Statistics tell two tales about Loyola CapitalIn Baltimore...

BANKING & FINANCE

October 14, 1993|By DAVID CONN | DAVID CONN,SOURCE: ACORN 'Take Stock in Md.' lengthened to 2 weeks STAFF WRITER

Statistics tell two tales about Loyola Capital

In Baltimore mortgage lending circles, Loyola Capital Corp. this week was labeled both hero and goat. It's a cautionary tale about the value of statistics.

In analyzing 1992 Home Mortgage Disclosure Act data, housing watchdog ACORN looked at lenders in various cities, including Baltimore. It found that Loyola, parent of Loyola Federal Savings Bank, ranked among the four companies in the nation with the highest minority-to-white rejection ratios. Loyola rejected 29 percent of black and Hispanic applicants, almost eight times the percentage of whites, says Washington-based ACORN (Association of Community Organizations for Reform Now).

Meanwhile, Loyola far surpassed other Baltimore lenders in the study in the percentage of mortgage loans made to minorities, at 22.8 percent. The next-best record was Provident Bankshares Corp.'s 13.5 percent.

"I can't argue with the statistics," said James McAveney, Loyola's chief financial officer.

But he says statistics ignore Loyola's efforts to attract minority XTC mortgage applicants, to review each rejected application from a minority, and to counsel them on how to improve their finances in order to get a loan.

"We do not tell someone, 'We don't think you'll qualify, so don't apply,' " he says. "We're incurring a significant amount of expense dealing with rejections."

Incidentally, Loyola does argue with ACORN's statistics. By the bank's estimate, only 10 percent of minority applicants were rejected last year, compared with 3.6 percent of whites.

Percentage of mortgage loans to blacks and Hispanics

Parent co. .. .. ..1990 .. .. ..1991 .. .. ..1992

Loyola .. .. .. .. .6.8* .. .. ..7.1 .. .. ..22.8

Provid. .. .. .. ..11.9* .. ....16.9* .. ...13.5*

Signet .. .. .. .. .9.2 .. .. ...4.0 .. .. ..10.8

Balt. Bancorp .. ..14.2 .. .. ...6.9 .. .. ...9.4

First Md. .. .. .. .4.5 .. .. ...5.5 .. .. ..5.9*

* fewer than 25 applications If you liked it last year, you'll love it this year.

Peremel & Co., the plucky Pikesville discount brokerage that brought you last year's "Take Stock in Maryland Week," has developed a new, improved version.

The company, once again, will cut sales commissions by 50 percent on the purchase of about 60 Maryland stocks. A minimum purchase is required, and other restrictions apply. This year's promotion runs twice as long, from Oct. 18-29, and Peremel convinced the governor's office to issue another proclamation for the "Take Stock" event.

"The whole basic idea, and what gets my adrenalin going, is it's really a great idea to get the local economy going," says Peremel President Howard Peremel. He figures it gets investors to invest, and they'll spend their money on locally-owned companies.

During last year's one-week promotion Peremel opened 450 new accounts, according to Vice President Ronald Peremel, up from 107 the previous month.

Ronald Peremel said the firm was thinking about organizing a Maryland economic summit to help promote this year's event, but the timing didn't work out for participants. Instead, the brokerage firm will highlight several companies and their CEOs, and might expand the cut-rate commission offer to the employees of those companies at different times throughout the year.

All this marketing has helped raise Peremel's revenues by 35 percent from last year, and earnings by almost 40 percent, Mr. Peremel said.

"It's taking hold," Howard Peremel added. "It's a great deal."

New access systems big success for Price

David Healy, vice president in charge of T. Rowe Price Associates Inc.'s telephone services, a year and a half ago started to overhaul the company's phone-based shareholder service system, which used to provide only mutual fund prices, yields and balances.

Now the Tele*Access system allows shareholders to buy and sell shares, to transfer money between funds and to order prospectuses, additional checks and even tax forms -- all without having to talk to a human being.

At some point during the redesign, Mr. Healy and his colleagues realized they could just as easily provide this stuff to personal computer users. PC*Access was born.

For the cost of a local phone call, shareholders with a computer and modem can tap into their account information, do all the things the Tele*Access service offers, and also read T. Rowe's educational material, such as retirement guides and college financial planning brochures.

"You can sit there and visualize things instead of listening to a voice and having to write it down," Mr. Healy says.

How well are these new services doing? Before the improved Tele*Access was launched on Sept. 1, the company was getting about 6,000 or 7,000 calls a day; after Sept. 1 calls shot up to 25,000 a day (before tapering off to about 15,000).

So far PC*Access, with almost no advance promotion, has attracted about 300 regular users. But that could accelerate now that T. Rowe is spreading the word more aggressively.

Ober is appointed to institute's board

Kudos to Douglas G. Ober, chief executive of Adams Express Co., the Baltimore closed-end mutual fund company. Mr. Ober was appointed this month to the board of governors of the Investment Company Institute, the mutual fund industry trade group.

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