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"Does your bank discriminate in its lending policies and practices?"

That's the uncomfortable question that Ronald W. Tigner posed to the 350 members and spouses of the Utah Bankers Association gathered here for the trade group's 86th annual convention.Uncomfortable or not, it's a good bet that not one of the bank executives answered "yes" on the "Fair Lending Checkup" Tigner had asked them to fill out.

"But are you absolutely sure?" he prodded them from the podium in the Sun Valley Opera House where the sessions have been held. By the time they had finished the questionaire and Tigner, director of the Community Development Center for the American Bankers Association, had finished explaining the technicalities of the Equal Credit Opportunity Act and the Fair Housing Act, it was clear that fair lending is a minefield for financial executives with even the best of intentions.

Some sample questions: "Can you unequivocally state that no employee in your bank treats, subtly or overtly, customers differently on the basis of race, sex or presumed income?"

- "Has your bank's board of directors adopted a formal, written policy that demands equal treatment for all customers? If so, is it reviewed annually?"

- "Are you sure that the legitimate reasons given for adverse actions on loans and loan applications are documented and supported in the files?"

And on it goes, some 30 such questions, and all of them, assured Tigner, critically important. "It's not just a compliance issue and an ethical issue, it's a bottom-line issue as well," he said.

Tigner, a former banker before joining the ABA, assured the Utahns that their record for fair lending practices is among the best in the nation. But he noted that acceptable standards of the past will be found wanting in the future as even unintended lapses may be cause for litigation.

"I believe that 99.9 percent of the banks in this country do not discriminate . . . intentionally," said Tigner. "But you may have problems you are not even aware of. I know that some bankers are in denial on this issue, but I can tell you that if you are not absolutely sure your bank is a fair lender you are taking a big risk."

Tigner, who is black, said most bankers automatically assume fair lending applies only to race. Not so, he said, discrimination against women and senior citizens is also included in the law.

"This is a very complex area, but it can't be avoided. You must train everyone in your bank who meets the public. One of your tellers can trigger a violation without even knowing it until it's too late."

Such small things as helping one borrower fill out an application but not another can put a bank in violation, said Tigner. Or explaining a credit lapse to one person who gets behind in a loan payment while dunning another with a letter, without a courtesy phone call, is also a violation.

Even some policies or practices that are applied absolutely evenly to all customers but that tend to more adversely affect one group over another can be a violation, said Tigner. He used the example of a bank having a policy against making mortgage loans of less than $60,000 as a practice that falls more heavily on low-income and/or first-time home buyers.

"We have a great challenge ahead of us, as you can see," said Tigner. "I hope we rise to it by reaching for the carrot, not to avoid the stick."

Tigner told the bankers they should react to fair lending as an opportunity to open up new markets for bank products among groups of people who are not traditional bank customers.

"If we don't," he said, "you can be sure that others, such as The Money Store, will take that business. The future of banking is in diversity and if Utah banks are to have a future, all segments of the populace must have access to banking services."