SEATTLE--(BUSINESS WIRE)--Sept. 5, 2001--Washington Mutual
(NYSE:WM) today announced the largest-ever community lending
commitment of $375 billion over the next 10 years, more than tripling
its 1998 commitment to the low- to moderate-income communities it
The new commitment is earmarked to begin in 2002 for communities
throughout the United States.
In 1998, the company committed a record $120 billion for CRA
goals, and with the help of its many community partners, the company
reached almost 30 percent of the ten-year goal in just two years.
"Our continued success as one of America's leading financial
services companies provides us with the opportunity to set even higher
community service standards for the future. Today, we continue our
more than 100-year legacy of making the communities we serve better
places to live, work and do business," said Kerry Killinger,
Washington Mutual's President, Chairman and CEO. "After carefully
assessing the continued growth of our company and the anticipated
level of lending resulting from a successful merger with Dime Bancorp,
we're confident that we can raise the bar in support of our
Under the CRA commitment Washington Mutual will provide loans and
other financial support to communities consisting predominantly of
people of color, to residents of low- to moderate-income (LMI) census
tracts, and to people whose income is below 80 percent of median
The $375 billion commitment targets single-family lending,
consumer and small business lending, multi-family lending and
community investment and development:
-- Single-Family Lending -- $300 billion in housing loans will be
provided to minority borrowers, borrowers in LMI census
tracts, and borrowers earning less than 80 percent of median
income. Of this amount, $100 billion is specifically targeted
for low- to moderate-income borrowers.
-- Consumer and Small Business Lending -- $48 billion is targeted
for consumers and small business owners, including businesses
owned by people of color, women or disabled persons.
-- Multi-Family Lending -- $25 billion is earmarked for
apartments and manufactured home park developments in LMI
census tracts or for families earning less than 80 percent of
median income. There is no minimum loan size for multi-family
-- Community Investment and Development -- Washington Mutual is
committing $2 billion in investments and loans to community
development and low-income housing initiatives, tax-exempt
housing revenue bonds, and community banks and financial
institutions targeting multi-cultural communities or other
community needs. This commitment includes support for
pre-development work, which it funds through nonprofit
organizations and investments in community development
"As a leading national lender, we firmly believe in providing
greater access to credit and financial products to the communities
where it is most needed," Killinger said. "We look forward to working
with our community partners to further our legacy of service well into
our second century of doing business."
The company said that the continued support of the Federal Home
Loan Bank System and access to its programs in the multiple regions it
serves are additional factors that will be pivotal in the company's
ability to meet its commitment.
To help achieve its ambitious goal of serving the needs of its
communities in the years to come, the company has laid out a detailed
set of plans, which include:
-- Innovative Solutions for Under-served Communities --
Washington Mutual has developed a wide range of collaborative
programs to support the special needs of the under-served
communities it serves. These programs include a focus on
non-profit housing providers, Native American tribes,
self-help housing, Community Land Trusts and participation in
the Federal Home Loan Bank's affordable housing programs.
-- Providing Free and Low Cost Financial Services -- Washington
Mutual offers a variety of free and low-cost services,
including Free Checking(TM) which features unlimited check
writing, no monthly service fee, no minimum balance obligation
and no direct deposit requirement. Nearly all of Washington
Mutual's ATM machines are surcharge-free, meaning anyone --
including low- to moderate-income non-customers -- can use
them without paying a fee to the bank.
-- Corporate Giving -- Washington Mutual returns 2 percent of
pre-tax earnings to the communities it serves through grants,
sponsorships, loans at below market rates, in-kind donations,
paid employee volunteer time, and other financial support.
Contributions are proportional to the size of operations in a
particular market and take into account special needs of
communities. Washington Mutual also encourages volunteerism
among its employees by providing four hours of paid time off
each month for service to nonprofit groups and causes.
Washington Mutual also is committed to adhering to a set of
formally adopted responsible mortgage lending principles to ensure
that underserved communities and borrowers have credit available on
fair and appropriate terms. Under the principles, Washington Mutual:
Will not sell single premium credit insurance on mortgages.
The company will provide an option for credit insurance billed
on a monthly basis with clear disclosures that the product is
Will not impose more than 5% in points and non-pass-through
fees on any loan, unless the borrower receives a direct
reduction in the loan's interest rate.
Will provide customers with an option between loans with
pre-payment fees and lower interest rates and loans with
higher interest rates, but without pre-payment fees.
Will only make mortgage loans where the borrower has a
demonstrated ability to repay and will not refinance any loan
unless there is a net tangible benefit to the borrower.
Will not offer subprime loans with compulsory negative
amortization, balloon payments, or non-default call
Will not originate high-cost mortgages (based on current HOEPA
standards) in excess of $20,000.
The full text of Washington Mutual's Community Lending Commitment
and Responsible Lending Principles can be found on the company's web
site at www.wamu.com.
With a history dating back to 1889, Washington Mutual is a
national financial services company that provides a diversified line
of products and services to consumers and small- to mid-sized
businesses. At June 30, 2001, Washington Mutual and its subsidiaries
had consolidated assets of $229.30 billion. Washington Mutual
currently operates more than 2,300 consumer banking, mortgage lending,
commercial banking, consumer finance and financial services offices
throughout the nation.
||Alan Gulick, 206/377-3637 (Media)