Black owned banks Archives

Published on August 29, 2022

4 mins read

Can Black-Owned Banks Benefit From Fintech layoffs?

Over the past few years, Black-owned banks have had some difficulty attracting IT professionals. And a national labor shortage, a pandemic, and the “great resignation” have not made this issue any easier to resolve.

Over the past few months, a slowdown in venture capital funding into the fintech sector has led to a wave of layoffs as a result of high interest rates, rising inflation, and falling stock market valuations.

Coinbase announced in June that it was laying off 18% of its workforce. Robinhood cut 9% of its workforce in April, followed by a 23% reduction in August. PayPal’s security R&D team, which was focusing on emerging technologies, was also laid off.

The fintech sector’s funding woes could possibly be the answer to the tech talent shortage at Black-owned banks. The opportunity presents itself at a pivotal time as the banking sector accelerates its transition to modern technology across the board, from artificial intelligence software to core computing in the cloud.

Black-owned banks now have an opportunity to hire innovative candidates that possess a combination of tech, customer experience, and finance skills.

But first, banks should ensure they have the systems in place to hire as quickly as possible.

Solutions include video interviews or implementing an interview and evaluation structure that allows multiple stakeholders to speak with applicants over the course of a single day. These “marathon interviews” can be demanding but will accelerate the hiring process.

A particular focus should be placed on hiring those who specialize in artificial intelligence, machine learning, and data science. Banks have lagged behind when it comes to personalizing financial services and products. Meanwhile, fintech’s have done a great job of understanding client concerns.

As more fintech talent becomes available, banks should also consider what customer experience experts with fintech experience can bring to the table.

This would be an opportunity to hire those who have a thorough understanding of millennial and Gen Z customers and know how to cater to their needs.

These experts specialize in paying attention to consumer behavior and pain points while collaborating with technology teams to create personalized solutions.

Another reason that banks have struggled to attract tech talent is that their traditional cultures do not align with that of tech workers.

Traditional financial institutions should explore key motivators which would make their culture appealing to those who have developed skills in the fintech industry.

Flexible scheduling and the option to work from home are benefits that will help lure fintech talent. Talented millennial employees have realized the benefits of working when they are most effective as individuals, as opposed to the typical 9–5.

However, although fintechs’ cool culture and excitement gave them an advantage in recruiting, in uncertain economic times, workers with families may find greater security in traditional banks.

All of that being said, recruiting is only half the battle. As the skills gap continues, banks will also need to prioritize employee retention. Investing more in emerging technology and updating legacy systems will help retain these tech savvy professionals.

Tony O. Lawson

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Published on September 9, 2021

2 mins read

Black Owned Bank From Detroit to open a location in Minneapolis

First Independence is a Detroit-based, Black owned bank and one of only 18 Black owned full-service banks in the U.S. In late August, it filed an application with the Federal Deposit Insurance Corporation to open a branch in Minneapolis.

The “full service” bank is expected to open a branch in early November. Another location may open by the middle of 2022, First Independence Bank chairman and CEO Kenneth Kelly said at a news conference.

“Banks are beacons of hope in their communities, and we intend to be that for the people of Minneapolis, St. Paul and the rest of the Twin Cities, particularly those who are unbanked or underbanked throughout the region,” Kelly said.

Related: Black Owned Banks Still Operating in 2021

Its arrival is supported by five banks in the Twin Cities — Bank of America, Bremer Bank, Huntington Bank, U.S. Bank and Wells Fargo, who will assist with capital, research, marketing and other services.

The incoming university location was formerly a Wells Fargo bank. In March 2020, Wells Fargo made a $50 million investment in 13 Black-Owned Banks, including First Independence. Bank of America also invested in September 2020, taking equity stakes of about 5% in First Independence Bank.

The bank hopes to lessen racial disparities with a home loan program intended to reduce the gaps between Black and white homeowners and a loan program to help establish a credit score or repair personal credit, Kelly said. As a Community Development Financial Institution, the bank will have more favorable lending rates to individuals in low-income areas.

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Published on April 10, 2018April 10, 2018

7 mins read

The only Black Owned Bank in Texas Opens Atlanta branch

Unity National Bank, the only Black owned bank in Texas, has opened its first out-of-state branch in Atlanta. This is happening in a time when the number of Black owned banks in the U.S. is on decline.

