TransPerfect offers live, in-person translation of 171 languages, as well as video capability for ASL interpretation. CNB also shared that it is working to increase multi-lingual capability at its branches, especially for the Deaf and hard of hearing community near its Henrietta/RIT branch. We appreciate that CNB is working to increase language accessibility for customers who call or walk into branches.
Marlene Cortés of Empire Justice and the Monroe County Language Access Coalition noted that drive-throughs are not accessible for people who are Deaf and hard of hearing.
We urge CNB to continue improving language access by:
- Including Spanish and other languages on its website, with in-language pointers on its home page to those translated pages and to TransPerfect.
- Finding a way, possibly with TransPerfect, to increase accessibility of its branch drive-throughs.
- Providing cultural sensitivity training with respect to people who are Deaf and hard of hearing, speakers of other languages, and immigrants/refugees.
- Providing in-language product information for mortgages, auto loans, other consumer loans, and checking accounts.
- Supporting the Monroe County Language Access Coalition, a group of not-for-profits that serve LEP and Deaf and hard of hearing residents. The coalition is working on a community needs survey. CNB can support this survey and the other work of the coalition.
Climate Change and a Just Transition
In 2019, NYS adopted the country’s most ambitious climate targets–to have 100 percent carbon free electricity by 2040 and have economy-wide, net-zero carbon emissions by 2050. We need massive investments to make this happen, and we need to make sure it is a just transition, where, at a minimum, poor communities and communities of color are not disproportionately burdened or harmed.
The Climate Solutions Accelerator of the Genesee-Finger Lakes Region has ideas for how banks can support this very heavy lift. CNB can:
- Provide low-cost home improvement or refinance loans and other innovative financing products to people of color and low-moderate income households and tenant occupied buildings to make home energy efficiency projects more affordable and feasible. This will allow owners to weatherize, get heat pumps and electric furnaces and hot water heaters, to put in electric car chargers, and to install solar panels, which will reduce energy costs, decrease families’ carbon footprints and improve indoor air quality.
- Provide affordable financing for small businesses, particularly micro-businesses and Black and Brown-owned businesses, that want to improve their energy efficiency and reduce their reliance on fossil fuels.
- Develop community development financing goals and products to support projects that provide substantive opportunities for low-moderate income communities to benefit from the transition to renewable energy and reduce their use of fossil fuels, e.g. community solar, district geothermal.
- Invest in renewable energy, including geothermal, solar, wind, battery storage and other building energy efficiency investments, along with clean energy workforce development to support the growing demand of this transition.
- Require or strongly encourage borrowers to include energy upgrades in their renovation projects, especially for multifamily buildings that require major renovations.
- Include information about energy upgrades (and corresponding energy bill savings) and/or referrals to relevant energy programs as part of homebuyer/financial education programs.
- Provide philanthropic support to nonprofit organizations that are working to address environmental justice/climate justice and climate change.
- Reduce the bank’s own carbon footprint.
GRCRC urges CNB to work with Climate Solutions Accelerator on implementing these much-needed initiatives.
As a partnership between the City of Rochester and CCCS of Rochester, the Rochester Financial Empowerment Center (FEC) Program officially launched in February of 2020 shortly before the COVID pandemic lockdown. Through support from various funders, the program offers free, professional, one-on-one financial counseling as a public service. The FEC is an evidence-based model that was established by the Cities for Financial Empowerment Fund and has been replicated successfully in more than a dozen cities across the U.S. By integrating financial counseling into existing community services, the FEC connects with clients as they navigate existing programs. This has shown to produce increased outcomes for clients who are working towards economic independence including improved credit scores, decreased debt, and increased savings. Additionally, the integration of FEC counseling has bolstered other outcomes that partner organizations are seeking to achieve for their clients such as reducing recidivism.
Even amidst the COVID crisis, the existence of the program has demonstrated both a deep need for financial counseling as well as demonstrable outcomes that participants achieve. To date the Rochester FEC has engaged over 2,000 clients providing over 4,400 counseling sessions while achieving 1,092 outcomes. In total, participants have worked to increase savings by $1,057,337 and reduce their debt by $879,565. This is incredibly telling given the average FEC client has a median household income of $29,115 and non-mortgage debt of $35,000 while possessing savings of only $200. As the FEC program heads toward its third year of operation beginning February 2022, attention is being given to the development of sustainability for year four and beyond. As with most FECs, the vision is to build a foundation of both public and private funds to diversify opportunities. Given that the FEC delivers so strongly in areas that are crucial for financial institutions to meet CRA requirements (i.e. improved access to credit and banking products), we ask that CNB financially support the FEC program year four and beyond.
