Recent News
Antonio Weiss, a senior investment banker at financial advisory and asset management firm Lazard, has withdrawn his name from consideration as under secretary of the Treasury for domestic finance in the face of staunch liberal opposition. Weiss will instead serve as a counselor to Secretary of the Treasury Jacob Lew. Weiss' nomination ran into a wall of congressional resistance led by Sen. Elizabeth Warren (D- Mass.), who opposed the nomination of a Wall Street executive to a post that oversees Dodd-Frank regulations. Lazard’s work helping Burger King acquire the Canadian chain Tim Hortons... Read more
Lending initiatives run by faith-based organizations are shifting the way churches approach charity and creating a new alternative to payday lenders and pawn shops. The programs offer parishioners who have fallen deep into debt with payday lenders a low-interest path to repayment. The Virginia United Methodist Church's Jubilee Assistance Fund offers collateral so borrowers can qualify for a loan through the Virginia United Methodist Credit Union. Loans offered through the program have annualized interest rates as low as 6 percent. The program is still quite small -- just 14 loans from $... Read more
President Barack Obama has announced his intent to nominate City First Bank of D.C. President and CEO Brian Argrett to the Administration’s Community Development Advisory Board. Argrett currently serves as the Vice Chairman of the CDBA. He also served as President, CEO and Director of small business investment company Fulcrum Venture Capital Corporation. Previously, Argrett served as Chairman of FirstFed Financial Corp. “These fine public servants bring a depth of experience and tremendous dedication to their important roles,” Obama said. “I look forward to working with... Read more
Richard Shelby (R-Ala.) has been named chairman of the Senate Committee on Banking, Housing and Urban Affairs for the 114th Congress. Shelby previously served as the chairman of the Banking Committee from 2003 until 2006. Shelby is likely to make rolling back provisions of the Dodd-Frank Act a core objective for his committee. He has also spoken in favor of altering the structure of the CFPB and decreasing the power held by its director. But Shelby has also shown a populist streak that could work against big banks. He has in the past leveled criticism against Wall Street firms for their... Read more
Urban Partnership Bank is launching two new services intended to offer a lower priced alternative to currency exchanges and other alternative financial services. The first is a new check cashing service designed as a convenient way to cash a check and get money instantly. No bank account is needed to qualify. The second is a prepaid card that functions like a bank account without checks, allowing customers to load funds on the card at any Urban Partnership Bank location or ATM through direct deposit or at select retailers. “Too many people are still without traditional... Read more
Sen. Sherrod Brown (D-Ohio) has proposed an alternative to payday loans that would allow low-income workers to claim part of their Earned Income Tax Credits (EITC) early when they need a cash boost, rather than waiting to claim the entire credit at tax time. The EITC is a tax credit that forgives some federal and payroll taxes for low-wage workers who otherwise would fall into poverty. Brown's proposal caps the amount which may be claimed early; maximum claims will range between $133 and $500 based on number of dependents. The cap is designed to find middle ground between providing enough... Read more
President Obama has announced he will nominate community banker Allan Landon to serve on the Fed Board of Governors. Landon’s community banking experience sets him apart from other members of the Federal Reserve -- economists, policymakers and bankers who built their careers at larger firms. Landon began his community banking career as CFO of Tennessee-based First American in 1998. In 2000, Landon was hired by the Bank of Hawaii Corporation as a chief risk officer and went on to become CEO. Most recently, Landon has worked with the $50 million Community BanCapital fund, which aimed to... Read more
Sunrise Banks has become one of the first Public Benefit Corporations in Minnesota. The state recently passed legislation offering the new classification, which allows corporations to elect to pursue social and environmental goals alongside shareholder profits. Although Sunrise had already received B Corp certification from B Lab, the new legislation provides legal accommodation for the status. “Our organization is full of people who are passionate about giving back and creating positive change,” says Sunrise CEO David Reiling. “Across the bank our people want to be a part... Read more
David Reiling, CEO of St. Paul, Minn. based Sunrise Banks has been named one of Trust Across America’s Top 100 Thought Leaders for 2015. The award recognizes leaders who are transforming the way organizations do business. "Trust is at the cornerstone of Sunrise Banks’ culture and in the DNA of all levels of the organization,” Reiling said. “With trust, employees are allowed to 'punch above their weight' and think outside the parameters, setting the... Read more
CDBA Member Carver Federal Savings Bank seeks a Chief Credit Officer to monitor and manage credit risk within the bank and its lending activities, including evaluating credit processes and actively participating in approval and risk management processes. This position reviews credits prior to submission to management loan committee and provides feedback to lenders.
