African American Resources
"If we remain poor and dependent, the riches of other men will not avail us. If we are ignorant, the intelligence of other men will do but little for us. If we are foolish, the wisdom of other men will not guide us. If we are wasteful of time and money, the economy of other men will only make our destitution the more disgraceful and hurtful. "
A THOUGHT: AFRICAN-AMERICAN BANKS AND MOVING YOUR MONEY
Anyone who has been reading this blog for awhile knows that my biggest problem with Obama administration and the Federal Reserve was the Wall Street bailout which was pretty much limited to helping the major money center banks and firms like AIG. Many of these institutions were at the center of the financial crisis we encountered. The unpopular policies pursued by our government resulted in the taxpayer being put on the hook for poor management decisions made by many of these institutions. Moreover, the policies pursued by the Federal Reserve have allowed certain institutions to become extremely profitable which ultimately reinforces the “too big to fail” policy and the related moral hazard policy it has pursued since the Greenspan era. This is akin to allowing these institutions to effectively hold a sword of Damocles over the financial economy as they’ll be at the government trough again without the discipline of market forces and sensible regulation.
This has spawned a movement as a sort of protest against this and the idea is for people to move their money out of these major money center banks as a way to counter their power. Essentially, the idea is smaller depositors moving their deposits en masse to smaller community based banks thereby nullifying the policies while at the same time increasing the deposit base of community based institutions that are more inclined to lend. I think that’s a good idea and it’s something that’s fairly simple to do.
As I was reading about this movement, I thought of African-American owned banks and how a similar movement might not only help these institutions, but the African-American community at large. After doing some research, I found that a popular African-American talk show host had made a similar call late last year as a way of economically empowering the African-American community. Here’s a list ofAfrican-American owned banks that was compiled for this purpose. I went through this list to check some of the banks’ ratings at www.bankrate.com, which assigns a rating from one to five stars, with five being the highest rating, based on asset quality, solvency and profitability measures. Of the eight banks I checked, one had four stars (Liberty Bank & Trust of New Orleans), three had three stars and the rest were rated below three stars. The banks with the low ratings generally had issues with adequate capital, which is tied directly to profitability and the quality of loans on the books.
During the past year, a group of African-Americans tried to raise $ 50 million to create a black owned holding company that would invest in black banks in a bid to shore up their capital, but their efforts appear to have been strictly limited to attempting to get a piece of the treasury’s TARP program rather than to raise the money the traditional way from the public securities markets. Of course, their claim was that these markets aren’t receptive to black banks, which is probably true given that only one black bank’s stock is publicly traded. That means that most of these institutions don’t have access to vast pools of capital.
Given that most black banks can’t access public markets for capital, it just seems to me that they could be greatly helped if their depositor base were expanded. We don’t need government assistance to do that, all people need to do is make a decision where they will house their money. Of course, housing your money at a black bank doesn’t do much to spur economic development in the community unless there’s a commitment to lend money. Lending money for a bank has to be a profitable proposition, which means that the conditions that chase investment capital away from the black community now (i.e. high crime, lack of skilled workers and etc.) have to also be resolved. Those conditions make lending and opening a business in these areas a risky proposition and this is the greatest impediment to economic development. None of this will be solved overnight, but I suppose moving one’s money, where practical, is a start towards a building effort.
What is really needed to make such a move effective is a strategic plan for the development of the African-American community that is based wholly on what we can do for ourselves absent government assistance and the strings that come along with it. There are plenty of plans around things like increased diversity which, while helping select individuals, actually does very little to address the community’s ills. There are plenty of plans where continued petitions are made to the government to address our problems, but there is nothing that I’m aware of that would represent a plan based wholly on decisions we can make or things we can do to address the problems ourselves. Such a plan is sorely needed, not to mention the execution thereon. Absent that, we’re all reduced to calling for this or that absent the knowledge of why or where the initiative leads strategically.
Black Owned Banks
Carver Bancorp, Inc.
Deborah Wright, President & CEO
75 West 125th Street
New York, NY 10027
(212)876-4747 | FAX (212)426-6214
Independence Federal Savings Bank
Donna Shuler, President & CEO
1229 Connecticut Avenue, NW
Washington, D.C. 20036
(202)628-5500 | FAX (202)626-7106
Industrial Bank, N.A.
