Distressed groups — whether Black urbanites or white, rural shopkeepers — have long striven, unevenly, for economic self-sufficiency as a means of mobility. Typically, Wall Street-centered firms haven't had their backs. But, in many cases, smaller banks have. If you want to help minority-owned businesses, the first best thing is to shop local. But there's a next best thing, which is to move your deposits into Black-owned banks or community banks in general. Featuring Carver Federal Savings Bank.
Darrin Williams thinks it was probably a Fox News interview he did in early April that caught the eye of the White House and got him invited later that month to a videoconference with President Trump, his daughter Ivanka, and other top advisers. Williams is one of only a handful of Black CEOs at financial institutions with more than $1 billion in assets. At $1.6 billion, Southern Bancorp is a minnow next to the trillion-dollar-size whales that more commonly have access to Trump. But in this conversation, just four days after the federal government rolled out the Paycheck Protection Program to provide $350 billion in loans to keep small businesses alive, the little bank in Arkansas emerged as the most relevant.
The U.S. Department of the Treasury's Community Development Financial Institutions Fund (CDFI Fund) released the application data for the fiscal year (FY) 2020 round of its Capital Magnet Fund program. A total of 137 organizations submitted applications requesting more than $642.2 million in funding. The applicants propose to serve 50 states, the District of Columbia, Guam, and Puerto Rico. In total, 53% of the applicants are certified Community Development Financial Institutions (CDFIs), and the remaining 47% of the applicants are non-profit affordable housing organizations.
Mastercard has announced it is launching a massive $500 million investment into Black communities amid the coronavirus pandemic, which has hit those groups disproportionately hard. The initiative — announced Thursday — also comes on the heels of a summer that has seen nationwide protests and the resurgence of the Black Lives Matter movement following the killing of George Floyd, a Black man, by a white police officer at the end of May. Split into three main parts, the investment will focus on making financial tools and services more affordable and accessible for Black communities as well as investing heavily in Black-owned small businesses.
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.
The U.S. Department of the Treasury's Community Development Financial Institutions (CDFI) Fund has awarded $25.2 million to 138 community banks and thrifts serving America's most economically distressed communities. Of the awardees, 68 are members of the Community Development Bankers Association (CDBA), who received a total of over $13.5 million in awards (nearly 54 percent of the total award dollars). Over 97 percent of CDBA members awarded this year received the maximum grant amount of $202,898.
The COVID-19 public health crisis coupled with the protests around the country calling for racial justice have made one thing clear: We must use this opportunity to confront and address long-standing issues of racial equity and access to capital and opportunity in this country. Whether we come out of this moment stronger or not depends on how we take action to change economic and social disparities. This is why Harbor Bank and JPMorgan Chase are partnering to make long-term investments that shift the economic future of underserved communities in Baltimore and across the region.
The Board of Governors of the Federal Reserve will vote on the Advanced Notice of Proposed Rulemaking on the Community Reinvestment Act Regulation on Monday, September 21 at 10am Eastern Time. The meeting is open to the public, but due to the current coronavirus pandemic, the public may observe this Board meeting via a live webcast on the Board's website.
Today, the National Community Reinvestment Coalition (NCRC) and Morgan Stanley (NYSE: MS) announced a $15 billion, four-year community benefits plan that will increase the financial services company's lending and investments in lower-income communities. Under the plan, developed as part of the financial services company’s application to acquire E*TRADE Financial Corporation (NASDAQ:ETFC), Morgan Stanley’s lending and investments in low- and moderate-income (LMI) communities and communities of color will increase by 43% annually over previous levels from Morgan Stanley and E*TRADE.
On June 2, Bank of America made a $1 billion, four-year commitment to advance racial equality and economic opportunity. Today, the company is announcing its initial progress by directing one-third, or $300 million, of its $1 billion commitment to four key areas across 91 U.S. markets and globally: $25 million in support of jobs initiatives in Black and Hispanic/Latino communities, $25 million in support of community outreach and initiatives, $50 million in direct equity investments to Minority Depository Institutions (MDIs), and $200 million of proprietary equity investments in minority entrepreneurs, businesses and funds. MDI recipients will include First Independence bank and Optus Bank.