As seen on their website,
Flower City Noire Collective was founded in Rochester in 2016 by Tonya Noel Stevens and Kristen Walker. They founded FCNC specifically as a corrective to the transphobia, classism, and elitism they witnessed in existing mainstream activist movements, and to cultivate practices of self-care, accountability, and radical honesty. Stevens has formal training in Agriculture and Food Studies, while Walker has formal training in African American Studies and English. In addition, they have both developed extensive expertise in Black feminism and community-organizing through their work together since meeting in 2014. FCNC’s mission is to “elevate womxn of color,” and to center the experiences of Black queer folks in particular. According to their mission statement: “FCNC seeks to fill the void of safe, black centered spaces in Rochester, NY that center around black joy, black love, and understanding.” In the words of Walker, the work is fundamentally about “space-making.” Rooted in Black feminist politics and the Black radical tradition, FCNC emphasizes “the values of collective leadership, collective work and responsibility, collective education, and sustainability through skill-sharing.” Their interventions include a free Black feminist mentoring program for local youth called “Petals,” cultivation of green space for and with Black urban growers (B.U.G.S.), regular reading groups and other consciousness-raising efforts including a reading and discussion group, and most recently the founding of NOIRE House at the corner of Flower City and Dewey Avenue on the city’s predominantly Black west side in 2019. NOIRE stands for Neighbors Organized with Imagination for Resilient Emergence and is based on the model of Hope House in Detroit, which Stevens and Walker visited in 2017. NOIRE House is actually two houses, acquired by FCNC as “legacy properties.”
In Fall 2021 FCNC acquired a property on West Ave in the City of Rochester. Stevens and Walker are currently seeking grant funding–to update the property, to create a community of change makers, and to serve the young adults and families they work with. GRCRC urges CNB to consider providing unrestricted financial support to this transformative initiative.
M&T Bank has opened a multicultural branch in Buffalo. We encourage CNB to work with GRCRC and the Monroe County Language Access Coalition to explore this concept for one of CNB’s branches.
The COVID-19 pandemic and its impact on the economy have revealed economic and racial disparities in the Rochester community that those with structural power have hidden or refused to acknowledge for decades. Like many other cities across the country, we are starting to understand how structural racism and economic inequality have divided our community and disproportionately harmed Black and Brown communities, while ultimately harming us all. Like all financial institutions in this country, CNB is part of and has benefitted from these systems.
In addition to understanding structural racism and economic inequality and working to create more equitable systems, it is critical that CNB, and all financial institutions, focus reinvestments on the reduction of greenhouse gas emissions and addressing the disparate impacts of climate change on BIPOC and lower-income communities. The Intergovernmental Panel on Climate Change concluded from its most recent report that “unless there are immediate, rapid and large-scale reductions in greenhouse gas emissions, limiting warming to close to 1.5°C or even 2°C will be beyond reach.”
GRCRC urges CNB to focus more of its reinvestments on addressing these critical issues of our time; in particular, we ask that CNB increase the level of its grants to support organizations already in the community working on racial and economic justice and climate change.
As seen by Table 10c, this is at least the 4th CNB CRA exam on which GRCRC has commented. Since that exam in 2007, CNB’s deposits in the Rochester MSA have grown by 162% to $2.9 billion, so that as of 2021 the bank has almost 13% of the depository market. CNB’s annualized percentage of deposits reinvested has also grown—from 3.1% in 2007 to 7.1% (using the 2020 deposits) or 8.7% (using the 2019 deposits), increases of 127% or 178% respectively. Some of the increase in reinvestments this exam period can be explained by CNB’s increased mortgage and small business lending, especially in mortgage refinance and PPP loans. Still, there is room for improvement in CNB’s mortgage lending to low-moderate income families and census tracts and to communities of color. CNB’s internal equity work and recruiting of more employees of color should improve its lending in these areas.
GRCRC is committed to fostering productive relationships with all financial institutions in the belief that the goal of meeting the credit needs of communities harmed by structural racism and economic inequality is compatible with safe, sound, and profitable lending practices. That is why we have provided a variety of opportunities and strategies in this letter for CNB to consider.
GRCRC members look forward to continuing to work with CNB to find ways to invest in the Rochester community that will have the most benefit on community members and businesses that have historically been redlined and continue to be harmed.
Ruhi Maker, Esq.
Barbara van Kerkhove, Ph.D., Researcher/Policy Analyst
Shawnta Mack, OCC
Christian Imkeller, OCC
Steve Martin, CNB
Brian Pasley, CNB
Sheila Green, CNB
Appendix: Tables 1-10
 Our most recent analyses are “#AllTogetherNow: Improving Small Business Lending in the Rochester NY Community” (found at: https://empirejustice.org/wp-content/uploads/2018/01/alltogethernow-s.pdf) and “Too Big to Fail…Too Poor to Bank: How Mainstream Financial Services Can Help Low-Income Working Families Succeed” (found at: https://empirejustice.org/wp-content/uploads/2018/09/Access-to-Credit-Report-2018-FINAL.pdf).
 From the FDIC Market Share 2020 Report, as found at: https://www5.fdic.gov/sod/sodMarketBank.asp?barItem=2
 As found at https://www7.fdic.gov/sod/sodMarketBank.asp?barItem=2 for the Rochester MSA for each year.
 For the earlier exams, we used the FDIC market share deposits as of June 30 of the last year of the exam. Due to the unusual nature of deposits as of June 30, 2020, the last year of the current exam, we also look at the deposits for June 30, 2020.
 Hawkins, Jim and Penner, Tiffany, “Advertising Injustices: Marketing Race and Credit in America,” (September 15, 2021). Emory Law Journal, Vol. 70, No. 1619, 2021, Available at SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3924970.
 See Heather McGhee. 2021. The Sum of Us: What Racism Costs Everyone and How We Can Prosper Together.
 For more on how the financial system has benefitted from structural racism and other forms of oppression, see: Take on Wall Street, “To What Extent Was Our Economy Designed to Be Fair?” at: https://isoureconomyfair.org/.