By Matthew Cabe
SAN BERNARDINO — The front lawn of LaTrae Lewis’ modest home on Sepulveda Avenue might seem an unlikely spot for a press conference involving a bank, especially one that recently increased its California footprint through a High Desert acquisition.
But for Flagstar Bank, as well as the advocacy and business groups in attendance Tuesday, the manicured grass and tree-shaded street outside Lewis’ $240,000 dream come true underscore the potential of a multi-million-dollar promise to the surrounding communities.
Amid its purchase of Desert Community Bank (DCB), Flagstar entered into agreements with the California Reinvestment Coalition (CRC) and Greenlining Institute (GRI) that include annual community-development investments over the next five years via approximately 20 percent of DCB’s total deposits, according to CRC Executive Director Paulina Gonzalez.
“This agreement illustrates what is possible when communities and financial institutions work together and when banks prioritize community needs,” Gonzalez said. “This agreement we are celebrating today includes home-ownership assistance programs especially targeted at low-income communities and communities of color.”
Small business loans, low-fee checking accounts and services for “immigrant customers” were also part of the agreements that Gonzalez said will “work to build a fair and inclusive economy” in San Bernardino and Riverside counties.
All eight DCB branches are located in the High Desert. Flagstar’s purchase includes $600 million in those aforementioned deposits, but how much of the bank’s reinvestment will funnel directly into the Victor Valley remains unknown.
Flagstar President and CEO Alessandro Di Nello told the Daily Press the company does not yet have “a basis from which to go from” insofar as concrete figures are concerned.
“In terms of dollars, that’s really hard to predict because you have to go where the opportunity is,” Di Nello said. “What I will tell you is there’s really no limit to how many loans we’ll make. We’ll make as many loans as we can possibly make. If we have willing buyers and willing borrowers we will have the creative programs that’ll be available for them.”
Also unclear is whether a plan exists to increase the number of DCB’s High Desert branches. Di Nello hoped “we can find the economics that make sense to expand geographically,” but he noted it’s too soon to be certain.
Which is fair considering Flagstar will remain in a transitional period until mid-March. What is certain, however, is DCB will retain the name that has become a local staple over the last 35 years.
“The people love the name. It’s well recognized,” Di Nello said. “It’s clear to me that there’s real goodwill in that name. So it would make no sense for us to change the name.”
While the DCB branches represent Flagstar’s first physical locations outside Michigan — the company is headquartered 11 miles southeast of Pontiac in Troy — the purchase expands the bank’s services here more than it introduces them.
Flagstar is the fifth largest mortgage lender in the country among banks, according to Di Nello, who said the company services more than 150,000 Californians and provided $10 billion in loans in the state last year alone.
That financial clout has allowed for community investment similar to what was championed Tuesday. In 2016, Flagstar announced a $10 million investment toward the regeneration of Pontiac, a city Di Nello called a “big GM town” before plants closed throughout Michigan.
The bank’s investment there has been slow to start, but “really active” over the last 12 months.
“We got a theatre we opened that was downtown that had been closed,” he said in reference to the Flagstar Strand Theatre for the Performing Arts. “We’ve been doing some small business lending to entrepreneurs that are opening businesses or that have been struggling, (and) we are in the midst of financial literacy programs with the local schools.”
A lending program for lower-income areas and “special treatment” for veterans through various programs were also introduced.
“If you were to talk to the mayor in Pontiac (Deirdre Waterman), she’s thrilled,” Di Nello said as he stood outside Lewis’ home, which reminds of the good that can come from a financial institution’s focus on community.
Lewis moved into the Sepulveda Avenue house with her husband and two children in March of last year with the help of Neighborhood Housing Services of the Inland Empire (NHSIE), a group whose president and CEO, Clemente Mojica, was also on hand Tuesday.
Lewis told the Daily Press she went through NHSIE’s homebuyer education program, finding an affordable home situated away from San Bernardino’s “rough patches.”
″(They) found the perfect home — except for this garbage truck,” Lewis said with a laugh as a trash truck worked the street. “Otherwise it’s quiet. My neighbors are really friendly.”
Through NHSIE, Lewis said she secured about $30,000 for her family’s first home, which came with a surprise: “My husband lifted up the carpet and there was hardwood underneath. He was able to sand it down and stain it, and it’s beautiful throughout the whole house.”