Five African-American banks will receive a $5 million gift from the Congressional Black Caucus.
On Tuesday, the Congressional Black Caucus Foundation, whose 43rd annual legislative conference begins today in Washington, D.C., announced a $5 million donation to five Black-owned banks to encourage private investment in minority financial institutions, according to the Washington Post.
Black banks have been a source of credit in communities that were overlooked by bigger institutions. But since the recession, it has been difficult for African-American banks to stay afloat.
“This investment is an important step toward achieving our goal of economic equality,” Shuanise Washington, chief executive of the foundation, said Tuesday at a news conference, according to the Washington Post. “Minority banks are an important source of accessible financial services and are key to reaching financially under-served communities.”
Industrial Bank in D.C., Liberty Bank & Trust Co. in New Orleans, Mechanics & Farmers Bank in Durham, North Carolina, Seaway Bank & Trust Co. in Chicago and City National Bank of New Jersey in Newark will each receive $1 million from the organization.
In the past decade the number of African-American banks have decreased by 50 percent. Payday lenders, check cashers and other alternative financial providers known for charging high rates have replaced them.
"These institutions attract monies into the community through reasonably aggressive rates on CDs,” said Russell Kashian, a professor in the Department of Economics at the University of Wisconsin said. “They are a source for valuable jobs in the neighborhoods they serve.”
BET National News - Keep up to date with breaking news stories from around the nation, including headlines from the hip hop and entertainment world. Click here to subscribe to our newsletter.
(Photo: Keith Brofsky/Getty Images)