Boston Mayor Thomas M. Menino wants to know why so many worthy consumers are being denied mortgages – like many officials, he’s concerned banks’ lending standards are unreasonably high. Daring lenders to prove him wrong, he stood last week at a Federal Reserve housing conference and called for bankers to file quarterly reports that would detail lending activities.

A Banker & Tradesman analysis of data from The Warren Group, its parent company, shows that while some smaller local lenders have maintained or grown their mortgages in the city, bigger banks have pulled back noticeably over the past several years. B&T examined the market share of individual lenders, both citywide and by neighborhood, for the first quarter of the past three years and 2005, the peak of the housing bubble.

By examining specific lenders’ market share, in terms of number of loans originated, B&T attempted to show if Menino’s speculation that some lenders were “freezing out” borrowers was correct. If a certain lender’s market share dropped drastically between the heady days of the housing bubble and today, it could be inferred that, indeed, they had pulled back from the market and were not making as many loans locally as they might be able to.

The figures cannot give indications of which individuals are being denied loans or what kind of standards lenders are setting, but offer a broad picture of overall home lending activity in the city.

A Mixed Bag

The data offers mixed conclusions, depending on how it is interpreted.

On one hand, lenders like Bank of Canton, Mortgage Master and Greenpark Mortgage have taken advantage of market demand to increase lending – albeit gradually. For the first quarter of 2010, most neighborhoods saw the return of some lenders who’d abandoned them during a citywide lending low in 2009.

But those smaller lenders’ efforts don’t nearly make up for the dwindling presence of giants such as Bank of America, Sovereign, and Wells Fargo, or especially the near-vanishing of companies like JP Morgan Chase.

Indeed, it’s obvious that far fewer loans are being made overall: In the first quarter of 2005, lenders made nearly 1,700 purchase loans. In the same period in 2010, they made only about 800.

Of course, a great many of those loans came from now-dead companies, and the data shows just how drastically the market has cleared out. In the first quarter of 2005, the lenders’ list is dotted with lenders such as Washington Mutual, Summit Mortgage, Argent and others that are no longer lending in the area or no longer lending at all. For example, 16 of the top 25 lenders of Q1 2005 were not only out of the top 25 by 2010, they didn’t lend in Boston at all.

That’s as it should be, said Cornelius Hurley, director of the Morin Center for Banking and Financial Law at Boston University, who said the market prior to the housing crash was riddled with “inappropriate” loans and sloppy lenders.

Big Banks Back Off

But Tom Callahan, executive director of the Massachusetts Affordable Housing Alliance, agreed with the mayor’s belief that surviving lenders – particularly giants like Sovereign, Citibank and Bank of America – haven’t done nearly enough to fill the gaping void in the lending market, particularly for affordable and first-time home loans.

JP Morgan Chase did 38 loans citywide in 2008’s Q1, but only four in 2010. Citimortgage, the mortgage arm of Citibank, went from 25 loans citywide to just five.

Even for still-prominent lenders, there’s been pullback. Consistently No. 1 in the city, Bank of America’s loans have slumped year by year. In 2008, it made 215 loans, then 125 in 2009. In this year’s first quarter, that was down to 104.

With regard to the amount of lenders in each neighborhood, the numbers look positive. Neighborhood by neighborhood, a pattern repeats itself: A horde of 2005 lenders vanishes, with the pack diminishing until it hits a nadir in Q1 2009. But this year, the number of lenders actually started to creep upward in some neighborhoods, including Roslindale, South Boston and Hyde Park.

In overall purchase loans from 2008 to 2010, a few areas were holding steady: for example, Charlestown had a terrible Q1 2009 with only 33 purchase loans, but rebounded nicely in 2010 with nearly 50 loans – back to its 2008 level of 51.

That does not constitute a victory, Callahan said. With the enormous amount of defunct lenders departing the marketplace, “You’d expect new entrants to pick up slack, and you’d expect existing institutions to increase their number and share of loans to replace the lost lenders … holding flat in terms of numbers is not necessarily a positive thing.”

A Reasonable Request?

Menino specifically called for quarterly reports of lending activity, a request Callahan found reasonable. Lenders are currently required to detail activity annually thanks to the federal home Mortgage Disclosure Act, Callahan said, which comes at a long delay. For instance, 2009’s figures were due in March, and won’t be released to the public until the summer.

But Hurley said an across-the-board requirement that banks turn in yet more information creates a needless extra burden. Information requirements already in place are sufficient, and details on lending activity are readily available for those who look.

“If I were advising the mayor, I’d say ‘start with what is already available, rather than add on another layer of reporting and bureaucracy,’” he said, adding that these requests smacked more of political posturing than a good faith effort to help.

“Do you want to have a press conference, or do you want to get at the underlying issue?” Hurley said.