Bank of America softened the stance of some of its critics yesterday by pledging to a congressional banking committee that all layoffs related to the merger with Fleet are complete, and that it will invest millions more in local communities than Fleet was able to do.
Anne Finucane, Bank of America's northeast region president, told members of the House Financial Services Committee the bank already had returned 1,100 of the 2,900 jobs lost after the $48 billion merger, and would be back to premerger employment levels by mid-2006.
She also said the Charlotte, N.C., banking giant had pledged to put $100 billion in community reinvestment into the Northeast over the next decade. In the short term, that's $8.4 billion for Massachusetts in the next three years, a 24 percent jump over what Fleet distributed in its three years.
"At this point, I am confident that Bank of America means what it says," said Representative Barney Frank, Democrat of Newton, the ranking member of the committee who requested the field hearing, which drew bipartisan House representation from Alabama, California, New York, North Carolina, and Pennsylvania during a typically light working period for Congress.
Layoffs at some former Fleet branches after the merger prompted criticism and threats to withdraw state business from Bank of America.
Frank had been among the most vocal critics but tempered his comments considerably after three recent pronouncements of jobs coming to the region, including 300 jobs revealed last week as part of the relocation to Boston of the bank's wealth management division, one of four major divisions of the bank. He also lauded the bank yesterday for its commitment to affordable housing.
The four-hour hearing, held at the Federal Reserve Bank, lacked much of the passion and pointed criticism that had surrounded the merger.
However, community development leaders who testified said they were still skeptical of commitments made by Bank of America on issues such as small business loans and minority hiring and services, since the bank has refused to put such commitments in writing.
They also urged Congress to move to strengthen the federal Community Reinvestment Act with enforcement mechanisms to ensure banks live up to promises made during mergers.
Florence Hagins, assistant director of the Massachusetts Affordable Housing Alliance, said without being compelled to put specifics in writing, banks tend to "make public commitments which do not include much in the way of details."
When pressed by Representative John Tierney, Democrat of Salem, about why other banks, such as Sovereign and Citizens Bank, have spelled out more commitments in writing, Finucane denied it was a precaution against litigation. Instead, she said, it was a "new business model" and it allowed the bank more flexibility.
Representative Mike Capuano, Democrat of Somerville, seemed most wary of Bank of America's lack of written, specific commitments for communities, and questioned the timing of some of the bank's recent moves. For example, the bank revealed the addition of 300 jobs last week -- just days before the congressional panel was coming to town.