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It's a far cry from the postal banking system that progressives favor and bankers dislike, but the U.S. Postal Service's entry into the check-cashing space is still making a big splash. Loud responses Monday from both boosters and critics reflected a widespread perception that the pilot program could be a first step toward a wider implementation of postal banking. The modest scope of the program contrasted with the size of the reaction it generated. The recently launched program is only operating in four offices — in Washington, D.C., Baltimore, Falls Church, Virginia and the Bronx, New York — out of the Postal Service's more than 30,000 locations nationwide. The USPS is only accepting business and payroll checks of $500 or less, shutting out larger checks and any personal checks. The post office will not provide cash in exchange for the checks, and will instead let customers purchase a single-use gift card of up to $500.
Financial giant JPMorgan Chase has increased its direct equity investments in Minority Depository Institutions and Community Development Financial Institutions to $100 million and has added 10 new institutions as recipients. JPMorgan Chase has announced investments in the following Black- and Latino- led MDIs and CDFIs: Arkadelphia, Arkansas-based Southern Bancorp; Savannah, Georgia-based Carver State Bank; Atlanta-based Citizens Trust Bank; Baltimore-based The Harbor Bank of Maryland; Detroit-based First Independence Bank; Columbia, South Carolina-based Optus Bank; McAllen, Texas-based Rio Bank; Houston-based Unity National Bank; Washington, D.C.-based Industrial Bank; and Miami-based Sunstate Bank. JPMorgan Chase’s latest round of direct equity investments more than doubles the $50 million it originally pledged to invest in MDIs and CDFIs. The bank's initial round of investments, which was dispersed earlier this year, included the holding companies for New Orleans-based Liberty Bank and Trust; Durham, North Carolina-based M&F Bank; New York City-based Carver Federal Savings Bank; and Los Angeles-based Broadway Federal Bank.
Five witnesses testified to the U.S. House Committee on Financial Services' Subcommittee on on Consumer Protection and Financial Institutions in a hearing entitled "The Future of Banking: How Consolidation, Nonbank Competition, and Technology are Reshaping the Banking System." Among the witnesses was Desiree Jackson, Assistant Vice President for Treasury Management at Beneficial State Bank. Click "read more" to read the committee memorandum and watch a recording of the hearing.
BancPlus Corporation, parent of Ridgeland, Mississippi-based BankPlus, said Wednesday that it is buying New Orleans-based First Trust Corporation, which owns First Bank and Trust. The terms of the deal were not disclosed but the banks said in a news release that First Trust Corporation shareholders will receive a combination of shares of BancPlus' common stock and cash. The takeover will have a total of 93 branches, combining BancPlus' 79 branches with First Bank and Trust's 14, across Louisiana, Mississippi, Alabama, and the Florida Panhandle. Assets will total $6.4 billion: $5.1 billion from BancPlus together with $1.3 billion from First Bank and Trust.
The release of 2020 Census population data provided much-anticipated insight into the demographic trends reshaping our nation, but it also unleashed a wave of predictable headlines touting the demise of "shrinking rural America." The familiar narrative of "two Americas"—one diverse, metropolitan, and successful and one white, rural, and declining—cropped up once more, often explicitly equating "rural" with "white" or, even more simplistically, with white Trump voters. While this narrative provides an easy way to think about America in binary terms, it obscures the far more complicated trends shaping rural America: most notably, its growing demographic diversity over the last decade. While it is true that the population of nonmetropolitan[1] America fell by about half a percentage point between 2010 and 2020, the future of rural America is increasingly marked by growing diversity and expanding inequity within and across regions—creating an intricate picture that binary thinking can't capture. Here, we present three demographic trends from the 2020 Census that upend outdated assumptions about nonmetropolitan America and conclude with a call to embrace a more inclusive future for increasingly diverse and dynamic rural towns and regions.
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 in distressed and underserved areas. A total of $1.9 million is available for awards to EMC recipients. Applications are due to AmeriCorps by 5:00 p.m. Eastern Time on Wednesday, January 5, 2022. Successful applicants will be notified by AmeriCorps by mid May 2022.
Amalgamated Financial in New York is acquiring Amalgamated Investments Co., the parent of Amalgamated Bank of Chicago, for $98.1 million in cash. While their names and missions are similar, the two companies are not affiliated. Both companies emphasize environmental, social and governance missions, serving nonprofit organizations and unions. Together, the companies said they would also serve political organizations and philanthropies that support environmental sustainability and social enterprises. "This acquisition aligns with our disciplined strategy of pursuing accretive opportunities that allow us to expand geographically, strengthen our financial resources and increase our customer base while leveraging our unique expertise in operating as an ESG-driven bank," Priscilla Sims Brown, Amalgamated Financial's president and CEO, said in a press release Wednesday.
Virginia Community Capital (VCC) has announced the hiring of Amir Kirkwood, formerly of Opportunity Finance Network (OFN), as its new president and CEO. In January, founding executive director Jane Henderson announced her plans to retire after four decades in the banking industry. 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 economically excluded communities. The organization has driven $1.8 billion in total impact in the Commonwealth since its launch in 2006. This includes nearly 12,000 jobs created or retained and over 10,000 affordable housing units financed. In addition, VCC subsidiary LOCUS Impact Investing has worked with mission-driven philanthropic organizations across the nation to unlock $57.8 million in funds committed to communities since 2017.
Today, the FDIC released new information about the Mission-Driven Bank Fund.The goal of the Fund is to provide private investors (corporations, financial institutions and philanthropic organizations) with an opportunity to support CDFI and MDI banks. These mission-driven banks will be invited to make pitches to the Fund for potential investments in a wide variety of asset classes including equity, loan participations, loss share agreements, CDs, term debt, and advisory services. The Fund currently has commitments of $120 million and growing. The anchor investors, Microsoft and Truist, are getting ready to issue a solicitation for the Fund Manager in the coming weeks, and more investors are expected to join on. The goal is to onboard the Fund Manager in the 4th quarter, so that FDIC-insured CDFIs and MDIs can submit individual pitches in the 1st quarter of 2022. Questions regarding this program should be directed to MissionDrivenFund@fdic.gov.
Banks and credit unions oppose federal proposals to let the Small Business Administration make some 7(a) loans directly in addition to its traditional role of guaranteeing credits extended by private lenders. The Biden administration's $3.5 trillion spending package would give the SBA nearly $4.5 billion to make 7(a) loans of $150,000 or less directly to borrowers. The cap for direct loans to manufacturers would be $1 million. Legislation approved by the House Small Business Committee last week included an option for the SBA to originate small 7(a) loans "through partnerships with third parties" — which presumably could include some banks and credit unions. At the same time, the bill would authorize SBA "to originate and disburse direct loans." With details still in short supply, Ian McKendry, a spokesman for the American Bankers Association, said in a statement that his group "want[s] to better understand why it makes sense to create a direct lending program to compete with banks that are already meeting demand for 7(a) loans." “It could have the unintended effect of making it more difficult for some lenders to continue participation in the 7(a) program,” McKendry said.