The expansion caps recent years of financial growth at Houston-based Unity, driven in part by the bank’s continued commitment to its Third Ward neighbors, and recent social justice movements. Unity is the only Black owned bank in Texas.

black owned bank

In September 2017, the bank reported assets of more than $98 million, up from $84 million in the same period a year earlier. Between 2015 and 2017, it reported an 18.4 percent increase in assets making it one of the top-performing Black owned banks in the U.S., according to a report from the Federal Deposit Insurance Corp.

Unity’s financial success is an outlier, said William Michael Cunningham, D.C.-based economist and banking expert.

In 1994, there were 55 African-American-owned banks in the U.S. By 2010, that number dwindled to 34. Today, it’s less than 30.

Unity also was able to avoid taking up any government bailouts after its board members and shareholders invested their own capital into keeping the bank open. They weren’t willing to let go of its historic and symbolic significance, Brooks added.

Banks like Unity popped up across the nation during the 1960s civil rights movement. African-American small business owners, denied financing at white-owned banking institutions, opened their own banks within their neighborhoods. They served as a means to build their own capital, and as a symbol of black economic power.

Unity was originally founded in 1963 as Riverside National Bank, led by local doctors and lawyers.

Cunningham said that often these founders had no plan of succession, leading to bank closures by the next generation.

In 1985, the bank’s name changed to Unity National Bank. Four years later, Unity was acquired by a new set of minority leaders who continued the bank’s legacy of serving lower-income residents in Houston’s Third Ward, going to so far as to offer financial literacy services to customers denied loans at other banks. Workers at Unity continued to sit down with customers, walking them through why they were denied and helping them brainstorm ways to improve their financial standing to qualify.

For all its efforts, Unity was losing higher-earning clients to larger banks such as Wells Fargo that offered more resources.

By 1998, Unity opened its first branch in Missouri City where it attracted black customers from a higher income bracket, as well as a greater variety of customers including Latinos and Asians.

Brooks noted that as Unity continued to serve its community, this time as a regional bank, there was some question over whether the community appreciated Unity’s services and history.

In 2016, the bank got its answer.

Following the police shootings of black men across the country in 2016, including Alton Sterling in Louisiana and Philando Castile in Minnesota, rapper Killer Mike offered an alternative to protests. At an MTV and BET town hall meeting, as an extension of the Black Lives Matter movement, he called for 1 million African-Americans to deposit $100 in black-owned banks. It would be a means to heal by strengthening the community’s power, specifically its economic power.

The movement #BankBlack took off. Unity was taken by surprise.

More than 350 people opened new accounts at Unity days after Mike’s announcement. They waited in line for hours, some traveling from out-of-state where their black-owned banks had closed.

Across the nation, Mike’s million goal was met and banks like Unity experienced a revival that some academics, including Cunningham, cite as potential for these banks to grow in size rather than shrink as projected

“In history, movements pop-up that change the trajectory of a given industry,” Cunningham said.

Sherifat Lawal, assistant vice president of lending at Unity, said that the push from #BankBlack is still being felt today with residents from across Texas and out-of-state asking for new branches to open.

The expansion into Atlanta this year, Lawal added, was in part driven by the public support in 2016.

Kase Lawal, local billionaire and chairman of Unity, had been interested in having Unity enter the Atlanta market since 2007 because it’s the so-called “mecca” of black business. Opportunity opened up in 2017 after one of Atlanta’s prominent Black owned banks closed, leaving a void Unity could fill.

Billionaire Kase Lawal and wife Eileen Lawal

More than 500 guests attended the grand opening ceremony on March 26 at the corner of Peachtree Street and M.L.K. Jr. Drive, including U.S. Rep. John Lewis, D-Ga., and Atlanta’s Mayor Keisha Lance Bottoms.

“By providing opportunities to achieve financial success, businesses like Unity National Bank help build equity into the fabric of our community,” Bottoms said in a statement. “Having a bank that understands the needs of the unbanked and that specializes in serving Black entrepreneurs is an essential part of my administration’s goal to build one Atlanta.”

Back at the Houston branch, a sign announcing the Atlanta expansion greets clients.

“They’re excited about their bank going to Atlanta,” Brooks said. “Everyone wants pride of ownership, and our customers own the bank with us.”

Unity continues to be a supporter of Black people in the Houston region, including members of the Greater Houston Black Chamber of Commerce.

