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This article examines the rising support for public banks that would work directly with community banks and credit unions. Funding infrastructure projects through public banks would bring down costs by reducing interest and debt service payments made toward private institutions.In New York City, for example, dozens of residents and community organizers in early June gathered in front of the New York Stock Exchange to launch the Public Bank NYC Coalition, a group calling for the creation of a New York City-owned bank. Oakland and San Francisco are exploring the idea. New Jersey and Michigan are also considering setting up state-owned banks. “I think this is the sign of the sleeping giant, the American populace, taking back their agency and accountability for the banking system,” said Kat Taylor, who co-founded Oakland-based Beneficial State Bank. “It belongs to all of us.”
Approval rates for small-business loan applications ticked up at both small and large banks in May. Banks with at least $10 billion of assets approved almost 26% of small-business loans last month, according to the Biz2Credit Small Business Lending Index. That is almost triple the rate in 2011 and up almost two percentage points from the approval rate a year earlier. The smaller institutions, with less than $10 billion of assets, approved 49.4% of applications, which was up from 48.8% a year ago.
The House Appropriations Committee has approved a FY19 Financial Services spending bill that would provide $216 million to the Community Development Financial Institutions program—a $25 million boost from the amount they proposed earlier this month. The Appropriations Committee approved the bill, 28-20. The $216 million is far short of the $250 million that the CDFI Fund received this year, but it exceeds the Trump Administration's request by some $202 million. The $25 million boost was proposed by Rep. Steven Palazzo (R-MS) who made it clear that this was the first step in ensuring funding for the program.
Virginia Community Capital received a $200,000 grant over a three-year period from the Thompson Charitable Foundation, as part of a $600,000 total grant package that will be directed at supporting businesses in Southwest Virginia. The grants from the Thompson Charitable Foundation will fund up to 12 small business workshops each year in Buchanan and Tazewell counties, provide free technical advisory services, and host four Small Business Challenges in each county that will award investment grants to existing and startup companies. These regions were deeply affected by coal and manufacturing industry losses.
City First Bank, Sunrise Banks, and Beneficial State Bank are among the Certified B Corporations named as "2018 Best for the World" global honorees. The award recognizes these organizations' positive impact on communities, the economy, their workers, and more. The full B Impact Assessment evaluates a company's environmental performance, employee relationships, diversity, involvement in the local community, and impact of a company's product or service. To become a Best for the World honoree, a company must score in the top 10 percent of Certified BCorps across the category areas of the assessment.
Business First Bancshares, Inc. has announced its planned acquisition of Richland State Bancorp, Inc. If the merger is successful, the subsequent combined institution would be the 4th largest Louisiana-headquartered bank, with total assets of approximately $2 billion. As per the agreement, Richland State's President and CEO, Jerome Vascocu, will join Business First's board of directors.
Virginia Community Capital has released its 2017 Impact Report, highlighting the last twelve months of its innovative lending portfolio. Last year, the bank surpassed a major milestone of creating $1 billion in project impact across the state. The report details VCC's impact to South Richmond's Jeff Davis Highway Corridor, focus on solar-energy investing, and innovative Virginia Fresh Food Loan Fund.
Bank of Montgomery was named 2017 Lender of the Year by USDA Rural Development State Director Dr. Carrie Castille. In 2017, Bank of Montgomery applied for and received four USDA Rural Development Business and Industry Loan Guarantees for a total of $39.25 million. They assisted these four businesses in creating and saving 289 jobs across Louisiana. Bank of Montgomery has assisted a total of 27 guaranteed loan borrowers totaling $156 million since it began participating in the Business and Industry Loan Guarantee Program.
The Urban Institute has released a state-by-state assessment of how successfully governors have targeted Opportunity Zones by need and benefit. The assessment, "Did States Maximize Their Opportunity Zone Selections?", is authored by community development expert Brett Theodos. Analysis shows minimal targeting of the program toward disinvested communities by a measure of investment flows developed by the researchers. Less than a third of the designated Opportunity Zones are in tracts with the lowest levels of investment, while 28% already attract high levels of investment.
Ashoka and BNY Mellon are hosting a Changemaker Challenge–a national social innovation competition–to uncover innovations that expand financial security of underserved communities, empowering everyone to be the drivers of their own financial wellbeing, resilience, and freedom. In a moment when six out of ten Americans will experience financial insecurity, families find themselves struggling to pay rent, afford healthcare, and cover their bills at the end of each month. Financial struggles leave entire communities without the opportunity and agency to plan for their futures and reach their goals. Times of joy—going to college, buying a home, raising children—have become sources of anxiety for too many. While saving money can be a challenge for a variety of reasons, the inability to build a strong financial foundation is often a symptom of a greater, systemic problem. Now, BNY Mellon and Ashoka are launching a collaborative effort aimed at addressing the root causes of financial inequality through innovation—the Unlocking Change Challenge.