PROVIDENCE – After reaching a $9 million settlement of redlining allegations by federal officials last week, The Washington Trust Co. has agreed to take additional steps to more equitable housing and financing opportunities for Rhode Island residents after discussions with the R.I. Office of the General Treasurer.
“We continue to make progress in discussions with Washington Trust to advance housing opportunities and financial equity in every community throughout Rhode Island,” R.I. General Treasurer James A. Diossa said in a statement Tuesday. “We have had meaningful and constructive conversations about the important role the state and local banks play in helping Rhode Islanders achieve financial success and home ownership, especially with communities of color.”
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The Westerly-based bank agreed to diversify its board of directors and leadership team to reflect the state’s population and to hold quarterly meetings between Diossa and Edward O. “Ned” Handy III, CEO and chairman of parent company Washington Trust Bancorp Inc.
The announcement comes after Diossa said on Sept. 28 that his office was reevaluating the state’s relationship with the bank, which holds $190 million in state deposits.
“We value Treasurer Diossa’s constructive cooperation and his commitment to expanding financial services and housing programs in underserved communities,” Handy said in a statement Tuesday. “Washington Trust remains committed to ensuring everyone in all Rhode Island communities has equal access to all our financial products and services. … We appreciate the input provided by the Treasurer and look forward to continued communication and collaboration.”
On Sept. 27, the bank agreed to a $9 million settlement with the U.S. Department of Justice in order to resolve allegations it had engaged in discriminatory lending from 2016 to 2021 by redlining Black and Latino neighborhoods in Rhode Island. The bank had denied the allegations, but said it joined the agreement to avoid legal costs.
According to a news release issued by Diossa’s office, the other actions the bank agreed to take include:
- Establishing a “diverse and inclusive” community advisory board that will include a representative from the Treasurer’s office and meet at least quarterly.
- Expanding its current paid advertisements on media outlets in underserved communities and communities of color.
- Continuing to expand its sponsorship of community and cultural events in Rhode Island’s communities of color.
- Working with the Rhode Island Hispanic Chamber of Commerce and continued support for the Rhode Island Black Business Association and the National Association of Hispanic Realtors’ Rhode Island chapter along with other organizations that offer residents of diverse community census tracts in the state lending area with support for credit financial education, homeownership and foreclosure prevention.
- Collaborating with the general treasurer to expand the bank’s financial literacy program to more urban school districts in the state.
- Sharing its Community Credit Needs Assessment with the general treasurer and taking recommendations to benefit underserved areas of the state.
- Expanding use and awareness of the bank’s homeownership programs.
- Supporting the state’s CollegeBound Saver 529 Plan.
