Recent News
The Board of Governors of the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), the Office of the Comptroller of the Currency (OCC), the Consumer Financial Protection Bureau (CFPB or Bureau), the Department of Housing and Urban Development (HUD), the Department of Justice (DOJ), and the Federal Housing Finance Agency (hereafter, the agencies) are issuing an interagency statement to remind creditors of the ability under the Equal Credit Opportunity Act (ECOA) and Regulation B to establish special purpose credit... Read more
It took more than a decade for Southern Bancorp Bank to double its tally of total assets from $1 billion to $2 billion. The top executive of the bank's parent company expects the journey to $4 billion will be much shorter. "With the amount of capital we're going to receive, we will double in size during the next three to five years," said Darrin Williams, CEO of Southern Bancorp Inc. A big catalyst for that future growth is a $237.5 million injection courtesy of the U.S. Treasury's Emergency Capital Investment Program. The money isn't in the bank but is expected to arrive in the second or... Read more
What does a zero carbon, climate-focused community bank look like? FinTech Futures spoke to Climate First Bank's founder, Ken LaRoe, and CTO, Marcio deOliveira, about the US entrant's ethos, technology, and plans, including its mixed views on fintechs. The climate crisis is only too apparent in Climate First Bank’s home state of Florida, with the threat of ever increasing storms and super-charged hurricanes, sea level rises, and record-breaking heat days, among other climate impacts. The bank claims to have been carbon neutral since day one, commits to never investing in extractive... Read more
LOCUS is seeking a Senior Analyst to join its growing Investment Advisory team. LOCUS is a national organization with staff in Colorado, Georgia, Nebraska, New York, North Carolina, Virginia, and Washington, D.C. This position is remote/home-office-based with limited travel related to team gatherings and/or client visits. LOCUS' Investment Advisory team provides services that enable its clients to make effective and efficient impact investments, including fund design & development, investment sourcing & evaluation, and portfolio management & servicing. This Senior Analyst will... Read more
Unions are rare in financial services, but there are exceptions, including Amalgamated Bank in New York, which was founded by a labor union in 1923. The $870 million-asset Bank of Labor in Kansas City, Kansas, was founded by a labor union in 1924 and has been affiliated with the United Mine Workers of America since August 2011. A more recent example is Beneficial State Bank in Oakland, California, where employees voted to form a union in March 2020 after CWA representatives approached the $1.5 billion-asset bank’s executives about the possibility of forming a labor organization for staff... Read more
Why minority professionals are often directed to community development jobs, rather than the more lucrative commercial real estate and private-equity fields. Community development has provided good-paying jobs to minority professionals at banks and nonprofits, such as CDFIs. But can it build broader breakout generational wealth, which is mostly possible at the developer level? And are there even enough people of color in those developer ranks to carry out the work? With access to capital such an impediment, large numbers of minority developers and entrepreneurs aren't lining up to rebuild... Read more
Banks that operate more like fintechs outcompete their more traditional competitors on certain financial products, researchers at the Federal Deposit Insurance Corp. found. The study used a new measure of technology adoption at banks to look at Paycheck Protection Program loan volumes in the second quarter of 2020. Banks in the top 15% for tech adoption made more loans than similarly sized competitors by 9 percentage points — and they gained customers outside their usual markets more often, the data showed. The findings prove the importance for community banks of adopting technologies... Read more
Can a social media site help stanch the flow of community banks selling themselves? Independent Bankers Association of Texas President and CEO Christopher Williston thinks his group's Bankers Helping Bankers service just might. The IBAT is pitching Bankers Helping Bankers, which matches banks with similar technology profiles, to other trade groups, primarily state associations like itself that are affiliated with the Independent Community Bankers of America. It aims to make Bankers Helping Bankers available to every community bank in the country. "We can unabashedly, unequivocally say we... Read more
Federal Deposit Insurance Corporation (FDIC) Acting Chairman Martin J. Gruenberg released last week the following statement and summary of the FDIC's priorities for the coming year: "The FDIC's core mission is to maintain stability and public confidence in the U.S. financial system. The FDIC carries out this mission through its responsibilities for deposit insurance, banking supervision, and the orderly resolution of failed banks, including systemically important financial institutions. Banking supervision encompasses safety and soundness and consumer protection, both of which are... Read more
The recent decision by Twin Cities-based Sunrise Banks to sell two of its former branch buildings to local nonprofits illustrates the commitment of the company and its CEO David Reiling. Sunrise Bank announced in December 2020 that it would close two branches — one on University Avenue and Vandalia Street, the other on the city's east side — and transfer customers to its University Avenue branches on Marion Street and Como Avenue. The $1.9 billion Sunrise also has a pair of offices across the Mississippi in Minneapolis. The bank worked closely with the nonprofit Creative Enterprise Zone on... Read more
