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A Baltimore neighborhood street
(Kaitlin Newman / Baltimore Sun)

A Washington-based fair lending advocacy group released a report Tuesday that said banks in Baltimore lend to those in the city's predominantly white neighborhoods far more frequently than they lend to those in predominantly black neighborhoods, an issue not seen in the suburbs.

The analysis used data that banks provide to the federal government under the Community Reinvestment Act, which includes race and income but not credit scores or other factors used to judge an applicant's creditworthiness.

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While the National Community Reinvestment Coalition found that banks were lending in some middle-class, majority black neighborhoods, such as in Northeast Baltimore, "it didn't rise to a level of significance in our statistical analysis," said Bruce Mitchell, an author of the report.

The racial composition of a neighborhood in Baltimore was the biggest predicting factor in obtaining a loan, the group found.

"I call it borrowing while black," said John Taylor, president and CEO of the advocacy group. "Essentially it's hard to find a branch to borrow from, when you do find one, you're stopped from getting home loans or business loans. ... This has contributed to the dense poverty and made it more dense than it should have been."

Kathleen Murphy, president of the Maryland Bankers Association, said she didn't think the report reflected reality and that such analyses are difficult to do because of the lack of detailed financial data available.

"Quite frankly, I'm taken aback by this report," Murphy said. "What I see are community leaders and banks working together. We don't condone discrimination in lending in any form. The picture of the banking industry in this report is completely contrary to what I see."

The report found that in Baltimore's suburbs, a borrower's financial status was the determining factor in getting a loan. But in the city, African-American borrowers would find it "very difficult" to get a mortgage, even if they were in a low-to-moderate income area, rather than in a low-income area, according to the report.

Baltimore's white borrowers were approved for loans 75 percent of the time, while black borrowers were approved 61 percent of the time. Asians and Hispanics were approved 65 percent and 62 percent of the time, respectively.

Black borrowers in the suburbs were approved for loans more than 67 percent of the time compared to more than 78 percent for their white counterparts, but the report's authors said economic factors accounted for the difference.

Lenders have faced complaints before about lending discrimination in Baltimore. For example, Wells Fargo Bank agreed to pay $175 million in 2012 to settle allegations it discriminated against minority borrowers in a nationwide case that originated in Baltimore.

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