To: Office of the Comptroller of the Currency From: Steven Sugarman, President and Chief Executive Officer Date: Monday June 9, 2014 Subject: Los Angeles Community Outreach Meeting Minutes Location: Radisson Hotel - Whittier, CA Purpose of Meeting To begin and/or continue a robust dialogue with community leaders and stakeholders. The bank s goal is to understand from each organization their respective priorities and specialized view of the needs of the communities that are jointly served by each respective organization and the bank. The bank seeks input into its community development activities and has pro-actively reached out to wide range of organizations throughout its market service area to ensure its community development plan reflects the voices of a diverse range of community organizations and leaders within the communities it serves. Banc of California Representatives Steven A. Sugarman, President and CEO Neal Mendelsohn, Senior Vice President, Chief Marketing Officer Gary S. Dunn, Senior Vice President, Community Development Officer J. Francisco A. Turner, Managing Director, Financial Institutions Bank Gaylin D. Anderson, Executive Vice President, Chief Community Banking Officer Heather Endresen, Senior Vice President, SBA Lending Jaime Haver, CLP, Lease Funding Manager of Commercial Equipment Finance Jim Fraser, Senior Vice President, Director of Construction and Renovation Lending Chris Garcia, CRA Project Manager Community Organizational Representatives Name Title Organization Liz Buckingham Incoming President Rotary International Santa Fe Springs Yasmin Davidds CEO Women s Institute of Negotiation Ritchie Geisel President, CEO Bienvenidos Childrens Center Cynthia Gutierrez Manager of Corporate Relations & Individual Giving MALDEF
Name Title Organization Martice Mills Director of Business Development Clearinghouse CDFI Mari Riddle President, CEO Centro Latino for Literacy Frank Tamborello Executive Director HungerAction Los Angeles Ana Lopez Staff Watts/Century Latino Organization Pedro Gutierrez Foreclosure Prevention Counselor Watts/Century Latino Organization Anna Sauceda President National Latina Business Women Association - Los Angeles Darrel Sauceda CEO ACS Group Paulina Gonzalez Executive Director Community Reinvestment Coalition Theresa Martinez CEO Los Angeles Latino Chamber of Commerce Vernon Aguirre Branch Manager Popular Community Bank Cora Oriel Board Chair National Asian American Coalition (NAAC) Sandwich buffet at 11:30pm Meeting formally opened at 12:00 pm (Steven Sugarman) Introduction PowerPoint Presentation (Steven Sugarman) 25 minutes Key Points from Banc of California PowerPoint presentation by Mr. Steven Sugarman Explanation of Organizational Mission and Vision Overview of Management Team Primary Focus on Building California s Bank Franchise Overview Highlights of Community Development Efforts Recent Community Development Activities Commitment to Volunteerism Diverse and Broad Group of Advisors Participation in the following boards: National Asian American Coalition Christ Our Redeemer AME Church of Irvine in Orange County The Ecumenical Center for Black Church Studies The Orange County Interdenominational Alliance representing Black, Latino and Asian American pastors in the Los Angeles, San Diego and Orange counties The Jesse Miranda Center for Hispanic Leadership - 2 -
The Los Angeles Latino Chamber of Commerce and California s leading pan Asian American HUD-approved home counseling and advocacy organization Introduction of Key BoC Executives 10 minutes Jim Fraser Remarks (Highlights) Banks, credit unions, mortgage bankers, realtors and other real estate professionals under serve borrowers by not supporting FHA and FNMA rehab loan programs Banc of California and RenovationReady are specifically focusing a business unit, staffed by subject matter experts, to execute these programs Unique features in these loans, supports FHA borrowers with limited down payments to access AND rehab distressed properties FHA 203K allows has additional unique feature Non-profits are eligible borrowers No FHA 203K loans have been made to Non-profits for 2 years. Heather Endresen Remarks (Highlights) Ms. Endresen joined Banc of California in the last 90 days to grow its SBA lending business Banc of California is focused on developing a nationwide platform for this program Often, SBA borrowers may start out with equipment financing or private financing, and graduate next to SBA loans (and finally move to conventional financing) SBA loans are an important part of the Banc of California small business lending strategy and provide longer terms and require less collateral than conventional loans Jaimie Haver Remarks (Highlights) Commercial equipment leasing offers an application only product for small to medium sized business from $10,000 to $150,000 (application only). The Commercial Equipment Finance Department has designed a product ideal for a small to medium sized company with a turnaround time that is typically about 4 hours. This product also features fixed affordable payments and provides 100% financing. All of these elements demonstrate Banc of California s commitment to ensuring that customers receive the equipment they need when they need it. Self-Introductions by Guests 30 minutes Remarks by Gary Dunn, Community Development Officer 15 minutes Mr. Dunn introduced himself and provided his background to those who did not know him. Mr. Dunn discussed his approach to CRA services, grants and donations. Mr. Dunn mentioned that the Bank is regulated and will have a stand-alone exam for CRA and will be graded by the regulator. The findings of the exam as well as the grade will be made public and published on the FFIEC website. He also pointed out to the entire group that this was a good opportunity for all the organizations in the room to cross collaborate and form new partnerships with others in the meeting and not just Banc of California. He also explained that banks cannot be all things to all nonprofits and vice versa and explained that partnerships should be formed based on the expertise and resources that a bank has and also that grants, donations and investments are tied to asset size and profitably. Mr. Sugarman then discussed the recent community development activities of the Bank. He mentioned the recent hiring of Gary Dunn and the large investment in Clearinghouse CDFI. He covered numerous volunteer activities that Bank employees and executives have recently - 3 -