Doyle Mitchell, President & CEO
4812 Georgia Avenue, NW
Washington, DC 20011
(202)722-2000 | FAX (202)722-2040
Highland Community Bank
George Bar, CEO
1701 W. 87th Street
Chicago, IL 60620
(773)881-6800 | FAX (773)881-7567
Seaway National Bank of Chicago
Walter E Grady, President & CEO
645 East 87th Street
Chicago, IL 60619
(773)487-4800 | FAX (773)487-0452
Citizens Trust Bank of Atlanta
James E Young, President & CEO
75 Piedmont Avenue
Atlanta, GA 30303
(404)653-2800 | FAX (404)584-7766
Family Savings Bank, FSB
Wayne-Kent A Bradshaw, President & CEO
3683 Crenshaw Blvd.
Los Angeles, CA 90016
(213)295-3381 | FAX (213)296-6801
Liberty Bank and Trust Company
Alden J McDonald, CEO
P.O. Box 60131
New Orleans, LA 70160
(504)286-8861 | FAX (504)286-8866
City National Bank of New Jersey
Louis E Prezeau, CEO
900 Broad Street
Newark, NJ 07102
(973)624-0865 | FAX (973)624-4369
The Harbor Bank of Maryland
Joseph Haskins, CEO
25 West Fayette Street
Baltimore, MD 21201
(410)528-1800 | FAX (410)528-1420
Mechanics and Farmers Bank
Lee Johnson, Jr, Chairman, President & CEO
116 West Parrish Street
Durham, NC 27701
(919)683-1521 | FAX (919)687-7821
Broadway Federal Bank
Paul C Hudson, President & CEO
4835 W. Venice Blvd.
Los Angeles, CA 90019
(213)931-1886 | FAX (213)931-2272
Consolidated Bank and Trust Company
Vernard W Henley, Chairman
320 North First Street
Richmond, VA 23219
(804)771-5200 | FAX (804)771-5269
Illinois Service Federal S&L Association
Thelma J Smith, President & CEO
4619 South King Drive
Chicago, IL 60653
(773)624-2000 | FAX (773)624-5340
United Bank of Philadelphia
Emma Chappell, Chairman, President & CEO
714 Market Street
Philadelphia, PA 19106
(215)829-2265 | FAX (215)829-2269
Founders National Bank of Los Angeles
John Kelly, President & CEO
3910 W. MLK, Jr. Blvd.
Los Angeles, CA 90008
(213)290-4848 | FAX (213)290-3313
First Independence National Bank
Donald Davis, Chairman
44 Michigan Avenue
Detroit, MI 48226
(313)256-8400 | FAX (313)256-8811
Tri State Bank of Memphis
Jesse H Turner, Chairman & President
180 South Main at Beale
Memphis, TN 38103
(901)525-0384 | FAX (901)526-8608
Citizens Federal Savings Bank
Bunny Stokes, CEO
1700 3rd Avenue North
Birmingham, AL 35203
(205)328-2041 | FAX (205)214-3070
Dryades Savings Bank, FSB
Virgil Robinson, President & CEO
231 Carondelet Street Suite 200
New Orleans, LA 70130
(504)581-5891 | FAX (504)598-7233
Boston Bank of Commerce
Kevin Cohee, Chairman & CEO
133 Federal Street
Boston, MA 02110
(617)457-4418 | FAX (617)457-4430
Douglass National Bank
Ronald Wiley, President & CEO
1670 E. 63rd Street
Kansas City, MO 64110
(913)321-7200 | FAX (913)321-7519
Mutual Community Savings Bank Inc., SSB
William G. Smith, President & CEO
315 E. Chapel Hill Street
Durham, NC 27701
(919)688-1308 | FAX (919)682-1380
First Tuskegee Bank
James W Wright, Chairman & CEO
301 North Elm Street
Tuskegee, AL 36083
(334)262-0800 | FAX (334)265-4333
Capitol City Bancshares Inc
George Andrews, President
562 Lee Street S.W.
Atlanta, GA 30310
(404) 752-6067 | FAX (404)752-5862
Consolidated Bank & Trust Company
V. W. Henley, Chairman & CEO
320 North First Street P.O. Box 26823
Richmond, VA 23261-6823
(804)771-5200 | FAX (804)771-5244
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