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Public Meeting Transcripts

Public Meeting Regarding Citicorp and Travelers Group

Friday, June 26, 1998

Transcript of Panel Twenty

                                                                491

  20               MR. LONEY:  Are there any other

  21     questions?  If not, I will thank the panel for

  22     coming.

  23               Let me just ask the audience, Lloyd

  24     Williams, Cary Sanchez, or John Defano?  Are

  25     any of them in the audience?  If not, we're



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   2     scheduled for a break, and we're early for that

   3     break, but since the folks who were scheduled

   4     to testify aren't here, I think we have no real

   5     choice but to take the break.  We'll come back

   6     at the next panel scheduled for 9:40.

   7               (Recess) up low piece?

   8               My name is Lillian Rodriguez Lopez

   9     and I serve as the acting president of the

  10     Hispanic Federation, a membership organization

  11     representing the Latino human services sector

  12     in New York, and New Jersey.

  13               I am pleased to have been given this

  14     opportunity to address you about the proposed

  15     merger.  I can speak with authority about the

  16     philanthropic activities of Citibank, and its

  17     impact in the Hispanic community as well as

  18     Citibank's commitment to economic development

  19     in New York City neighborhoods.

  20               Citibank was one of our first

  21     supporters and has remained a supporter since

  22     our inception in 1990.  Our partnership has

  23     resolved around the collection and analysis of

  24     data on Latinos that serves to promote a

  25     greater understanding of our social, economic,



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   1

   2     and political roles in the city.  They have

   3     helped us to share with the larger community,

   4     our dreams, our aspirations, and our reality.

   5     Citibank has supported the publication of

   6     Hispano-Stats, one of our yearly publications

   7     for the past three years.

   8               With Citibank assistance, we

   9     distributed over ten thousand copies of our

  10     first Hispano-Stats, which presented a

  11     demographic and economic profile of Latino New

  12     Yorkers.  We still receive requests for the

  13     inaugural Hispano-Stats from elected officials,

  14     funders, students and many of our member

  15     agencies.

  16               Our second edition of Hispano-Stats

  17     helped interpret the political strength and

  18     potential of the Hispanic community in 29 New

  19     York City neighborhoods, and the third one

  20     which we'll be issuing shortly will profile

  21     Hispanic institutions providing services to

  22     communities throughout the State of New York.

  23               This I say just to illustrate

  24     Citibank's commitment to a better understanding

  25     of the Hispanic community in New York.



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   2     Citibank has also been committed to

   3     strengthening the economic fiber of the Latino

   4     community.  Three years ago, Hispanics in

   5     northern Manhattan joined together to create an

   6     economic development institution dedicated to

   7     growing neighborhoods and assisting Hispanic

   8     and Dominican with small business.

   9               Citibank has been a partner in this

  10     enterprise and today, the Audubon Partnership

  11     for Economic Development grows stronger.  Just

  12     one month ago the empowerment zone awarded to

  13     the Audubon Partnership, a three quarter

  14     million dollar grant to help Dominican

  15     merchants in this area.

  16               This is a fine accomplishment for

  17     such a young nonprofit organization.  I could

  18     share much more with you about Citibank, but my

  19     time is limited.  I just want to say that they

  20     have been a very strong supporter of the

  21     Hispanic community.

  22               MR. LONEY:  Thank you.

  23               (Continued on next page)

  24

  25



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   2               MR. LONEY:  Thank you.  I would just

   3     say to the panel, if you have written testimony

   4     and you want to make sure it all gets in, leave

   5     a copy with the registration desk in the front;

   6     the entire statement will be put in the record.

   7               Ms. Middleton.

   8               MS. MIDDLETON:  Good morning and

   9     thank you for affording me this opportunity to

  10     speak before this panel.  My name is Shirley

  11     Middleton, and I am the founder of WLM Bridge

  12     the Gap Family Day Care, which was established

  13     to provide professional, educational, and

  14     affordable childcare services in a safe and

  15     motivating environment.

  16               As for our children and their

  17     families, our broad range and comprehensive

  18     program addresses these changing needs that

  19     help our clients to maintain human dignity to

  20     be functional and productive members of

  21     society.  We provide job training development

  22     and offer entrepreneurial training to the

  23     family day care providers and new small

  24     business operators and home businesses.

  25               Bridge the Gap Family Day Care



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   2     network has established a relationship and a

   3     commitment with Citibank to support our

   4     community entrepreneurial and economic training

   5     program.  They have supported these programs

   6     and others through grants, and they have been

   7     mainstays of our board of directors.

