FED/OCC Public Hearing
Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency
Written Statement of
CEO for the Americas, MUFG and President & CEO, MUFG Americas Holdings Corporation and MUFG Union Bank, N.A.
Head of Corporate Social Responsibility for the Americas
MUFG Union Bank, NA
March 8, 2022
Thank you to the Federal Reserve and the Office of the Comptroller of the Currency for convening this meeting. I’m Kevin Cronin, CEO for MUFG in the Americas. Thank you for providing this opportunity to talk about the proposed sale of MUFG Union Bank to U.S. Bank.
As you heard from Mr. Cecere, the proposed transaction will bring together two banks with client-centric cultures and shared values around good stewardship. After careful and thoughtful analysis, we determined U.S. Bank was the most compelling acquirer for important reasons. First, we are very confident this combination will deliver a better client experience through strong technology and digital capabilities, as well as an expanded physical branch network which is so important to our consumer and small business clients. Second, the combined business will create broader growth opportunities for our talented colleagues. Additionally, the combined company will maintain a culture of delivering outstanding customer service, while preserving the Main Street banking model and maintaining close ties to the communities in our legacy footprint of California, Washington, and Oregon. We are confident that we selected the right partner for this next chapter for Union Bank. U.S. Bank will carry forward our long legacy of community engagement, commitment, and investment, a reflection of our core values. In short, U.S. Bank and MUFG Union Bank are both strong institutions today, and together can create enhanced value for our clients, colleagues, and the communities we serve.
In terms of the transaction, the sale includes the consumer, wealth management, and commercial banking businesses, including our small business banking client franchise. Additionally, the 8,000 colleagues that support these businesses will transition to U.S Bank. Of course, the sale is contingent upon regulatory approval in both the U.S. and in Japan.
The Future of MUFG in the Americas
After the sale, MUFG’s combined U.S. operations will continue to be one of the largest foreign bank organizations in the U.S., albeit with a sharper focus on wholesale banking. MUFG remains committed to maintaining a robust presence in the United States. We look forward to continuing our long history of serving clients and playing a key role in supporting job creation and overall growth of the U.S. economy. One example is our market-leading project finance team’s support of growth and investment in critical infrastructure and our leadership in supporting our clients’ transition to carbon neutrality with the financing of renewable energy projects tied to our ESG commitment.
As part of this transaction, we will also continue to be a stakeholder and a substantial shareholder in U.S. Bank with a 2.9% ownership stake.
MUFG Bank will remain steadfast in engaging and partnering with our communities, and maintaining best-in-class talent, standards, and programs in support of corporate and social responsibility. Our laser focus on gender and racial equity and inclusion, sustainability initiatives, like our participation in the Net-Zero Banking Alliance, and our philanthropic and civic engagement will continue under the MUFG Bank banner.
Thank you for the opportunity to speak with all of you today. I will now turn it over to Julius Robinson, Head of Corporate Social Responsibility in the Americas. Julius leads our community reinvestment efforts and chairs the MUFG Union Bank Foundation. Julius has been a strong and visible leader in the communities in which we do business for over twenty years.
What this means for our communities
Thank you, Kevin.
Thank you distinguished members of the Board and the OCC, it’s an honor to speak with you today. I’m Julius Robinson, Head of Corporate Social Responsibility for the Americas for MUFG Union Bank.
You know, we are confident that U.S. Bank and Union Bank together will continue their enduring commitment to our communities. We expect to find a highly complementary cultural fit across the teams, providing for a continued high level of engagement with our communities, including building on our legacies of exemplary Community Reinvestment Act (CRA) performance with both companies currently rated as Outstanding. Through efforts spanning nearly 20 years, MUFG Union Bank has maintained an “Outstanding” rating from the OCC for the last five assessments. And I believe the combined company will strive to maintain that rating.
MUFG Union Bank has long been, and will continue to be, unwavering in its commitment of supporting low- and moderate-income and diverse communities across our footprint. In combination with U.S. Bank going forward, we will continue the considerable work necessary to preserve jobs, grow small businesses, and build thriving communities. This work is continuing through the MUFG Union Bank Foundation, the Community Recovery Program, Gives Back employee volunteering, student-run branches, and special initiatives supported through our business line partnerships. In reviewing U.S. Bank’s Community Benefits Plan, we believe the tenets outlined in the document mirror the spirit of, and will continue to build on, the legacy of MUFG Union Bank’s community support in California.
In the 24 years I have been with MUFG Union Bank, I am proud of the social investments we’ve made and our active demonstration of our values. Strengthening community ties—backed by a commitment to engaging community partners, clients, and colleagues—is at the core of what we do, and this social commitment will be strengthened through the proposed combination.
As we move forward with integration activities, we are clear-eyed that our companies share a belief that our economic success is inextricably linked to the success of the communities in which we operate. In 2021 alone, the MUFG Union Bank charitable contributions program totaled over $17 million. Our strategic investments are focused on affordable housing and economic development, social services, and stewardship and environmental sustainability.
Every day we are driven to find ways to support our clients that will best serve their lives, families, financial well-being, and businesses. For example, in response to the impact of Covid-19, the bank implemented the MUFG Union Bank Community Recovery Program, a $10 million initiative to support non-profit organizations that are dedicated to social and racial justice. Both MUFG Union Bank and U.S. Bank have a long history of supporting community groups and non-profit organizations by deeply investing time, expertise, and capital. All of that will continue.
We’re especially delighted about our recent groundbreaking and one-of-a-kind Union Bank Student-Run Branch on the campus of Laney Community College, in Oakland California. We’ve operated five other student-run branches in high schools since 2008, our first in Fresno, then Los Angeles, El Monte, and Anaheim. We are pleased that U.S. Bank has committed to adopting this program as part of their forthcoming Community Benefits Plan.
Union Bank and U.S. Bank share a commitment to support colleagues and further invest in communities through employee volunteerism. The MUFG Union Bank volunteer program, MUFG Gives Back, delivered almost 51 thousand volunteer hours in 2021, up 53% compared to the previous year, which is emblematic of our company and colleagues’ commitment to the community, and the very heart of our culture and values, especially when you consider the challenges the pandemic presented to us all.
We believe in the opportunity to scale many of these groundbreaking and innovative initiatives I’ve mentioned created by bringing together our two companies. Thus, I’m asking for your thoughtful consideration as we move forward from these proceedings.
I am pleased to have the opportunity to speak with all of you today. Kevin and I look forward to hearing the views of everyone participating in this public meeting.
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