The U.S. Department of Housing and Urban Development announced on Wednesday an agreement with First-Citizens Bank & Trust Company resolving allegations that the bank denied mortgage loans to African-American, Latino and Asian-American mortgage applicants at a disproportionately higher rate than white applicants.

HUD filed its initial complaint in 2011 after reviewing 2010 Home Mortgage Disclosure Act data, before the South Carolina bank was sold to Raleigh-based First Citizens BancShares Inc.  After the change in ownership, the successor North Carolina company continued to cooperate with the investigation, the housing agency said.

As part of the settlement, First Citizens agreed to take several actions:

  • Refrain from unlawful consideration of race or national origin in marketing, picking sites for branches and services, and defining minority-lending areas under the federal Community Reinvestment Act.
  • Make $140,000 available to nonprofits that provide credit and housing counseling, financial literacy training and related programs to first-time homebuyers in South Carolina.
  • Provide an objective secondary review of residential mortgage applications that are denied by the bank’s automated underwriting system.
  • Require all employees and company agents who are involved in manual mortgage underwriting to attend four hours of training in fair lending policies.
  • Hire by Sept. 30 three market specialists to focus on diverse mortgage lending in the Charleston region, Columbia and the Upstate metro areas.
  • Conduct at least 24 financial education programs in South Carolina for individuals and small-business owners in coordination with nonprofits or community groups.

“This agreement aligns our shared goals of promoting fair housing and expanding access to credit for qualified working families,” Gustavo Velasquez, the department’s assistant secretary for Fair Housing and Equal Opportunity, said in a statement. “HUD will use its enforcement powers to ensure that everyone has equal access to credit regardless of what they look like or where they come from.”