FOR IMMEDIATE RELEASE                                          CR
TUESDAY, JANUARY 28, 1997                          (202) 616-2777
                                               TDD (202) 514-1888


     WASHINGTON, D.C. -- First National Bank of Dona Ana County,
the largest bank in Las Cruces, New Mexico, will pay $585,000 for
allegedly discriminating against Hispanic home loan applicants,
under an agreement reached today with the Justice Department.

     Over the past five years the Justice Department has filed
eleven lending discrimination cases against financial
institutions, ten of which were resolved by voluntary settlements
resulting in more than $20 million in damages and penalties. 
Today's case is the first to challenge discriminatory practices
in mobile home lending.

     Today's settlement, submitted together with a complaint to
the U.S. District Court in Las Cruces, resolves allegations that
the First National Bank of Dona Ana County engaged in a pattern
of discrimination against Hispanic borrowers seeking financing
for mobile homes, in violation of the Fair Housing Act and the
Equal Credit Opportunity Act.
     "The Justice Department will continue its effort to root out
discrimination in the lending industry," said Acting Assistant
Attorney General for Civil Rights Isabelle Katz Pinzler.  "A
significant portion of residents around Las Cruses live in mobile
homes.  Mobile home residents should not be denied the credit
they may need to secure a place to call home."

     The settlement resolves allegations that the bank unfairly
denied loans to Hispanics trying to purchase mobile homes by
applying more stringent underwriting standards to Hispanic
applicants than those applied to similarly situated Anglo
applicants.  The bank also allegedly made greater efforts to
obtain information from Anglo applicants to help their chances of
qualifying for a loan compared to efforts made in processing the
applications of Hispanics.

     Pinzler noted that the bank fully cooperated with the
Justice Department's investigation, and voluntarily took steps to
improve its fair lending record.  The investigation focused on
the bank's practices between January 1992 through March 1995.

     Under the settlement, the bank will:

         create a $485,000 fund which will be used to compensate
          Hispanics who were allegedly unfairly denied mobile
          home loans; 

         create a $750,000 subsidized mobile home loan fund-
          -estimated to cost the bank $100,000--designed to
          redress the past alleged discriminatory practices of
          the lender; 

         take steps to ensure that all applicants seeking
          mortgage credit are treated in a fair and
          nondiscriminatory manner; 
         conduct a program of community outreach to the Las
          Cruces Hispanic community which includes home buyer's
          seminars and distribution of information on the
          lender's mortgage programs. 

     "The First National Bank case is important because entry
into the middle class couldn't happen without equal access to
credit and housing opportunities," said John J. Kelly, U.S.
Attorney in Albuquerque, New Mexico.  Kelly also noted that this
is the second settlement in recent months involving
discrimination in southern New Mexico against Hispanics.  In
December, the Village of Hatch resolved a Fair Housing Act suit
with the Justice Department.

     According to the 1990 census, more than 25% of all housing
units in the Las Cruces area were mobile homes.  Fifty-six
percent of those were occupied by Hispanics.

     The Office of the Comptroller of the Currency, which
supervises national banks such as Dona Ana, aided the Justice
Department in its investigation. 
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