participated in. Mr. Sugarman discussed finding the right people that understand the community needs and trying to meet those needs. He closed his opening remarks with the positive feedback that the Bank has received in past meetings and expressed his hope that this opportunity would produce similar results. Mr. Sugarman opened the meeting to all attending parties. Round Table Discussion 45 minutes An opportunity was provided to all attendees to introduce themselves, the groups that they represented and their mission. As introductions were made, certain topics were raised. There was a consensus within the group to continue the relationships that were fostered by Popular Community Bank and their staff. Round Table Discussion Themes 1. Affordable Housing 2. Financial Literacy 3. Small Business Lending Products Organizational Comments/Questions Mr. Geisel discussed his groups 20/20 Vision Program and inquired how the bank could assist. Ms. Martinez discussed a company that needs to move to a new location but is unable to obtain financing. She would like to focus on creating a structured program/service for medium and large business owners. She also wants to have a program created for businesses that are growing and expanding, mainly focusing on purchasing real estate. Ideally, she d like to see the creation of a family owned business workshop to help with the transition from one generation to the other of family owners. Ms. Riddle discussed the need and importance for literacy and that it is an underlying issue with all the groups and their causes. Another issue that was addressed was the need of succession planning in LMI communities. Ms. Endresen discussed the capabilities of the bank s SBA programs and how succession planning is implemented into those programs. She also discussed the lack of SBA financing and the huge opportunity the bank has to further penetrate this market The discussion then turned to community, namely Popular Community bank customers, and what their needs and wants are. Ms. Martinez discussed the opportunity to build relationships with the customer and to possibly recognize an opportunity to reach out to an individual in need of literacy training. Mr. Dunn explained the current financial literacy material that the bank uses and that it can be focused towards targeted age groups. Mr. Geisel discussed the distrust in banks that has been created in the past few years. Small community banks can build trust by investing in the community. The community feels that large banks only take and don t give back. Bridging the gap involves trust issues, fear, etc. but developing a long-term connection and specifically creating a stronger relationship with the religious community can help fix this. He stated, people like Steve Sugarman are what organizations like us need in order to move forward with our initiatives. Mr. Tamborello stated that he was aware of Banc of California s good efforts in the community thus far and looked forward to working with Gary Dunn and the bank in continuing the good legacy that Popular Community Bank. He brought up a Market match - 4 -
program that gives additional spending dollars to citizens shopping at LA County Farmer s markets as another possible way for Banc of California to be involved with the community. Ms. Riddle suggested the bank utilize the religious community in assisting in their outreach efforts. These efforts can help create trust between the community and the bank. She mentioned how Popular Community Bank staff volunteer and mentor students and that she wants that same spirit to follow with Banc of California s engagement. She also appreciated the fact that Banc of California has taken the initiative to reach out to the local community in an effort to maintain the relationships that Popular Community Bank held before the acquisition. She suggested Banc of California s involvement in adopting a literacy first partnership campaign. She mentioned that a bank could be very helpful in recognizing the need for financial literacy and offering these resources to its customers. The bank could create a program where bank tellers and associates are able to recognize when there is a lack of literacy among their clients and offer the resources that are available from Literacy First to combat these problems within the community. Banc of California staff members were willing to discuss this opportunity further with Ms. Riddle. The group discussed how the Popular Community Bank name brought a sense of trust and support to the community. There is a very loyal base to maintain and the bank should invest in maintaining and bridging the loyalty. Mrs. Sauceda discussed the need for LMI financing. Her husband, Mr. Sauceda, brought up the need of private financing as he has been self-funding people looking to get a start in business. Both also mentioned that they look forward to working with Banc of California and feel that accessibility is key. Mrs. Saucedo believes that Banc of California s team culture should extend to a friendship role and not just as the banker/client. Mr. Fraser discussed the rehab/remodel loan product that Banc of California has available and its potential reach in the market. He discussed how non-profit groups can get the loan and then have an LMI family assume the loan. Mr. Mills stated that these round table discussions are important to us at Clearing House because it gives us an opportunity to see the needs of other organizations that we can maybe partner with in the future. He feels that Banc of California is doing an excellent job by facilitating these discussions. Ms. Gutierrez wanted to know about the philanthropic efforts of the bank and what kind of programs and grants they provide. Mr. Dunn discussed how he envisions the bank s CRA program and getting the dollar as close to the street as possible. Ms. Gonzalez wanted to know if the bank was willing to commit to meet with her partners, create a CRA plan and meet later to view results. She wanted to know if the bank was committed to not closing any branches and if any decisions have been made to this effect. Mr. Sugarman responded that the bank makes strategic targets and treats all communities the same. Banc of California is a public company and will and must report their lending numbers. Mr. Sugarman feels that this will bring transparency and that meetings such as this promote and reinforce the bank s commitment to the community. Mr. Dunn reinforced to the group that the bank must answer to its regulator. The bank will have a stand-alone test of its CRA program and will be provided a rating that will be made public once completed. Ms. Davidds requested for Mr. Sugarman to visit the Hispanic Chamber of Commerce where the new CEO, Alice Perez, will be introduced. Ms. Oriel, representing the NAAC, wanted the bank to consider its use of ethnic media relationships. She also wanted to make sure the bank focuses on relationship building and - 5 -
roundtables with the Asian community. Mr. Sugarman stated that Banc of California has thought about this and is making considerations as to where to implement their marketing efforts. Ms. Oriel suggested looking at Wells Fargo and their use of ethnic media. Final Cross Organizational Networking 15 minutes Closing Remarks (Steven Sugarman) 5 minutes Meeting adjourned at 2:30 pm. - 6 -