Virg Bernero says he’d cut state business with banks that won’t lend in Michigan

Bernero says no to banks that won’t lend in Mich.

LANSING, Mich. — Democrat Virg Bernero said Thursday he’ll stop the state from doing business with banks that won’t lend in Michigan if he’s elected governor.

He specifically mentioned Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc., PNC Financial Services Group Inc. and Wells Fargo & Co., criticizing them for refusing to participate in the state’s Helping Hardest Hit Homeowners Fund.

Democratic Gov. Jennifer Granholm has appealed to the same banks to join the federally funded program, which would provide financial assistance for homeowners struggling to keep up with their mortgage payments.

Bernero also said the banks should be helping more Michigan small businesses get access to the credit they need to expand and hire more workers.

“We are being robbed of our recovery as a result of the lack of capital,” Bernero told reporters after unveiling his plan to about a dozen Lansing residents during a campaign stop at a downtown coffee shop. “If Wall Street doesn’t want to do business with us, then we won’t do business with Wall Street.”

The Lansing mayor also repeated his proposal to have Michigan follow the lead of North Dakota and open a state-owned bank that could make low-interest loans to businesses and college students.

Among the banks Bernero said are benefiting from state business is JPMorgan Chase, which he said the state pays to manage a fund relating to the state’s cash flow.

But the state has far more ties to the banks than Bernero mentioned. As of Wednesday, the State of Michigan Retirement Systems had $650 million in common stock holdings in banking firms Bernero criticized, about 1.4 percent of the total, Treasury spokesman Terry Stanton said.

That included $246 million in stock in Bank of America, $163 million in Citigroup, $135 million in JPMorgan Chase, $88 million in Wells Fargo and $17 million in PNC.

Michigan Bankers Association spokeswoman Gail Madziar wasn’t impressed with Bernero’s proposal to lock out the banks.

“He should be providing a plan to show the ways he would bring jobs to Michigan and go from that point of view rather than attacking businesses already here,” she said.

A spokesman for Bernero’s Republican rival, Rick Snyder, also criticized Bernero for not coming up with better ways to help Michigan’s economy recover.

“There’s a credit crunch all over and that’s an issue that has to be dealt with … (but) the populist platitudes won’t create a single job here in Michigan,” spokesman Bill Nowling said. “Rick has made it very clear we are not going to attack businesses. There has been far too much of that from the Democratic side of the ledger.”

Online:

Bernero campaign: www.votevirg.com

Snyder campaign: www.rickformichigan.com