Rohit Chopra, the director of the Consumer Financial Protection Bureau, raised hackles by launching a broad inquiry last week into so-called junk fees charged on run-of-the-mill financial products such as loans, mortgages and credit cards. "Service charges inflate ticket prices, resort fees hike our costs to stay in hotels, and our phone bills are often laden with mystery charges," Chopra said in a Jan. 26 press call. "These junk fees make it harder for us to choose the best product or service, since the true cost is hidden. Banking is no different." But this initiative has led bankers,... Read more
Darrin Williams, an attorney and former Arkansas state representative, wasn't interested when Southern Bancorp, Inc. approached him about a leadership position in 2013. His wife, however, reminded him of how rewarding he'd found it to facilitate a financial principles course at his church. Williams reconsidered and became CEO of Southern Bancorp, a group of three community development financial institutions (CDFI): Southern Bancorp Inc., the holding company; Southern Bancorp Bank, a $2 billion-asset community bank headquartered in Arkadelphia, Ark.; and Southern Bancorp Community Partners... Read more
Special purpose credit programs (SPCPs)—which allow banks to offer credit on favorable terms to borrowers who have suffered economic disadvantage and share common characteristics (e.g., race or income)—could provide the kind of homeownership boost to Black communities today that the New Deal provided to white people in the 20th century. We have previously shown how the effects of generations of systemic racism and economic exploitation make credit less accessible and more expensive to Black borrowers. These conditions drive the 30 percentage-point homeownership gap between Black and white... Read more
Arkadelphia, Ark.-based Southern Bancorp Inc., the holding company for Southern Bancorp Bank, agreed to acquire Marion, Ark.-based FCB Financial Services Inc. and subsidiary Premier Bank of Arkansas. The terms of the transaction were not disclosed. Southern Bancorp Bank has about $2 billion in assets, while Premier Bank of Arkansas has about $200 million in assets and three branches operating in Marion, West Memphis and Jonesboro, Ark., according to a news release. The acquisition is expected to close in the second quarter. With the deal, Southern Bancorp locations across Arkansas and... Read more
The Paycheck Protection Program (PPP) provided small businesses with roughly $800 billion dollars in uncollateralized, low-interest loans during the pandemic, almost all of which will be forgiven. With 93 percent of small businesses ultimately receiving one or more loans, the PPP nearly saturated its market in just two months. We estimate that the program cumulatively preserved between 2 and 3 million job-years of employment over 14 months at a cost of $170K to $257K per job-year retained. These estimates imply that only 23 to 34 percent of PPP dollars went directly to workers who would... Read more
Quontic Bank Holdings Corp., the parent company of Quontic Bank, announced today that it has appointed 10 members to a newly created Black and Hispanic Community Development Advisory Board. The advisory board will allow Quontic to formally engage experts involved in non-profit, financial literacy, and organizations supporting equitable access to affordable housing development and ownership to Black and Hispanic populations. This advisory board will work closely with Quontic's existing advisory board that advises on Quontic's geographic investment area, the greater New York City... Read more
A stretch of Frelinghuysen Avenue in Newark's South Ward will soon have a bank branch again. Industrial Bank is planning to open a location at 550 Frelinghuysen Avenue near Haynes and Meeker Avenues. The company submitted an application to the Federal Deposit Insurance Corporation in order to proceed with the proposal, according to a branch establishment notice. Industrial Bank is based in Washington, DC. and most of its locations can be found in the district or its Maryland suburbs. The company expanded to Newark just over two years after the Treasury Department’s Office of the... Read more
The Federal Reserve Board on Thursday released a discussion paper that examines the pros and cons of a potential U.S. central bank digital currency, or CBDC. It invites comment from the public and is the first step in a discussion of whether and how a CBDC could improve the safe and effective domestic payments system. The paper does not favor any policy outcome. "We look forward to engaging with the public, elected representatives, and a broad range of stakeholders as we examine the positives and negatives of a central bank digital currency in the United States," Federal Reserve Chair... Read more
The new Virginia Small Business Resiliency Fund program launched with more than $9.7 million in grants for 12 projects throughout the state, former Gov. Ralph Northam announced Jan. 13. The fund, developed by the Department of Housing and Community Development, expands access to capital and technical assistance for small businesses adversely or disproportionately affected by the COVID-19 pandemic, according to a news release. Additionally, the state is granting $1.5 million to Virginia Community Capital’s Economic Equity Fund Initiative to provide low-cost financing for 15 or more small-,... Read more
The Center for Disability-Inclusive Community Development (CDICD), managed by National Disability Institute (NDI), announced today the three winners and their partners of its Second Annual Inclusive Community Development Awards: True Link Financial and Sunrise Banks; Life Asset, a Community Development Financial Institution (CDFI); and Goodwill Industries of East Texas and Prosperity Bank. The purpose of the awards is to raise the visibility of financial institutions' and community-based organizations' activities that are promising and exemplary in support of low- and moderate-income (LMI... Read more