Over the last five years, Santander’s lending in Providence’s minority neighborhoods has declined swiftly while its lending in predominantly white communities has grown, according to the lawsuit filed on Thursday in U.S. District Court for the District of Rhode Island.
For example, since the Spanish banking giant Banco Santander purchased Sovereign Bank in 2009, Santander’s applications and originations have dropped 60% in Providence’s minority neighborhoods. Meanwhile, applications and originations are up 14% and 25% respectively in white communities, the lawsuit claims.
The stark contrast in mortgage lending activity is due to redlining, the lawsuit says, and is a “substantial obstacle to minority neighborhoods’ full participation in the housing market recovery.”
Santander could not be reached for comment regarding this lawsuit.
“Many borrowers in minority neighborhoods are qualified for prime loans, but Santander has written them off,” said Providence Mayor Angel Taveras in a news release. “That holds down property values and the broad economic recovery that a healthy housing market can help generate in every neighborhood in Providence.”
The city of Providence is being represented by Relman, Dane Colfax.