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A Call for Responsible Banking

On Monday night I attended an action rally meeting in support of a proposed Responsible Banking Ordinance for the city of Los Angeles, organized by LA Voice PICO, a multidenominational, faith-based group advocating social justice issues. Over 800 people representing various churches, synagogues, temples and mosques from across Los Angeles gathered at Church of the Blessed Sacrament in Hollywood to listen to individuals recite their negative experiences with big banks, the need for banks to be more responsive and supporting of communities and local elected officials who are currently supporting such an ordinance in the City of Los Angeles.As if to emphasize the urgency of the cause and the solidarity of the ethnically- and religiously-  diverse crowd, the event kicked off with an invocation by Saadiq Saafir, an Islamic imam from Masjid Ibaadillah, a mosque in Jefferson Park and Lizzi Heydemann, a Jewish rabbi from Ikar, a synagogue in the Miracle Mile district. Only in L.A., huh!

With over $12.8 trillion in federal taxpayer dollars going to bail out the banks, which still reap billions in profits, “It’s time for the banks to bail us out,” said one of the organizers at the event. Basically the proposed Responsible Banking Ordinance would establish an A to F letter grade for banks (i.e. How the County Health Dept. rates restaurants) based on criteria consisting of increased loan modifications, small business loans, affordable housing loans, and access to banking in communities where payday lenders/check cashing centers outnumber bank branches. High-graded banks would gain millions in city deposits, while the lowest-graded banks would suffer divesture.

Bank of America was named as the principal Bad Guy, noted for being the largest forecloser in the region.

Jim Roman, owner of AJ’s BBQ Pit in East L.A. (the one located on 3rd St. next to the Gold Line tracks) talked about his difficulty in applying for small business loans from a large bank. “I was just a FICA score to them,” he said. Eventually he got the loans he wanted by going to Pan American Bank, a community bank also based in East L.A.

Representatives from Pan American Bank, billed as California’s oldest Latino-owned bank, as well as from Broadway Federal, an African American-owned bank with several branches in South L.A., were on hand to talk about their community-friendly practices. Both banks were lauded as examples of how banks should serve the community.
Seventh District L.A. City Councilman Richard Alarcon, who is apparently championing the Responsible Banking Ordinance cause in City Hall spoke on the importance of such an ordinance. He also mentioned that over 300,000 Angelenos do not have bank accounts. He was joined by Erik Sanjurjo from 14th District Councilman Jose Huizar’s office and Marta Segura from 13th District City Council President Eric Garcetti’s staff, who both relayed their bosses’ support for the Responsible Banking Ordinance. Other councilmembers reportedly supporting the ordinance include Herb Wesson (10th District) and Tom LaBonge (4th District).

Other cities have passed Responsible Banking Ordinances, such as Cleveland (1991) and Philadelphia (2002). But proponents hope that having the second-largest city in the US adopt such an ordinance, especially one that is home to large industries such as health care, manufacturing, entertainment, tourism and overseas trade, would send a powerful message to the banking industry.

With many different houses of worship, including my own, not just being represented, but united in the same issue, it was very inspiring to see the crowd focused on their commonalities — drawing strength in both their spiritual faith as well as their faith in changing the system. Granted, with smaller community banks and local politicos present who were already supportive of the ordinance, the event was largely preaching to the choir (pun intended). There was also some talk after the event about the bigger banks organizing their resistance to the ordinance, but the organizers took it as a positive sign that their voices were being taken seriously.

2 comments to A Call for Responsible Banking

  • Zach

    Nice write-up, Elson! Glad you were there.

  • Elson,

    Thanks for getting the word out. This whole economic mess has truly turned bank into a four-letter word. For the most part, true community banks such as Pan American Bank and Broadway Federal, have been thrown into the same bucket as those too-big-to-fail banks that took taxpayer funds and then used them to pay fat bonuses.

    I hope your message gets out. And I hope the community comes to appreciate the gems (community banks) they have in their back yard.

    All the best,

    Jesse Torres
    President and CEO
    Pan American Bank
    California’s Oldest Latino-Owned Bank

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