FOR IMMEDIATE RELEASE: March 4, 2025
Contact: Andy Morrison, andy@neweconomynyc.org
ELECTED OFFICIALS, COMMUNITY GROUPS RALLY FOR PUBLIC BANKS, SLAM COMMERCIAL BANKS FOR FUELING RACIAL WEALTH GAP
GROUPS TESTIFY AT SENATE HEARING ABOUT EFFECTS OF PERSISTENT REDLINING ON BLACK AND BROWN COMMUNITIES
NEW SURVEY DATA: NEW YORKERS SUPPORT PUBLIC BANKING BY MORE THAN A 4:1 MARGIN, WITH STRONGEST BACKING IN BUFFALO, ROCHESTER, AND NEW YORK CITY
Albany, NY – On Tuesday, a statewide coalition of community and labor groups and community credit unions rallied with elected officials at the Legislative Office Building in Albany, calling on New York State to take urgently needed action on lending discrimination and create public banks to ensure fair lending and economic justice for all New Yorkers. The coalition unveiled a new survey by Community Service Society (CSS) finding strong majority support for public banking across New York State.
The rally preceded a New York State Senate hearing titled “Is There Discrimination in the New York Home Mortgage Banking Industry?,” which was convened in response to a 2024 report by New Economy Project exposing stark racial disparities in mortgage lending by major commercial banks in NYC.
Wearing signs with red “DENIED” stamps to illustrate persistent racial disparities in mortgage lending, New Yorkers at the rally shared the impact of redlining and exploitative practices in their own communities—blocking Black and brown families from homeownership, fueling foreclosures, and more. They called on the legislature to crack down on banks’ unfair lending, and to advance public banks as a matter of racial justice.
At the hearing, coalition members including New Economy Project, East New York Community Land Trust, New York Communities for Change, Center for NYC Neighborhoods, and CSS testified at length about the impact of persistent redlining on Black and Brown communities in New York. The groups called for bold solutions to transform our financial system—starting with enactment of public banking legislation.
Public banks are financial institutions created by local governments and chartered to serve the public interest. With a public bank, a local government could divest city funds from megabanks that fuel racial wealth inequities, and instead make equitable investments in the public good, including by partnering with responsible Community Development Financial Institutions to generate new loans in historically redlined communities.
In his testimony before the Banks Committee, New Economy Project’s Andy Morrison underscored the urgent need for New York to swiftly and forcefully act, given the Trump administration’s rollback of regulations and efforts to dismantle the Consumer Financial Protection Bureau. In the context of escalating federal threats, he called on the state not only to protect New Yorkers from immediate financial exploitation, but also to advance solutions that address root causes of banking inequality.
New Economy Project’s mortgage analysis looked at home mortgage lending by Bank of America, Citibank, and JPMorgan Chase—the three banks that hold the vast majority of New York City’s municipal deposits. The report found that from 2018 to 2023, these three banks charged Black homebuyers interest rates that were 31 basis points higher, on average, than rates charged to all other homebuyers, even when controlling for income and debt levels. This interest rate disparity will cost a Black homeowner an estimated $30,212 more in interest payments over the course of a 30-year mortgage. The banks also denied Black homeowners refinancing loans at nearly twice the rate of White borrowers, blocking them from opportunities to secure lower interest rates and monthly payments.
The analysis echoed the NYS Attorney General’s statewide 2023 report, which identified persistent racial disparities by mortgage lenders statewide, controlling for credit score and a host of other factors.
Morrison and other advocates urged the legislature to advance the Bank of Rochester Act, a bill that would authorize the establishment of a public bank in Rochester, and which could serve as a launching pad for broader public banking initiatives across the state. They also called on the state to pass the New York Public Banking Act, which would create a safe and appropriate regulatory framework for local governments to establish public banks.
The CSS survey found that a majority of New Yorkers support public banking legislation, with support highest in New York City and Western New York, where there are already strong public campaigns for public banking. Support was highest in communities disproportionately harmed by large Wall Street banks, with 69 percent of Black New Yorkers and 64 percent of Latino New Yorkers supporting public banking.
In a recent Amsterdam News column, CSS CEO David Jones wrote that public banks can “boost access for those left behind by Wall Street” and through partnerships with CDFIs, “offer lines of credit at the scale needed to finally close the racial wealth gap in New York.”
