Recent News
This year has certainly tested bank executives' ability to manage during a crisis. Apart from dealing with the myriad of business challenges thrown at them by the coronavirus pandemic, they are trying to maintain morale of employees, many of whom are working remotely and coping with stresses of their own. This year American Banker asked executives at the 85 institutions that make up our ranking of the Best Banks to Work For to reveal how they have kept employees engaged and motivated in this most difficult of years. Included on this list are FNBC Bank, BankPlus, and United Bank. ... Read more
Last month, Bank of America announced that it had completed 10 new equity investments as part of its 4-year $1 billion commitment to advance racial equality in economic opportunity. Of BoA's 10 equity investments, 6 were to CDBA member banks: Carver State Bank, Carver Federal Savings Bank, First Independence Bank, M&F Bank, Southern Bancorp, and Optus Bank. These investments will facilitate benefits across multiple states and in the communities that these institutions serve through lending, housing, neighborhood revitalization, and other banking services.
A community development bank in Arkadelphia, Ark., that raised nearly $35 million could be a model for a growing number of similar banks scrounging for capital to meet the needs of consumers and small businesses in struggling neighborhoods. Central to the strategy of the $1.6 billion-asset Southern Bancorp is a heavy emphasis on returning capital to investors through regular dividends and a stock repurchase program. "There's patient capital, but patient shouldn't mean permanent," CEO Darrin Williams said in an interview after the bank recently published a paper about its successful capital... Read more
The proportion of U.S. households without access to a bank account fell in recent years but could be driven up again by the coronavirus pandemic, according to a survey released Monday by the Federal Deposit Insurance Corp. The so-called unbanked rate declined to 5.4% in 2019 from 6.5% in 2017, as some 1.5 million households saw at least one member open a checking or savings account, the FDIC said in the biennial report. That rate represents the lowest level since at least 2009, when the survey began. Most of the decline reflected improvement in the circumstances of households that didn’... Read more
Pressure is mounting on banks to offer low-cost accounts that could help bring more unbanked households into the financial mainstream. On October 19, both the American Bankers Association and the Federal Deposit Insurance Corp. called on banks that do not already offer accounts designed for previously unbanked consumers to start doing so. The basic accounts cost $10 or less per month and they usually do not come with paper checks, and don't charge fees for either overdrafts or low balances. JPMorgan Chase, Citigroup, Bank of America and Wells Fargo are among more than 40 banks that offer... Read more
The FDIC recognizes that MDIs play a unique role in promoting economic viability in minority and low- and moderate-income communities. Preserving, promoting, and building capacity in these institutions are high priorities for the FDIC. Because of this, the FDIC created "Investing in the Future of Mission-Driven Banks" as a way for private companies, philanthropic organizations, and others to learn more about the vital role of these financial institutions, and to provide suggestions about supporting MDIs and CDFI banks across the country through investments or partnership opportunities.
Hundreds of thousands of small businesses are closing for good. Temporary layoffs at larger companies are becoming permanent. But the country's largest banks, which together serve a majority of Americans through loans, credit cards or deposit services, are not raising an alarm. In their third-quarter earnings reports this week, big banks have said they are generally prepared for a wave of loan defaults they expect in the second half of next year. And their own fortunes are just fine: A trading and investment banking bonanza on Wall Street is helping them stay profitable. A few common... Read more
Treasury Secretary Steven Mnuchin said on Wednesday that he did not expect an economic relief package to be enacted before the Nov. 3 election, as he and Speaker Nancy Pelosi of California have continued to struggle to reach an agreement on a broad package to support the economy. Negotiators on Wednesday resumed discussions over a coronavirus relief package, even though Democrats and Republicans remain wildly divided over the scope and size of another stimulus bill. The Treasury secretary suggested that the gap on the top-line cost of the bill was not that wide, but that the... Read more
Amalgamated Bank yesterday announced that Keith Mestrich has informed the Board of Directors that he will step down from his positions as President and Chief Executive Officer on January 31, 2021. At that time, he will transition from a director to special advisor to the Board through July 2021. Mr. Mestrich joined Amalgamated Bank in 2012 and has served as its President and Chief Executive Officer since 2014. The Board has formed a Search Committee comprised of Lynne Fox, Chair of the Board, and four independent directors to oversee a national search process for a new CEO.
