In a first-in-the-nation settlement after a landmark U.S. Supreme Court decision, the city of Philadelphia has agreed to resolve its discriminatory lending claims against Wells Fargo Bank for $10 million.

The agreement between San Francisco-based Wells Fargo and Philadelphia is the first resolution of a lawsuit lodged by a municipal government against a financial institution since a 2017 U.S. Supreme Court ruling established standing for them to sue banks over discrimination.

Mayor Jim Kenney's office announced the settlement Monday morning, saying that, under the agreement, the bank will contribute $10 million for sustainable housing-related programs aimed at promoting and preserving homeownership for low- and moderate-income Philadelphians. The resolution comes a year after the litigation was sent to mediation.

Duane Morris attorney Alexander "Lex" Bono represented Wells Fargo and Berger Montague attorney Sherrie Savett represented Philadelphia, along with attorneys from the City Law Department.

In a joint press statement, Kenney said the agreement should provide "substantial support" to communities that need assistance the most.

"Home ownership brings stability, security and pride—in yourself, and in your community," he said. "Philadelphians who struggle amid poverty need assurance that they face a level playing field as they work to achieve that dream."

Joe Kirk, Wells Fargo region bank president, Greater Philadelphia, said in the statement that the result is consistent with the company's broader philanthropic strategy.

"We're pleased that we've been able to resolve this matter in a way that will provide real, tangible sustainable homeownership opportunities for many low- and moderate-income residents of Philadelphia," he said.

Although Philadelphia's suit was the first to go forward since the Supreme Court established standing for municipalities in Bank of America v. City of Miami, it was not the first municipality to sue a financial institution for allegedly discriminatory lending practices. Cities including Baltimore and Memphis had brought similar claims against Wells Fargo, as have the U.S. Department of Justice and the Federal Reserve Bank. Several media reports have said an attorney arguing on behalf of Miami before the Supreme Court said Baltimore and Memphis each settled their claims for less than $10 million.

According to the release, the agreement includes $8.5 million in grants that will be used to cover down payment and closing costs for low- and moderate- income home buyers. Those grants will be administered through the city's Housing Development Corp., and there is no requirement that home buyers would need to have a Wells Fargo loan to qualify for the money, the release said.

One million dollars will go to the three nonprofits implementing the city's Residential Mortgage Foreclosure Prevention Program, which helps streamline the legal process and keep low-income and minority residents in their home, and the remaining $500,000 will bolster the city's land care program. The announcement also said Wells Fargo will set up an internal program to analyze the history of the housing market in Philadelphia to better understand the current housing needs in the city's diverse neighborhoods.

City Solicitor Marcel Pratt said in the release that, from the outset of the litigation, the city had focused on getting direct relief to the neighborhoods.

"One of the advantages of this resolution is that we secured valuable benefits that would not have been available through pursuing our litigation for city government's injuries under the Fair Housing Act," Pratt said. "As a result, we are providing tangible, significant benefits directly to our communities and residents."

Philadelphia filed its suit in May 2017, focusing on lending practices that occurred between 2004 and 2014. The city contends that the allegedly discriminatory conduct caused high foreclosure rates in minority neighborhoods and lowered tax revenues that the city otherwise would have collected. According to the city's complaint, during those 10 years Wells Fargo issued more than 1,000 discriminatory high-cost or high-risk loans to minority borrowers. The loans were clustered in neighborhoods in the north, west and southwest areas of the city that have high poverty rates and significant African American and Hispanic populations, the complaint said.

Wells Fargo, however, fought back in a motion to dismiss, contending that the city's arguments were too much of a stretch to proceed and would require six steps to establish a connection between any allegedly discriminatory loans and the city's claimed injuries.