Recent News
New Biden administration rules overhauling the way small business loans are doled out will potentially leave thousands of sole proprietorships and the self-employed on the sidelines, despite the president's pledge to give them better access to pandemic aid. The Small Business Administration quietly decided that the benefits that President Joe Biden promised to "one-person businesses" won't be available to many of those who have already received aid from the program. The agency concedes those businesses were shortchanged under earlier rules — some received as little as $1 because of the way... Read more
Kathryn Smart was struggling to make ends meet at the start of England's latest lockdown. The 45-year-old usually earns £1,100 a month working at a debt collection agency in Sunderland, but reduced her hours to help home-school her six-year-old son. Smart needed money to tide her family over, but knew she would not qualify for a mainstream loan. A bad experience with payday lenders several years ago left her with £3,000 worth of debt and a poor credit score. With a contentious county court judgment (CCJ) also on her file, she Googled “loans offered to borrowers with CCJs” and found Fair... Read more
In its largest award round to date, the U.S. Treasury Department's Community Development Financial Institutions (CDFI) Fund announced Feb. 22 that more than $175.4 million in Capital Magnet Fund awards (CMF) have been distributed during its sixth funding round. The fiscal year (FY) 2020 award round also saw the largest number of award recipients with 48 organizations receiving funds. The 48 awardees were selected from 137 applications, which requested more than $642.2 million in awards this CMF round. Congratulations to CDBA members Beneficial State Bancorp, Inc., Central Bank of Kansas... Read more
Two CDBA member bankers were featured on NPR's Marketplace program in late February. Robert James II, Director of Strategic Initiatives at Carver State Bank, was on the February 22 program to discuss hiring at black-owned banks and the Paycheck Protection Program rollout. Dominik Mjartan, President and CEO at Optus Bank, was on the February 24 program to discuss small business recovery during the pandemic.
Carver Bancorp, Inc., the holding company for Carver Federal Savings Bank, a certified Minority Depository Institution (MDI) and Community Development Financial Institution (CDFI), announced that JPMorgan Chase has made a long-term equity investment of approximately $6 million in common and preferred shares of the Company. JPMorgan Chase's equity investment represents approximately 3.4 percent of the Company's issued and outstanding common stock at purchase. In addition, the investment includes 5,000 shares of the Company's Series F preferred stock. Carver expects to utilize the... Read more
While people are feeling the ongoing impact of the pandemic, Money/Finances is the No. 1 driver of stress for them, according to the second annual Huntington "Money Mindset" survey, a barometer on financial wellness. "Stress related to money and finances is a clear reflection of the challenges many people are having during these difficult times," said Andy Harmening, Huntington's president of Consumer and Business Banking. "Personal finances are often about planning, and we want to do everything we can to help people better understand where their money is going in an effort to look... Read more
As President Biden continues to select hundreds of key personnel to serve as the new administration, one crucial seat remains open: the next comptroller of the currency. The person who fills this role will have a profound impact on the entire banking industry over the course of their term. But there are two groups of financial institutions that have a particularly large stake in the game — community development financial institutions (CDFIs) and minority depository institutions (MDIs). But to keep this mission ongoing, it will require stronger partnerships between financial institutions... Read more
Fernando Tatís Jr. was 18 years old, just a low-level prospect from the Dominican Republictrying to work his way up in the San Diego Padres farm system, when he made a financialdeal that would impact his entire baseball career. And it wasn't with the Padres. Tatís signed a contract with Big League Advance, an unusual investment fund that paysminor-league players money up front in exchange for a share of their future MLBearnings. Tatís, now 22 and widely viewed as one of the sport's best young stars, today knows whatthose earnings will be. He agreed to a record-setting 14-year contract with... Read more
The Federal Deposit Insurance Corporation (FDIC) today named Sultan Meghji as the agency's first Chief Innovation Officer, charged with leading the FDIC's efforts to promote the adoption of innovative technologies across the financial services sector. Mr. Meghji co-founded Neocova, a financial technology firm providing secure, cloud-native, artificial intelligence-based software for community banks and credit unions. In addition, he worked on an aid mission to help implement digital banking in Kenya, Tanzania, and Uganda, and worked with fintechs and central banks to create... Read more
City First Bank is pleased to announce that Sonja Sanders Wells has been promoted from Senior Vice President, Interim Chief Lending Officer to Executive Vice President & Chief Lending Officer (CLO), leading the commercial banking group. Sonja Wells is the only African American woman to hold a CLO position at a bank in Washington, DC. In fine tradition, Ms. Wells follows in the trailblazing footsteps of City First’s selection of its first CLO, Ms. Kim Saunders in 1998, alongside the founding President & CEO, Ms. Debbi Baptist Hurd -- rare Black women executives positioned in the C-... Read more