Kat Taylor started a bank, a venture capital firm and an agribusiness to use capitalism’s toolbox to fight systemic racism, environmental destruction and economic inequality. Way back in 2007 (the stone age in impact investing), Taylor and Steyer launched an idea they’d talked about for years: use a charitable foundation to start a bank that would lend to nonprofits and do-gooder businesses and direct its profits back to their environmental and community charitable causes. With Taylor as CEO, Beneficial State Bank has grown into a $1.1 billion institution with 13 branches stretching... Read more
Consumers on the prowl for higher rates on their savings or more places to spread out their cash have a few shortcuts. Now there’s a new competitor to these savings account rate finders: the German fintech Deposit Solutions. Through SaveBetter.com, an online portal that marks Deposit Solutions’ first foray into the U.S., consumers can shop offerings from a variety of banks. They can open one or more savings accounts from the available banks, with certificates of deposit expected to be available by the end of the year, but manage them all through a single SaveBetter account. “For Central... Read more
A two-track recovery is emerging from the country's pandemic-driven economiccontraction. Some workers, companies and regions show signs of coming out fine or evenstronger. The rest are mired in a deep decline with an uncertain path ahead. Just months ago, economists were predicting a V-shaped recovery—a rapid rebound froma steep fall—or a U-shaped path—a prolonged downturn before healing began. What has developed is more like a K. On the upper arm of the K are well-educated andwell-off people, businesses tied to the digital economy or supplying domestic necessities,and regions such as tech... Read more
The Economic Mobility Corps (EMC) is a joint initiative of the Community Development Financial Institutions Fund (CDFI Fund) and AmeriCorps that places full-time national service members in Certified Community Development Financial Institutions (CDFIs) to enhance their capacity to provide financial literacy, financial planning, budgeting, saving, and other financial counseling activities. Economic Mobility Corps members placed in Certified CDFIs will receive training on the principles of financial counseling and financial literacy and assist CDFIs in promoting access to capital and credit... Read more
The Senate on Wednesday passed a short-term funding bill just hours before the deadline to prevent a government shutdown. Senators voted 84 to 10 to keep the government funded at current levels through Dec. 11, setting up another funding fight after the November elections and right before the holidays. The funding bill, passed by the House earlier this month, now heads to President Trump's desk, where he is expected to sign it before midnight to keep the government running.
A new House Democratic economic stimulus plan would funnel billions of dollars to Community Development Financial Institutions, reauthorize the Paycheck Protection Program and allow marijuana banking. Those are just some of the provisions contained in the 2,153-page bill, which has formed the basis for renewed negotiations between House Speaker Nancy Pelosi (D-Calif.) and Treasury Secretary Steven Mnuchin. The Democratic bill also calls for $1 billion for CDFIs for financial support and technical assistance, and a $2 billion “emergency appropriation” for the institutions, as well as up to... Read more
While the typical bank may be able to promise your money will do well under its stewardship, few commercial options promise your money will do good, as well. That's where community development financial institutions (CDFIs) come in. A CDFI is a private financial institution whose primary mission is to help communities that are traditionally left out of banking and investing options. Banking customers who want to see their money help increase economic independence in underserved communities and help end the racial wealth gap can turn to a CDFI for their banking needs. Here's what you need... Read more
First Southwest Bank was awarded Community/Rural Lender of the Year by the Colorado Small Business Administration during their virtual conference for National Small Business Week. Sherry Waner, FSWB's Chief Development Officer, accepted the award on behalf of the bank. Examples of rural businesses across the state that FSWB has helped through SBA loans include GEOMAT, Phoenix Recycling, Espinoza Consulting Services, Agile Space Industries, Chinook Medical Gear and Ace Towing. During the ongoing small business impacts of COVID-19, First Southwest Bank has completed 805 Paycheck Protection... Read more
The federal government is cracking down on alleged fraud in the Paycheck Protection Program. The Justice Department recently filed nearly 60 charges involving what it says are attempts to bilk over $175 million out of the program. Meanwhile, legitimate borrowers are working to get their loans forgiven. Now the government’s dilemma is whether to make it easy to get a PPP loan forgiven. One idea is automatically forgiving loans under $150,000, a provision of the Paycheck Protection Small Business Forgiveness Act that’s been introduced to the Senate. Robert James II at Carver State Bank in... Read more
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... Read more