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Federal Reserve and OCC Should Reject TD Bank’s Proposed Merger with First Horizon Bank, Groups Write in Comment Letter

Tuesday, August 23, 2022
Nadine Chabrier

Proposed mega-bank would be the sixth largest in the U.S.
Federal bank regulators haven’t formally rejected a merger application in over 15 years, but Biden Administration has highlighted market concentration

WASHINGTON, D.C. – Amid growing concern about corporate consolidation, the Center for Responsible Lending (CRL) and Americans for Financial Reform Education Fund are leading a letter calling for the Federal Reserve and the Office of the Comptroller of the Currency (OCC) to reject a proposed merger between TD Bank and First Horizon Bank. Their comment letter points to several reasons why regulators should deny the application, including TD Bank’s exceptionally poor treatment of consumers and an exacerbation of the “too-big-to-fail” problem if the merger is approved. Co-signatories are Alaska PIRG, American Economic Liberties Project, California Reinvestment Coalition, Center for LGBTQ Economic Advancement and Research (CLEAR), Demos, People’s Action, The Revolving Door Project, Virginia Organizing, and the Woodstock Institute. A copy of the letter was shared with the Assistant Attorney General for the Antitrust Division at the U.S. Department of Justice (DOJ), Jonathan Kanter.

"The picture that emerges from TD Bank’s punitive overdraft policies and unfair and deceptive account practices is that TD is failing to meet the needs of communities it serves and lagging behind its industry peers. This proposed merger would harm consumers and small businesses, especially those in Black, Latino, and low-income communities," said Nadine Chabrier, senior policy counsel at the Center for Responsible Lending (CRL). "This proposed merger fails to meet requirements established by the law. It would defy logic for the government to give their blessing."

"The antitrust and bank regulators' hands-off approach to bank mergers has caused visible damage to communities by limiting access to credit for families and small businesses and raising the cost of simply having a bank account," said Renita Marcellin, senior policy analyst at Americans for Financial Reform. "The DOJ and bank regulators have an opportunity to stop this trend of excessive consolidation if they reform the bank merger guidelines, reject this merger, and prioritize the public's benefit."

The Bank Merger Act requires assessment of the merger on competition, safety and soundness, convenience and needs of the community to be served, and the financial stability of the banking system. The proposed merger would “result in a significant presence in the Southeast, in states like Tennessee, Texas, Arkansas, and Florida, among others, where there is a concentration of Black and Latino communities and poverty, often overlapping.” It would also become the sixth largest bank in the U.S. For these and other reasons outlined in the letter, the groups urge regulators to reject the proposal.

Download the full letter.

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