Mayor Marion Barry yesterday asked the comptroller of the currency to delay action on requests by 11 companies seeking District-chartered banks until the applicants agree to submit community investment plans that comply with a newly enacted D.C. banking law.
The mayor's request comes as D.C. City Council member Charlene Drew Jarvis (D-Ward 4), chairman of the committee that oversees bank licensing in the District, is preparing her own recommendation on the requests. The requests were submitted to the comptroller days before a local law took effect requiring substantial community investment from bank applicants.
Neither Jarvis nor lawyers for the 11 applicants could be reached late yesterday.
In a letter yesterday to Comptroller Robert L. Clarke, Barry said that unless the applicants are forced to comply with the investment requirements, "banks that your office may charter will have an unjustified advantage over banks that the District of Columbia may charter later."
Barry, who backed the banking bill, which took effect April 11, said, "This inequality would clearly undermine the intent . . . of locally elected officials."
Four major bank holding companies and seven other companies have applied to the comptroller for charters in the District. The companies filed their applications before April 11, when the newly enacted law transferred to the D.C. City Council the right to issue such charters.
In addition to shifting chartering power from the U.S. government to the District, the law also requires that any company setting up or acquiring a bank in the District invest between $50 million and $100 million, open two branches in economically depressed areas and create 200 jobs.
The applications were filed while the comptroller still had authority over charters, under an obscure, 85-year-old federal law pertaining to banks in the District.
The 11 applicants have told the council they intend to invest in the community, but that the banks they propose will not be large enough to justify an investment of the magnitude prescribed by the new law.