   8               Citibank has been servicing our

   9     community through a joint effort for the past

  10     two years, for the past two-and-a-half years.

  11     We have trained approximately 60 family day

  12     care providers in developing their business as

  13     a professional business, who now have had

  14     access to opening up a business account with

  15     the proper credentials.

  16               The staff of Citibank assists with

  17     the training of the providers, helping the

  18     providers to develop business plans; also, in

  19     terms of how to report their quarterly taxes;

  20     setting up payrolls; and, also, assisting them

  21     in opening up the business account that will

  22     suit their business; also, they have training

  23     in PC Banking; and, also, they have helped with

  24     the credit plans of these providers; and they

  25     have had seminars on mortgages and commercial



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   2     buying.

   3               Bridge the Gap supports the merger of

   4     Citicorp and Travelers Insurance to become one.

   5               We, the members of the Bridge the

   6     Gap, hope for the merger because change must

   7     come within all our lives.  We do not agree

   8     with their past servicing, servicing of the

   9     minority communities across this land.  We will

  10     not quote statistics because it is all in the

  11     record.

  12               To go forward, we believe history is

  13     a lesson we all must learn from.  History keep

  14     us from making the same errors over and over.

  15     History has posed to us many opportunities;

  16     some have been partially implemented and some

  17     have not been acknowledged.  We all have a

  18     history, but we were not a part -- it was not a

  19     part of our lives.  Many changes came about by

  20     war, enslavement and cheating.  No matter what

  21     the methods used, history remains on the

  22     record.

  23               Today and the future is what we are

  24     addressing going into the new millennium.

  25     Although we support the merger of these two



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   2     financial institutions, we put before you this

   3     day the following proposal:

   4               Let us begin by developing a

   5     community business consultant group that will

   6     be directly involved with the local community

   7     small businesses and home businesses; also, to

   8     have staff or members from this financial group

   9     to be able to be a part of the small business

  10     not-for-profit board, in terms of helping them

  11     in managing their business for the first five

  12     years of operation, because doing business in

  13     the first five years, for one who does

  14     not-for-profit business development -- to have

  15     the team review with the businesses, and

  16     seminars, how to maintain good records, tax

  17     reporting, business accounts, reviewing their

  18     books every three months -- this will provide

  19     the kind of support for the business to go on

  20     and not become a failing business and here we

  21     are again in trouble.

  22               Instead of always giving us loans to

  23     start up a business, provide many startup

  24     business grants instead of loans, as I said

  25     before.  Because this creates problems; we



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   2     start out with a loan and we end up in a hole.

   3               We also would like partnerships to be

   4     developed with the various programs of our

   5     community, educational programs, between

   6     Citibank, also, economic development programs

   7     within our community.

   8               The other thing, instead of giving

   9     students loans all the time, let us develop

  10     some kind of grant or scholarship for students,

  11     at least for the first two years, so when they

  12     graduate from college they will owe 25,000 and

  13     30,000 before they get a job.

  14               As we outlined in this partial

  15     proposal, we challenge you to be committed to

  16     all of the minority communities across the

  17     land.  Once again we get into classifying

  18     minorities, Afro-American women, and who knows

  19     better but myself and as a single parent.

  20               Thank you for allowing me this

  21     opportunity.

  22               MR. LONEY:  Thank you, Ms. Middleton.

  23               Ms. Johnson-Claxton.

  24               MS. JOHNSON-CLAXTON:  Good morning.

  25     My name is Grace Johnson-Claxton.  I am the



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   2     president of Johnson Home Care Services.  We

   3     are a nursing agency that places nurses in the

   4     home.

   5               Citibank has been very instrumental

   6     in assisting us in our payroll and also in

   7     helping us to acquire larger headquarters.

   8     They also have assisted us in making available

   9     different opportunities for our employees, like

  10     direct deposit, and give an offering to our

  11     employees, mortgages at a lower rate, and car

  12     loans.

  13               I enjoy a very positive relationship

  14     with my bank, bank manager -- her name is Kathy

  15     Wheeler -- and also with my personal banker

  16     whom made the request for me to be here today,

  17     Gus Patraco.  I am very grateful to the support

  18     and help that the bank had given to me.

  19               My credit line they have increased,

  20     and, as I said, that assisted me very much with

  21     my payroll because many a nights before the

  22     credit line -- and the business keep, you know,

  23     burning up on the cash flow -- we had to divest

  24     to meet our payroll.  That has really afforded

  25     me to have good sleep at night.  It has given



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   2     me that assurance, because the payroll, it's

   3     very much a headache for a small business.

