Top 5 Black-Owned Banks in America
When you choose a bank, do you think about who owns it? Do you think about who gets loans from that bank and who doesn’t? Thousands of Americans started to consider these things when police shootings of two black men inspired rapper Killer Mike to urge consumers to move their deposits to black-owned banks in service of supporting the black community. And thus, the Bank Black movement was born.
A History of Black-Owned Banks
Social media spread the word with the help of the hashtags #BankBlack and #MoveYourMoney, resulting in an estimated $60 million being moved to black-owned banks in just nine months. The movement draws on a long history of calls for black financial empowerment that dates back to a bank established by Congress in 1864 to serve former slaves. In the many decades since, other banks have emerged to help the African-American community start businesses, buy homes and invest in each other when other banks weren’t doing so. Some of those banks are still around today.
According to a Federal Deposit Insurance Corporation (FDIC) study, black-owned banks made about 67% of their mortgage loans to black borrowers, compared with fewer than 1% made by community banks not run by minorities. So while there are only 19 black-owned banks in the entire country as of Oct. 30, 2018, according to BankBlackUSA.org, they do make a difference.
1. OneUnited Bank
- Assets: $661 million
- Headquarters: Boston
- Deposits: $376 million
- Number of branches: Six
Opened almost 50 years ago, the nation’s largest black-owned bank’s slogan is “part protest, part progress.” OneUnited is a government-designated CDFI serving low- to moderate-income communities. The bank holds workshops and events to increase financial literacy in the communities it serves and offers affordable financial services to meet its customers’ needs, including a secured credit card for rebuilding credit and a second-chance checking account.
2. Liberty Bank and Trust Company
- Assets: Over $594 million
- Headquarters: New Orleans
- Deposits: $549 million
- Number of branches: 22
Liberty Bank, a CDFI with branches in seven states, has increased its assets from $183 million a decade ago to more than $594 million today. Its Liberty Foundation pursues philanthropic initiatives, such as expanding access to secondary and higher education and increasing the availability of affordable housing. The bank’s chairman since its founding in 1972, Dr. Norman C. Francis, has also served as president of Xavier University since 1968.
3. Citizens Trust Bank
- Assets: $399 million
- Headquarters: Atlanta
- Deposits: $340 million
- Number of branches: 10
This strong and growing 96-year-old bank increased its assets, loans and mortgage originations in 2016. Its deposit accounts increased at six times the normal rate last year, thanks to an increased awareness of Citizens Trust generated by social media. The bank offers an affordable housing program for buyers who need down payment assistance; it also offers financial counseling.
Citizens Trust has also offered a program for middle- and high-school students called How to Do Your Banking, which uses learn-by-doing exercises to provide lessons on the importance of saving even small amounts, using a budget to achieve financial goals, how to bank online, how to keep checking accounts in balance and how to manage basic investing.
4. Industrial Bank
- Assets: $423 million
- Headquarters: Washington, D.C.
- Deposits: $331 million
- Number of branches: Eight
Industrial Bank, a CDFI founded in 1934, received about $2.7 million in deposits through more than 1,500 new accounts last July as part of D.C.’s #DivestToInvest movement, whose goal is to support African-American-owned banks and businesses. In 2015, the bank earned a Bank Enterprise Award worth $253,000 for increasing the number of loans it made in low- and moderate-income communities. More than 60% of its assets have been invested in these communities for more than 10 years.
5. The Harbor Bank of Maryland
- Assets: $266 million
- Headquarters: Baltimore
- Deposits: $233 million
- Number of branches: Seven
Opened in 1982, Harbor Bank primarily serves the Baltimore area with a variety of checking accounts, savings accounts, and loans. It is the country’s first community bank to have an investment subsidiary, Harbor Financial Services. Last November the bank announced plans to open a co-working incubator at its downtown headquarters to support local black-owned startups as well as community development and advocacy groups. It also received $70 million in federal funding to revitalize low-income communities.
The Bottom Line
Compared to the nation’s largest bank, JPMorgan Chase, these black-owned banks are tiny. Chase had $2 trillion in total assets, dwarfing OneUnited’s $661 million. However, a bank doesn’t have to be big to be successful and serve its customers well, though a lack of resources can sometimes hinder smaller institutions from doing all that their communities might like them to do.
Further, despite the average statistics, just because any particular bank is black-owned does not automatically mean that it does a superior job of serving the black community or that it is free from the corruption that has plagued the big banks. Consumers should thoroughly research the institution where they are putting their money, even when social change is one of their priorities in choosing a bank. To find a black-owned bank near you, see the spreadsheet compiled by Bank Black USA, which contains details about each of the country’s black-owned banks and grades them on the products they offer, their impact on the communities they serve and their usefulness to minorities.
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