An NBC News analysis last year of PPP data, census records and a leading economic distress indicator show that struggling American communities received less from the PPP program proportionally than the country's wealthier and more vibrant neighborhoods. Economically distressed communities — in which minorities make up a greater share of the population than more prosperous communities — fared worse than the country's wealthiest communities when it came to getting Paycheck Protection Program loans. Shortly after the PPP got more funding from Congress in late April, the SBA began to position... Read more
For the second time in his career, entrepreneur Ken LaRoe decided to start a bank after being inspired by a book he read. This time it was "Drawdown" by Paul Hawken, and the new bank LaRoe seeks to open, to be called Climate First Bank, would enact some of the environmental principles it lays out. LaRoe chose Finastra as his primary tech partner based on its commitment to climate change as well as its ease of use and overall customer experience. The bank is expected to open in St. Petersburg, Fla., in May, provided it receives the necessary federal and state approvals, LaRoe said. In an... Read more
Black-owned businesses were among the last to receive paycheck protection loans last year. Now, some businesses are turning to banks that specialize in working with Black and brown customers. Carver State Bank, was founded 94 years ago with a goal of building financial freedom for its African American customers. Eighty percent of its loans go to Black-owned businesses. Robert James, who sits on the bank's board, says he received PPP applications from around the country, most looking for less than $50,000.
Visa Inc is teaming with Boston-headquartered OneUnited Bank, the nation's largest Black-owned bank, on a campaign designed to mitigate the racial wealth gap. What Happened: The new OneTransaction Campaign will encourage Black families to select one financial goal to accomplish in 2021 while providing strategies for achieving that goal. That transaction could range from improving a credit score, setting up an investment portfolio or an automatic savings account, taking out a life insurance policy or writing a will. The campaign will culminate with a virtual financial conference held on... Read more
NCIF invited 10 partner CDFI and Minority Banks to identify small business customers that are integral to their local communities and needed support to sustain their respective businesses through the pandemic. NCIF used over $100,000 of its own funds to pilot an unrestricted microgrant program as gap funding to these customers. Our first batch of microgrants was given to social entrepreneurs, retail businesses, community facilities, affordable housing organizations, arts nonprofits, and other small businesses across the country. These CDBA members are First Southwest Bank, Carver Federal... Read more
Of the roughly 30 million small businesses in the United States, 22 million are individually operated, meaning the owner is the sole employee, according to the U.S. Chamber of Commerce. There are few concrete numbers for how many of those businesses have permanently closed in the past year, but some early estimates have put the figure anywhere from 80,000 to 160,000. It will likely take years for the full extent of damage from the pandemic to be felt in the broader economy. The pandemic has shaken even the most prepared business owners, and nonwhite business owners have been hit especially... Read more
The American Dream has evolved just as America has evolved, but today, homeownership has emerged as the primary public policy tool for helping Americans achieve wealth and self-reliance. Nearly two-thirds of the nation's 140 million housing units are owner-occupied, conferring an average net housing wealth to those owners of over $150,000.
This is a statistical way of saying that buying a home is the main way Americans obtain real, tangible wealth. But white Americans today enjoy the equity-building benefits of homeownership at significantly greater rates than nonwhites. In the third... Read more
Structural racism and the persistent racial wealth gaps are at the forefront of many public policy debates today, and a big part of that debate is how to increase diversity in employment practices. These problems — and debates over remedies — are alive and well in the financial service industry. A recent report of the majority staff at the House Financial Services Committee noted that the financial services industry "remains mostly white and male," concluding that "more work is needed." Numerous research reports show that racial and ethnic diversity leads to greater productivity and... Read more
When people come to live in the U.S. from other countries, they often don't have an American credit history, identification or other typical requirements of the account-opening or loan process. But community banks are finding ways to serve this growing population while mitigating credit and compliance hurdles. Spring Bank and Sunrise Banks are featured in this article.
After four decades in the banking industry, Jane Henderson plans to retire this year as President and CEO of Virginia Community Capital (VCC). As the organization's founding executive director, Henderson has led VCC since its inception in 2006. Her banking career includes 29 years spent in community development finance. VCC, a community development financial institution (CDFI), was born out of a $15 million investment and a vision for an institution that served Virginia's most under-resourced communities.