Mortgage discrimination leads to bank investment

DETROIT (AP) -- Two banks have agreed to invest in a Detroit neighborhood as part of a mortgage discrimination settlement with the federal government.

The Justice Department said last Thursday that the deal with Citizens Republic Bancorp Inc. and Citizens Bank of Flint resolves allegations that their service for the credit needs of residents in white Detroit-area neighborhoods was "significantly greater" than for those in black neighborhoods.

Citizens Republic Bancorp Inc. is identified as the successor to Republic Bank.

The settlement calls for a $1.6 million in matching grants for improvements on homes in Detroit; $1.5 million for a special financing program for blacks in Wayne County; and $500,000 for potential customer outreach.

Citizens Bank also will open a loan production office in a majority black area in Detroit.

Published: Mon, May 9, 2011