QUOTES:
“Currently, New York State’s taxpayer dollars sit in private banks on Wall Street that actively perpetuate racial wealth inequality through discriminatory mortgage lending practices,” said Assemblymember Harvey Epstein. “A public bank gives New Yorkers the voice they deserve, placing the money where it is publicly accountable and utilized for investment in New York priorities like affordable housing, clean energy initiatives, fair banking services and eliminating the racial wealth gap. This has the potential to transform our banking system by making it more equitable, accountable and profitable for New York. We don’t have time to waste in protecting New Yorkers.”
“This devastating report exposes the racial disparities and structural inequalities that still persist in our financial system. We need to ensure accountability and real consequences for anyone committing discriminatory lending practices, and finally establish a public bank in New York. My colleagues and I will do all that we can to fight for these measures in this year’s legislative session,” said Assemblymember Ron Kim.
“These findings once again make clear that local governments must divest from the big banks as a matter of racial justice,” said Tousif Ahsan of New Economy Project, which coordinates the Public Bank NYC and New York State Community Equity Agenda coalitions. “A public bank would allow us to do just that, and that’s why New York State must pass the New York Public Banking Act. Through public banking, our cities can responsibly steward our public dollars while investing in permanently affordable housing and community wealth-building initiatives in historically redlined Black and brown neighborhoods.”
“We polled New Yorkers about their support for public banking and the results are clear,” said David R. Jones, President and CEO of the Community Service Society of New York. “A majority of New Yorkers support public banking legislation and support is highest among those disproportionately harmed by large Wall Street banks. The New York Public Banking Act would finally give local governments the tools they need to divest from these institutions and expand banking access to those who’ve been excluded for far too long.”
“Our credit union has a strong track record of serving communities of color,” said Linda Levy of the Lower East Side People’s Federal Credit Union. “By partnering with – and investing in – CDFIs, a public bank would increase our capacity to serve even more New Yorkers and to provide affordable and equitable financial services to communities that have long been exploited by big banks.”
“New York communities need public banking legislation. Municipally chartered public banks can fill the void created by private banking institutions in underbanked and historically redlined communities of color, which have left people and whole neighborhoods vulnerable to predatory lending,” said Christie Peale, Executive Director of the Center for NYC Neighborhoods. “Public banking can also provide critical capital to fuel a range of affordable solutions for working and middle-class homeowners, including home upgrades to future-proof homes through decarbonization and towards climate resilience.”
“It’s becoming abundantly clear that public banking is a solution to the persistent redlining and discrimination that has plagued New York City for years,” said Jodie Leidecker, an Organizer at Cooper Square Committee. “These feckless megabanks are not only discriminating against Black homeowners; they are turning a blind eye to egregious actions by landlords and funding harassment and tenant displacement. A public bank is the solution we need to end the drainage of wealth from working people – tenants and homeowners alike – all to enrich the affluent.”
“For far too long, predatory lenders have preyed on East New York homeowners and tenants. Meanwhile, the big banks are more interested in turning a profit than in ensuring Black and brown young people have access to truly affordable housing and community wealth building opportunities,” said Albert Scott, a member of East New York Community Land Trust. “We need a public bank chartered to serve the public interest that will invest in real affordable housing in our communities of color.”
“This latest research on the discriminatory and exploitative practices of big commercial banks is yet another reason why we need public banking in New York,” said Kyle Giller, staff attorney at the New York Public Interest Research Group (NYPIRG). “Enacting public banking legislation will enable our cities and counties to divest our tax dollars from Wall Street banks and create a publicly accountable financial institution that can invest in community needs and public goods. A public bank will allow our communities to finally make the bold investments we need to address racial inequities, expand affordable financial services like credit unions, and build permanently affordable housing.”
“We need a public bank to address the housing crisis in New York City. As a community organization mobilizing low-income people of color in the boroughs, we continuously see people being priced out of their communities. A public bank will fund much needed affordable housing for those who need it the most and who keep the city running – the working class,” said Carlos Encarnacion, a Community Organizer with New York Communities for Change. “The legislature must pass the New York Public Banking Act now.”