To further tap into the renewed public interest in Black owned banks, Unity is set to launch a full online banking service by year-end so residents from across Texas and the U.S. can open accounts electronically.

Source: The Chron

Published on August 8, 2016June 2, 2020

3 mins read

6 Black Owned Banks in the UK

Several members of the SHOPPE BLACK community in London and surrounding areas have reached out to us asking if we know of any Black Owned banks in the UK.

The short answer: Of course we do!

However, we strongly advise doing your own research also in order to make the best decision with your hard earned money.

If you are interested in moving to a Black owned bank, and we assume you are, we also recommend taking a hard look at the leadership and management teams of the banks you are considering. As with any other type of business, a Black CEO does not necessarily mean a Black owned/controlled bank.

With that being said, here’s our list:

Black Owned Banks in the UK

FBN Bank (UK) is a wholly owned subsidiary of First Bank of Nigeria Plc, with offices in the heart of the City of London. FBN was incorporated as a Limited Liability Company in March 1894, with a head office in Liverpool. They are the “London bank for Nigerians, either resident in the UK or simply visiting.” MD and CEO: Dr. Adesola Kazeem Adeduntan (FCA)

Guaranty Trust Bank (UK) Limited is the fully owned subsidiary of Guaranty Trust Bank Plc, one of the leading financial services providers in Nigeria. They have business operations spanning the United Kingdom, West Africa and East Africa. Managing Director and CEO: Adekunle Adebiyi

Ghana International Bank (GHIB) which was incorporated in 1998, took over the London operations of Ghana Commercial Bank with the latter retaining a 20% ownership of the new bank. Ownership is now shared with other Ghanaian state institutions. The Central Bank of Ghana is the major shareholder (51%) while other stakes are held by the Social Security and National Insurance Trust. Managing Director and CEO: Joe Mensah

UBA Capital Europe Limited is a wholesale, investment bank and the London banking subsidiary of UBA Plc. It is also the first sub-Saharan bank to expand into North America when it opened its New York office in 1984 to offer banking services to Africans in Diaspora. Chairman: Tony O. Elumelu

Zenith Bank (UK) Ltd is a member of the Nigerian-based Zenith Bank Group. In March 2007, Zenith Bank was licensed by the Financial Services Authority (FSA) of the United Kingdom to establish Zenith Bank (UK) Limited. Zenith Bank Plc also has subsidiaries and representative offices in West Africa, South Africa and The People’s Republic of China. Chairman and Co-founder: Jim Ovia

Union Bank (UK )Plc is a subsidiary of the Union Bank of Nigeria Plc, one of the oldest banks in West Africa. They have been operating in London since 1983, firstly as the London branch of their parent bank, and since October 2004 as an independently incorporated UK bank. Chief Executive Officer: Emeka Emuwa

–Tony Oluwatoyin Lawson

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Published on July 19, 2016June 5, 2020

10 mins read

Economic Activism: A Viable Long Term Strategy

To state the painfully obvious, innocent Black people are being murdered by police on a consistent basis. The Prison Industrial Complex continues to close in on us. Our school systems are deplorable. Many of us don’t have access to healthy food options. Our neighborhoods are being gentrified. And no one is being held accountable.

In response, we are using various forms of social and political activism including marching, demonstrating and protesting. While these are good and necessary strategies in the short-term, as a long-term solution, we need to incorporate economic activism on a continuous basis.

Economic Activism

This is essentially the act of using your money, wealth or economic power to influence the changes that you want to see and that align with your political or social values.

Ways to practice Economic Activism

1) Boycott

Boycotts can be an effective way to bring awareness to an issue and publicly express dissatisfaction, anger and frustration. They have a long history of contributing to social change.

However, for a boycott related to Black dollars to be successful, alternative product and institutional options are necessary. If consumers are being told not to buy items at one place, they should be informed of where else they can find said items.

Another key to an effective boycott is concentrated focus and persistence. We can’t boycott for a few days or weeks, only to go right back and shop at the same place later. The Montgomery Bus Boycott lasted 381 days! That’s the type of dedication needed to create a change.

It’s important to realize that, in terms of products to choose from, we have more options than we may realize. There are a multitude of Black owned companies that offer quality products and services. However, we need to expand the variety of products that we offer. We need Black owned companies that can meet the demand we create in sectors like electronics, household appliances, and furniture to name a few.

