BANKING & FINANCE - Feb. 10, 1993

Fed Cites Bias in Denying Branch Application: The Federal Reserve Board denied the application by Farmers & Merchants Bank of Long Beach to open a branch in Costa Mesa because of the bank’s “repeated violations of consumer lending laws” and poor performance under the Community Reinvestment Act. The bank suffers “chronic deficiencies” in its compliance with the CRA, which requires lenders to meet the credit needs of their local communities, according to the Fed statement. The agency said that the bank has “undertaken efforts” to improve its performance, but the application was denied because of the “prolonged compliance problems” and the short time since corrective measures began.