Open letter to Washington bankers

author : Dan Leahy topic : Emergency Economic Stabilization Act of 2008

by Dan Leahy

December 18, 2008

To: D. Michael Jones, President & CEO,

Banner Corporation, Walla Walla

Carol Nelson, President & CEO, Cascade Financial Corporation, Everett

Melanie J. Dressel, President & CEO,

Columbia Banking System, Tacoma

Brian L. Vance, President & CEO, Heritage Financial Corporation, Olympia

Roy M. Whitehead, President & CEO, Washington Federal, Inc., Seattle

Harold B. Gilkey, President & CEO, Sterling Financial Corporation, Spokane

From: Dan Leahy

1415 6th Avenue SW

Olympia, Washington 98502

Re: Public accountability: Preventing home foreclosures

The US Treasury is authorized to distribute $700 billion dollars in accordance with the Emergency Economic Stabilization Act of 2008. Thus far, the Treasury has distrib-uted $165 billion to eighty-seven banks.

Your six banks are the only ones in Washington State to have received part of this $700 billion, as of December 9, 2008. The Treasury has sent your banks $766,868,000, with Sterling Financial Corporation receiving the most at $303,000,000 and Heritage Financial Corporation the least at $24,000,000. (Chart Attached).

Elizabeth Warren, Chairperson of the Congressional Oversight Panel, wrote in her first report that “all Americans have a right to ask: who got the money, what have they done with it, how has it helped the country and how has it helped ordinary people?” (COP, First Report, 12/10/08 p.6).

Thanks to Ms. Warren’s report we know you “got the money.” Now we want to know what you have done with it and, most especially, how has it helped ordinary people, like, for example, the one in ten mortgage holders now in default and unable to make payments on their homes.

I’m working with people, unions, and neighborhood associations throughout the state to disseminate accurate information about the use of these funds to prevent home foreclosures. An explicit purpose of the Act under which you received millions is to “prevent avoidable foreclosures.”

Please respond to my letter no later than Monday, January 26, 2009, indicating your program of loan modifications, principal reductions and moratoria by which you in-tend to prevent home foreclosures in your regional service areas. Your letter will help dispel the persistent rumors that, contrary to the Act, recipient banks intend to use these tax dollars to expand their operations by purchasing weaker banks rather than helping ordinary people.

I have sent this letter to the daily newspapers servicing your six respective cities and I will also send your response to them.

Thank you for your attention to this matter.

Cc: Elizabeth Warren, Chairperson, Congressional Oversight Panel

Rob McKenna, Attorney General, State of Washington

Brad Williamson, Division Director, Washington State Division of Banks

Hon. Patty Murray, US Senator

Hon. Maria Cantwell, US Senator