   4               One of the things that I appreciate

   5     that Citibank have done, many banks have been

   6     known to not want to deal with minority women

   7     owned.  The true testimony, this has not been

   8     the case.  Many banks have been known to

   9     redline.  We are located in East Flatbush,

  10     which is a predominantly immigrant population,

  11     and it is the new headquarters that, with the

  12     help of Citibank through SB loan, we got it at

  13     the lower rate with that assistance.  That

  14     really is a true testimony that they have met

  15     that criteria, which is a need in the

  16     neighborhood that we have, by lending to

  17     minority, by lending to a woman and by lending

  18     also in the East Flatbush minority-owned

  19     neighborhood.  The loan that we had, it was at

  20     a lower interest rate, which really helped us

  21     also.

  22               Once again, I am giving my support to

  23     this merger because I believe that it would be,

  24     much more programs would be beneficial to our

  25     community, and I support this merger, and I



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   2     also support the help that they are giving me

   3     and also thanking my bank manager and my

   4     personal banker.

   5               Thank you.

   6               MR. LONEY:  Thank you very much.

   7               It is good to sleep at night, isn't

   8     it?

   9               MS. JOHNSON-CLAXTON:  That was a big

  10     problem for me.

  11               MR. LONEY:  Mr. Gotto.

  12               MR. GOTTO:  Thank you, Governor Loney

  13     and panel.  I am pleased to be here today to be

  14     able to address this public meeting concerning

  15     the proposed Travelers/Citicorp merger.  My

  16     name is Alberto Gotto.  I am the Provost for

  17     Federal Affairs at Cornell University and the

  18     dean of the Joan and Sanford I. Weill Medical

  19     College in New York City.

  20               Here as the dean of the medical

  21     college in New York City, practicing physician

  22     and medical educator, I have no special

  23     credentials in business economic matters, but I

  24     do want to speak about an area in which I do

  25     have special and particular knowledge, and that



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   2     concerns the excellent corporate citizenship of

   3     the Travelers Group and its chairman and CEO

   4     Sanford I. Weill.

   5               Mr. Weill received his bachelors of

   6     arts degree from Cornell University in 1955

   7     and, of course, as we all know, he's had a

   8     remarkably successful career in business since

   9     then.  But just as remarkable as his business

  10     success has been the extraordinary degree to

  11     which Mr. Weill has volunteered his time,

  12     effort, his vision and his financial resources

  13     to support educational, civic and cultural

  14     organizations that make meaningful

  15     contributions to our society as a whole.

  16               Mr. Weill's been on the Board of

  17     Overseers in the medical college since 1982,

  18     and we have been especially fortunate to

  19     witness the depth of his dedication and

  20     commitment to enable Cornell State the

  21     cutting-edge of medical education, research and

  22     patient care.

  23               In 1995 he became the chairman of the

  24     Board of Overseers.  I'd like to just give a

  25     few examples to illustrate Mr. Weill's



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   2     commitment.

   3               He and Mrs. Weill endowed the Joan

   4     and Sanford Weill Medical Education Center

   5     which made it possible for us to introduce a

   6     problem-based learning curriculum.  This has

   7     been extraordinarily popular with our students

   8     and the faculty.  Cornell has currently over

   9     7,000 applicants.  We accept 100 medical

  10     students each year.  And, we wouldn't be able

  11     to do this program without this new educational

  12     center which provides one computer for every

  13     two students and really has state-of-the-art

  14     educational facilities.

  15               We are in the process of implementing

  16     a strategic plan.  We are expanding our

  17     research space by 25 percent and are increasing

  18     the size of our research faculty by recruiting

  19     30 new faculty in three areas -- structural

  20     biology, neuroscience, gene therapy and genetic

  21     medicine.  These are all going to be very

  22     important areas of research going into the 21st

  23     century.  It will enable us, we believe, to

  24     make New York more competitive in regaining our

  25     share of federal grants.



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   2               Mrs. Weill, on April, the 30th,

   3     announced a commitment, personal commitment of

   4     $100 million to fund this strategic research

   5     effort of the medical college.

   6               We for 30 years, Cornell Medical

   7     College, has had a Summer Minority Research

   8     Fellowship.  This has been highly successful.

   9     The program enrolls college juniors and seniors

  10     and gives an intensive summer experience.  Each

  11     student receives a stipend and housing, as well

  12     as travel expenses.