New York City's Spring Bank is putting new innovations in behavioral economics into practice to help low-income customers improve their finances. Recent scholarship in the field focuses on how incentives can be structured to "nudge" people toward good decisions. Spring Bank's Borrow-and-Save loan puts that concept into practice. It encourages savings by requiring borrowers to put 25% of the loan amount into a savings account that can only be accessed at the end of the loan term. A customer who borrows $500 would receive $375. The other $125 would be set aside as savings. "... Read more
When Ridgeland, Miss.-based BankPlus started offering its Credit Plus product as a safe alternative to payday loans, CEO Bill Ray expected most of the business would be from financially precarious low-income borrowers. But Ray was surprised to find that many customers were not low-income -- rather, they were middle-income borrowers who had fallen on hard times and "never had any financial literacy training and got caught up in the payday lending habit." The product offers low-interest loans up to $1,000 for consumers who agree to open accounts at the bank and enroll in a... Read more
The CDFI Fund is soliciting public comment on the Bank Enterprise Award Program Application. The CDFI fund has asked for specific comment on the practical utility of data being collected in the application and how they can enhance the quality of that information. The Fund also seeks input on the burden of assembling the data and suggestions for easing the burden, including through technology. In addition, the Fund has requested estimates of costs of operation required to provide the requested information. All comments must be submitted by February 23, 2015.
Virginia Community Capital President and CEO and CDBA Chairman Jane Henderson has been appointed to Virginia Governor Terry McAuliffe's Commonwealth Council on Bridging the Nutritional Divide. The council aims to eliminate childhood hunger with nutritional assistance programs, increase access to healthy local foods, and facilitate local healthy-living initiatives. Virginia Community Capital is doing its part with a loan to Seven Hills Food, which plans to open a meat processing facility in Lynchburg. The plant is expected to create a new market for local farmers while... Read more
Southern Bancorp of Arkadelphia, Ark. is buying Bank of Bolivar County, a small $15.9 million-asset Mississippi Delta bank. Bank of Bolivar County has two locations: one full-service office and one limited service branch. These will build on Southern Bancorp Bank's presence in Bolivar County, where it currently operates one branch. The acquisition marks a step forward for Southern Bancorp's efforts to increase the availability of capital to Mississippi residents; the bank is also in the process of adding its third branch in Hot Springs, Miss.
The modifications to Dodd-Frank included in the recent omnibus bill marks what could be the first in a series of attempts to modify the regulatory legislation. With Republican majorities taking hold in the House and Senate and some Democrats showing willingness to compromise on the legislation, Wall Street advocates see an opportunity to secure less restrictive regulations. Among the likely flashpoints is a proposal to restructure the CFPB by allowing Congress to set its budget and setting agency policy with a bipartisan commission rather than a single director. Regulatory relief is also a... Read more
The Senate has adjourned for the year without acting on a bill that would require one of the seven members of the Fed’s board of governors to be a community banker. The Senate had initially approved the measure, inserted into a bill passed by the House that extended the federal terrorism insurance program. But the Senate was unable to pass the final bill before adjourning. Sen. David Vitter (R., La.) proposed the legislation, saying a person with small-bank experience would act as a balance to board members from academic backgrounds. He plans to resurrect the proposal as a standalone bill... Read more
Urban Partnership Bank has announced it is now a certified CDFI in Detroit and Wayne County, Michigan, affirming the bank's commitment to the Detroit area. The bank was also recertified in Chicago, Cook County and Illinois. In addition, the bank has announced that their board of directors is now a 12-member team with the addition of Michael Lewis. Lewis served as regional president and executive vice president of the Chicago Metro Region of BMO Harris Bank until his retirement in 2013. “The CDFI designations and the addition of Mike Lewis to our board further underscore... Read more
OneUnited Bank will be providing a $10,000 gift to jump start the Employ Miami-Dade initiative. The goal of the initiative is to centralize resources for locals to get workplace readiness training and jobs. Employ Miami-Dade will first target the construction industry, helping local workers get hired by the construction firms which are tackling the county's current building boom. Trainees who qualify will receive a bi-weekly stipend of $250, initially funded by OneUnited's $10,000 gift. OneUnited's commitment to the initiative will extend long-term; the bank will provide... Read more
A new report examines the relationship between rapid growth of nonperforming loan servicing costs and tight mortgage credit standards. In 2013, the annual cost of servicing a nonperforming loan was 15 times that of servicing a performing loan—$2,357 versus $156. In addition, the cost of servicing nonperforming loans has risen almost twice as fast as performing loans -- from $482 in 2008 to $2,357 in 2013, a 489 percent increase. As a result, servicers charge riskier borrowers higher, sometimes unaffordable, rates. The report cites Fannie and Freddie's compensatory fees charged on tardy... Read more