2) Practice Group Economics

a) Support Black Owned Businesses

From the 1880’s into the 1960’s, a majority of American states enforced segregation through “Jim Crow” laws. Black people were prevented from patronizing white businesses and establishments. This forced us to create our own businesses and trade with each other. The Black dollar circulated within the community several times over before leaving, bringing rise to hundreds of successful Black businesses.

Due to racism and resentment, businesses in thriving communities were literally burned to the ground. After de-segregation, Black businesses started losing their customer base to white businesses outside the community.

In his book, “Powernomics,” Dr. Claude Anderson states “Black people have enriched every group, except themselves.” Based on the responses and messages that ShoppeBlack has received, it’s clear that people want to support Black businesses.

It’s not as hard as you may think. If its a matter of location, start with an online business. After some research and staying connected to SHOPPE BLACK, you’ll find out about some that are close to you depending on where you live.

There are at least a dozen other websites and apps that have been developed over the past couple of years that can direct you to Black owned businesses as well. Check them out.

b) Support Black Owned Banks

According to Federal Reserve data, although 13.2% of the U.S. population is African-American, less than half of 1% of U.S. banks are Black owned. The banks that do exist have been struggling due to the 2008 financial crisis and a lack of support from the Black community.

These banks play an important role in revitalizing communities that other financial institutions ignore. They provide services that allow many to avoid predatory payday loan establishments and check cashing places. They also provide needed home and business loans as well as lines of credit that are not readily available to a lot of Black business and home owners.

380576 — Citizens Trust Bank Next Generation Advisory Board

3) Form or Join Investment Groups.

Investment groups (not to be confused with investment clubs) are a great way to pool resources in order to:

a) Purchase income-producing assets (residential or commercial). One of the surest ways to accumulate wealth is to invest in rental properties: houses, apartment buildings, office complexes, etc.

b) Purchase shares or equity interest in corporations or other businesses. Money raised can also be invested in the creation or expansion of businesses in sectors where Black people are underrepresented but consume the most e.g textiles, footwear, watches, household appliances, toys, and electronic equipment.

c) Invest in projects like films, plays, arts institutions or the formation of media companies where we can control the images and the messages we send and receive.

4) Think Globally

While building a strong economic structure in the U.S., Black businesses and consumers should also consider forming relationships with entrepreneurs and consumers on the Continent, the Caribbean, Europe, Canada, Brazil, and other parts of South America. All of these regions have a high population of Black people. Pan-Africanist concepts and practices are critical now more than ever.

It seems as if our predecessors, without the use of social media, the internet, and fewer resources, were organizing more – Pan African Congresses, convenings, and dialogues – than we’re doing today. It’s high time that we defer back to the groundwork that’s already been laid for us by W.E.B. Du Bois, Marcus Garvey, and Kwame Nkrumah.

Ghanaian entrepreneur and investor Sangu Delle

This is group economics on an international level and opens up a market of a billion people. There are thousands upon thousands of quality products made abroad.

In 2010, President Obama announced the National Export Initiative in his State of the Union address to renew and revitalize efforts to promote American exports abroad.

70 percent of the world’s purchasing power is located outside the U.S and less than one percent of America’s 30 million companies export. That’s unfortunate because if there’s one thing the U.S. has, its the reputation that the products from here are of quality and excellent customer service. U.S. products are in high demand overseas.

Visit www.export.gov for information on the opportunities in overseas markets, federal resources, and upcoming trade events.

5) Control the Distribution Channel

A distribution channel is a network of individuals and organizations involved in getting a product or service from the producer to the customer. It can include manufacturers, wholesalers, distributors, retailers, and even the internet.

The beauty supply industry is one of many where Black people are almost non-existent in all parts of the supply chain other than as retailers and consumers.

The book “On My Own: Korean Businesses and Race Relations in America”, describes the explosion of the wig business in South Korea in the 1960s and explains how this is instrumental in the Korean domination of the Black hair supply industry.

In 1965, the Korean Wig merchants joined together and convinced the Korean government to ban the export of the raw hair, giving Koreans control over the manufacturing extensions and human hair wigs. Between 1965 and 1978, the YH Trade wig manufacturing company exported $100 million worth of wigs. The wigs did especially well with Black consumers. Now Koreans control the market and Black entrepreneurs are being shut out in order to protect the monopoly.