PA Treasurer Opens Inquiry into Lending Disparities at Financial Institutions

Pennsylvania Treasurer, Joe Torsella, recently announced that his office has opened an official inquiry into three financial institutions regarding alleged racial and ethnic disparities in home mortgage approval rates and lending practices, as reported in a recent study from the Center for Investigative Reporting.  The study analyzed federal mortgage data released through the Home Mortgage Disclosure Act to conclude that lending disparities caused people of color to be denied a conventional mortgage more often than Caucasian applicants.

In response, the PA Treasury sent a letter to three identified financial institutions, all of which the Treasury currently has a contractual relationship, requesting information and a determination whether the data in the report was accurate.  In addition, the Treasury requested information relating to potential discrepancies and differences in connection with racial or ethnic groups, and any relevant policies associated with the underwriting criteria within the financial institutions’ services.