Community Development Banking News
CDFI Banking: Industry, Policy, and Beyond.
The Consumer Financial Protection Bureau (CFPB) recently announced the appointment of new consumer experts from outside the federal government to the Consumer Advisory Board, Community Bank Advisory Council, Credit Union Advisory Council, and Academic Research Council; the four bodies will provide advice to CFPB leadership on a broad range of consumer financial issues. Among the new appointees to the Community Bank Advisory Council is Max Yates, Senior Executive Vice President and Chief Risk Officer of BankPlus in Ridgeland, Mississippi. Yates is a member of the CDBA Board of Directors.
A recent survey of 219 US banks conducted by the American Bankers Association found that 87% do not have a formal payments strategy. 70% do not analyze payments data to gain insights into customer behavior. New payment technologies such as digital currencies, person-to-person payment apps, real-time payments, and mobile wallets threaten to erode the indispensable role that small banks have long played in their customers’ lives. There are certain steps that small banks should take to better position themselves for the payments revolution.
Vernon, Alabama is just a dozen miles from Caledonia, Mississippi, but the Bank of Vernon took 11 years to cover that distance. On June 28th, representatives and officials gathered at the ceremonial opening of the bank’s new branch in Caledonia’s primary retail area. The tiny town of 1,100 residents has been without a bank branch for 15 years, but it is growing steadily. “We’ve got some great plans for the area, and we appreciate the support of the people of Caledonia,” said Bank of Vernon CEO Andy Johnson.
The Federal Reserve just published its 2016 Small Business Credit Survey examining current small business conditions and credit environment. Forbes reports on the results: although big banks are still the major lenders, small business owners are having trouble accessing credit. Owners are constantly exposing themselves to risk because they cannot find adequate financing options. While many are turning to online lenders, SBA loans are a largely underutilized resource.
A report quietly released by the Treasury Department supports the perforamnce of the Bank Enterprise Award (BEA) program, saying there is "clear evidence" it helps recipients provide financial services to the must underserved communities.
In June, the Greater Minnesota Housing Fund announced the identities of 7 public and private investors that have raised over $25 million to acquire and preserve 1,000 unsubsidized, affordable rental units in the Twin Cities. The fund comes at a critical time for the region, which has recently lost thousands of once-affordable rentals. Sunrise Banks was a major investor in the new initiative.
Thanks to an $84,000 Affordable Housing Program (AHP) grant from Community Bancshares and the Federal Home Loan Bank of Dallas (FHLB Dallas), 12 low-income families in George and Greene counties in Mississippi will receive significant upgrades to their homes, most of which lack basic air conditioning. The George/Greene Habitat for Humanity (HFH) will spearhead the renovations. “We are a rural Mississippi affiliate with no major industry in our network,” said George/Greene HFH Executive Director Sue Trosclair. “We have to raise our own funds, so this grant is very important to us.”
This Social Impact report recently released by Sunrise Banks is an exemplary illustration of how to use data to demonstrate a measurable commitment to community economic development.
The Center for Financial Services Innovation (CFSI) was featured prominently in JP Morgan CEO's annual shareholder letter over their cutting edge FinTech Incubator, Financial Solutions Lab. So far they have supported 18 companies that have gone on to collectively raise $100 million in follow-on-capital, including Propel, which simplifies the process of getting food stamps, and Remedy, whose software aims to help consumers avoid overpaying on their medical bills.
A new report entitled Looking for Progress in America's Smaller Legacy Cities documents study visits to Chattanooga, Tennessee; Cedar Rapids, Iowa; Rochester, New York; and Grand Rapids, Michigan - all cities that have experienced some revitalization since the sharp national decline in economic activity during the late 2000s. The aim of the report is to help guide representatives of organizations that fund projects in specific geographic areas - often referred to as "place based funders." These funders can play an important role in helping residents of growing cities access broader economic opportunity.