Broadway Federal Bank
Broadway Federal Bank was founded in 1946 by a group of civic minded men and women who had identified the need for conventional loans to minority consumers who were ignored by all of the existing financial institutions. Broadway continues to fulfill the mission of providing conventional loans and in providing training for minorities desirous of entering the industry. The Bank’s mission is to serve the real estate, business, and financial needs of customers in underserved urban communities with a commitment to excellent service, profitability, and sustained growth.
Yelp Inc., the company that connects people with great local businesses, today announced it has deposited $10 million of its cash reserves with minority-owned financial institutions that support Black and underserved communities, including Broadway Federal Bank (Broadway), Carver Federal Savings Bank (Carver) and Citizens Savings Bank and Trust Company (Citizens Savings Bank). According to The Wall Street Journal, fifteen years ago America had 36 Black-owned banks,2 and today the FDIC reports only 20.3 Yelp selected Broadway, Carver and Citizens Savings Bank because of their immense impact on their respective communities.
A half-century ago, the federal government set out to attack the racial wealth gap by supporting Black-owned banks. Policy makers hoped the banks would lend to Black communities sidelined by the mainstream financial system. But five decades of federal financial and regulatory support have failed to boost America's Black-owned banks. The majority have disappeared under the burden of soured loans, bigger competitors created by mergers and financial downturns that hit small lenders hard. Fifteen years ago America had 36 Black-owned banks, government data show. Now there are 18. Now a new generation of entrepreneurs, companies and regulators is trying a different strategy. They are promising to strengthen Black-owned banks by building up their capital with private investments and giving them new ways to earn money with hundreds of millions in big corporate deposits. Their hope is that this approach will ultimately improve Black communities’ access to capital. CDBA Members Optus Bank, Broadway Federal Bank, and City First Bank of DC are featured in the article.
When two banks merge, it's often bad news for at least one of those bank's communities. They could be merging because one of the two banks has failed, and regulators from the Federal Deposit Insurance Corporation have brought in one bank to take over for the other. Or it could be a big bank buying up a smaller bank that is having trouble surviving because of regulations that currently tip the scales in favor of big banks. But what happens when two otherwise financially healthy community banks from across the country merge, willingly, to form a national bank? The residents of Black communities and other historically disinvested communities in Los Angeles and Washington, D.C. will have their chance to find out, with the announcement of a merger between Broadway Federal Savings Bank in Los Angeles and City First Bank of D.C.