  13               From 1969 to 1983, we supported this

  14     with federal grants.  And in 1985, under

  15     Mr. Weill's leadership, the Travelers Group has

  16     stepped forward and provided an endowment to

  17     ensure the continuation of this program.

  18               Since 1969, more than 700 minority

  19     students have participated in this program, and

  20     an extraordinary number, over 90 percent of

  21     them, have gained admission to U.S. medical

  22     schools; over 100 of them have come to Cornell

  23     Medical School.  Cornell has one of the best

  24     records in the country in underrepresented

  25     minority students, one of the highest



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   2     proportion of underrepresented minorities of

   3     any medical school in the country.  We accept

   4     students on a needs basis, and 43 percent of

   5     the tuition is discounted with either grants or

   6     loans.

   7               We renamed the medical college in

   8     honor of Mr. and Mrs. Weill's extraordinary

   9     support of the medical college over the years

  10     and it is now the Joan and Sanford I. Weill

  11     Medical College of Cornell University.

  12               Mr. Weill, since 1991, has served as

  13     the chairman of Carnegie Hall's board of

  14     trustees.  He cochaired the steering committee

  15     to raise $60 million for Carnegie Hall, and in

  16     1997 was honored by New York State with the

  17     Governor's Arts Award.

  18               Just one final example, with regard

  19     to one of the comments of the earlier speakers

  20     about grants for minority businesses.  On July,

  21     the 15th, Mr. Weill and the Reverend Jessie

  22     Jackson will cochair a meeting under the

  23     sponsorship of the Rainbow Coalition to be held

  24     at Cornell Medical College.  Represented there

  25     will be corporations with $3 trillion of assets



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   2     and pension funds and the stated goal of this

   3     program is to provide money for minority

   4     businesses.

   5               I think Mr. Weill is amply dedicated

   6     or demonstrated his dedication both personally

   7     and through his leadership with Travelers and I

   8     am confident with this merger there will be a

   9     continuing and ongoing support of the community

  10     and civic activities throughout New York.

  11               Thank you.

  12               MR. LONEY:  Thank you, Mr. Gotto.

  13               Are there any questions?

  14               MR. ALVAREZ:  I had a question for

  15     Ms. Middleton.

  16               You suggested at the end of your

  17     remarks a list of things that you thought could

  18     be improvements.  I was wondering, you also at

  19     the beginning of your remarks mentioned a few

  20     of those same things that you thought City was

  21     doing now, some of the services, the lending

  22     programs, technical assistance and training.  I

  23     was wondering if you could differentiate a

  24     little bit for us or clarify a little bit for

  25     us the areas you thought City was stronger and



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   2     the areas you were pointing out where they

   3     could improve more.

   4               MS. MIDDLETON:  The area in which

   5     they were strong, in terms of providing the

   6     technical assistance to help to educate us, in

   7     terms of what kinds of banking accounts that we

   8     should open as a small not-for-profit business

   9     or as a for-profit business; also, the

  10     introduction to us about the PC Banking, which

  11     I was one of those that they are teaching;

  12     also, the area in terms of how to keep our

  13     records, how to pay our taxes.  They were very

  14     strong in the whole business area of

  15     developing, to help us to go forward and to be

  16     a part of the board so that we can continue on

  17     so we will not have, within two years, failed

  18     as we have done.

  19               The other areas I have mentioned, in

  20     terms of grants to small businesses, if you

  21     give us a loan and we have no capital, etc.,

  22     what happens?  You are giving us a loan for

  23     $70,000.  If our businesses fail or we begin to

  24     go under or we cannot keep the business going

  25     because we lack that continuity to keep going



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   2     forward, that would only mean that our business

   3     is going to fold, and what has happened in the

   4     Harlem community, many businesses have folded

   5     because of this, and then we end up paying the

   6     money back or we end up going to court because

   7     they are forcing us to pay the money back which

   8     we don't have.  So it has to come out our

   9     personal needs.

  10               So instead of giving us loans to

  11     start us out with, which is starting us out at

  12     a handicap, start us out at a mini-grant which

  13     we will then be able to develop and go forward

  14     from there.  That is our major problem, to be

  15     able to continue to go forward.  That is where

  16     at this point we need that kind of assistance

  17     and we are not getting it at this particular

  18     point.

  19               MR. ALVAREZ:  Thank you.

  20               MR. LONEY:  Any other questions?  If

  21     not, I thank you, our panel, very much.

Last update: December 3, 2010