Mercantile and Firstbank merger will likely be delayed
Consumer protection group alleges Mercantile Bank loaned no money to minorities in 2012
GRAND RAPIDS — A merger between Mercantile Bank Corp. of Grand Rapids and Firstbank Corp. of Alma will likely not be completed by the end of the year as originally expected after being challenged by the consumer protection group Inner City Press/Fair Finance Watch, which claims that Mercantile Bank had not lent any money to minorities.
“In 2012 in the Grand Rapids MSA for conventional home purchase loans, Mercantile Bank lent only to whites,” Matthew Lee, executive director of Inner City Press/Fair Finance Watch said in an email to the Herald Nov. 24. “Its mortgage company made 42 such loans to whites, none to African Americans or Latinos.”
“In 2012 in the Grand Rapids MSA for refinance loans, Mercantile Bank lent only to whites,” Lee said. “Its mortgage company made 159 such loans to whites. It had a 100 percent denial rate for African American applicants.”
The Herald contacted representatives from Firstbank and Mercantile Bank and received an email response from Mercantile Bank Chairman CEO Michael Price, who said he could not comment on the issue.
“We believe it would not be appropriate to comment on a pending regulatory application,” Price said in the statement.
He continues with some information about Mercantile Bank’s contributions to the community.
“Since its founding, Mercantile Bank has maintained a solid record of compliance with the Community Reinvestment Act,” Price said. “In its last two Community Reinvestment Act examinations, the bank received an ‘outstanding’ rating by the FDIC examiners, the highest rating possible.”
Price said the FDIC concluded in its most recent CRA performance evaluation that Mercantile Bank had “an outstanding record of helping to meet the credit needs of its assessment area, particularly low- and moderate-income individuals and small businesses in a manner consistent with its resources and capabilities.”
Price said Mercantile Bank’s primary focus is on commercial lending, rather than consumer lending, and that 93 percent of its lending was to commercial customers in 2012.
“As a commercial bank, Mercantile Bank is a leader in the Grand Rapids/Wyoming MSA in small business lending,” Price said. “Despite the fact that it holds only a 5.52 percent market share of deposits in the MSA, the bank accounts for a much larger share of small business lending.”
According to a statement filed with the Securities and Exchange Commission Nov. 26, Mercantile Bank expects the merger to be delayed.
“Due to the timing of recent regulatory processes and approvals, Mercantile Bank Corporation expects that its previously announced merger with Firstbank Corporation will not be completed on Jan. 1, 2014, as previously disclosed,” the statement reads. “The company currently expects that the merger will close later in the first quarter of 2014.”