City First Bank of D.C. and CEO Brian Argrett entered 2021 with lofty goals. The $394 million-asset bank is in the homestretch of completing a merger with Broadway Financial in Los Angeles that would create the nation’s biggest Black-led bank. The deal, scheduled to close in the first half of this year, comes at a time when more banks are focusing on addressing racial inequality. Argrett is one of American Banker’s five community bankers to watch this year.
Several consumer advocacy groups are opposing Oportun Financial's application for a national bank charter, citing concerns about the company's lending and debt-collection practices. Many of those issues came to light in a ProPublica investigation over the summer that focused on the high proportion of collection suits that the online lender had filed in recent years and its high proportion of repeat borrowers. Oportun charges high interest rates, rolls over too much debt and has been too quick to take borrowers to court when they fall behind on payments, the community groups wrote in comment letters to the Office of the Comptroller of the Currency. The company’s application also lacks a sufficient Community Reinvestment Act plan, several of the groups wrote.
The President is expected to sign the $900 billion COVID relief bill passed by Congress yesterday. Find here a 29 page summary on the most relevant aspects of the stimulus package.
The stimulus package being negotiated in Washington includes $285 billion for a renewed Paycheck Protection Program. The bill includes other aid measures that are not specifically part of the Paycheck Protection Program but could nonetheless help many small businesses. This includes $12 billion for Community Development Financial Institutions, which make loans and grants to people and communities that are often unable to get traditional banks to do business with them. That amount of money would be transformational, said Jeannine Jacokes, the chief executive of the Community Development Bankers Association, a trade group for community financial institutions. “Every time we have a recession, low-income places are hit the hardest and are the last to recover,” Ms. Jacokes said. “Treasury is providing the capital for a long-term investment in these communities.”
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.
The Consumer Financial Protection Bureau (Bureau) released a panel report as part of its rulemaking process under Dodd-Frank Act Section 1071 governing the collection and reporting of small business lending data. A panel was convened pursuant to the Small Business Regulatory Enforcement Fairness Act, comprised of representatives of the Bureau, the Office of Advocacy of the Small Business Administration, and the Office of Management and Budget. The panel consulted with representatives of small entities likely to be affected directly by a Section 1071 regulation, referred to as small entity representatives or SERs. These representatives included Cynthia Newell of City First Bank of DC and Jane Henderson of Virginia Community Capital.
Even as Covid-19 cases surge world-wide, the arrival of viable vaccines holds the promise of a return to something resembling normality by the middle of next year. But the commercial real-estate sector may never get back to normal, and that could spell trouble for banks. Many banks are concentrated in and dependent on commercial property lending. Bankshold half of all commercial real-estate loans. The 5,000 or so U.S. community banks, withabout a third of total assets, are two to three times as concentrated in commercial real-estate lending as the approximately 30 larger banks. Problems in commercial real estate can hurt banks in two ways. Losses on existing loanscan damage earnings directly, and a correction can reduce future lending volumes,impairing an important driver of earnings. Based on what we know now, things don’t look good.
A group of Black-owned banks will refinance a major construction loan for the Atlanta Hawks professional basketball team in a deal that organizers hope will spur more investment in Black-owned banks. Led by Carver State Bank in Savannah, Ga., the group of 11 banks will provide a $35 million syndicated loan to the Hawks for the refinancing of the Emory Sports Medicine Complex, the Hawks' three-year-old, 90,000-square-foot training and practice facility that also houses Emory Healthcare's sports medicine program and sports science and research division.
Darrin Williams, a former lawyer, rose from relative obscurity when he was tapped to be a member of President Trump's Great American Economic Revival initiative, which also included Jamie Dimon, chairman and chief executive officer of JPMorgan Chase & Co., and David Solomon, chairman and CEO of Goldman Sachs Group Inc. Their conversations with Trump and Secretary of the Treasury Steven Mnuchin ultimately led the Small Business Administration, which administered the $350 billion program, to earmark the money for so-called CDFIs. Southern Bancorp is one of the largest of about 1,100 such institutions, which the Clinton administration chartered to invest in the poorest U.S. communities. This summer, Williams’s bank wrote $111 million in PPP loans and gave away $125,000 to small businesses in the most Covid-devastated places in the Mississippi Delta.
On behalf of the Community Development Bankers Association (CDBA), we cordially invite you to the 2020 Virtual Peer Forum. CDBA's 2020 Virtual Peer Forum will take place during the afternoons of the first three weeks of December.
We pleased to announce the following Keynote Speakers: Jelena McWilliams, Chairman, Federal Deposit Insurance Corporation; Brian Brooks, Acting Comptroller of the Currency, Office of the Comptroller of the Currency; Jodie Harris, Director, Community Development Financial Institutions Fund, US Department of Treasury; Dane Smith, Managing Director, FSG
The CDBA Peer Forum is the "must-attend" annual event for the Community Development Banking sector. THE BEST PART: Registration is $500 for CDBA members and $600 for non-member banks. One registration fee allows an UNLIMITED number of attendees from your bank to attend ANY AND ALL sessions. Given the virtual format and savings on travel and accommodation costs, we hope to bring our robust programming to everyone at your bank who wants to participate. This offer extends to your bank’s Board Members, too.
While we cannot meet in person, CDBA is planning over 15 hours of programming, including keynote speakers, panels on current issues, and interactive sessions. Session themes include leading with a purpose-driven culture, the post-election political outlook, managing liquidity, strategies to promote diversity, equity & inclusion at your bank, product innovations, and much more.